Scaling the CO2 storage industry_Bellona Europa

The availability of CO₂ storage is the linchpin of CCS deployment. A lack of storage capacity could render CO₂ capture futile, and in the worst case could discourage investments in CCS projects. A CO₂ storage industry that can match the scale of the oil and gas sector will therefore be necessary to enable the necessary scale of CCS deployment.

This report takes a look at the practicalities of developing CO₂ storage in Europe and answers three key questions:

1. What is the rate at which CO₂ storage needs to be developed for CCS to be deployed and climate goals met?
2. Is the nascent CO₂ storage industry capable of scaling up quickly?
3. What are the requirements of a CO₂ storage industry?

Bellona has built a simple yet robust model to answer these questions and give insight into the broad lines of the future scale of CO₂ storage activities. It examines storage scenarios for onshore and offshore storage in saline aquifers, depleted oil and gas fields, and for enhanced oil recovery (EOR). The model uses storage data and the anticipated CO₂ captured each year to measure the necessary CO₂ storage capacity to be deployed throughout Europe. It does so “just in time” and for “just enough” CO₂ storage to meet set targets.

The study finds that annual investments in the range of €500 million need to begin by 2020, and increase rapidly into the 2020s, if we are to deliver the storage capacity required by the CCS projects operating in the 2030s and beyond (see figure). The first large scale investments in commercial storage should take place in 2019. This finding shows that what some consider early deployment is in fact timely deployment if we are to reach EU Energy Roadmap 2050 goals. There is therefore a clear and urgent need to have a functioning investment environment for both CCS and CO₂ storage operators starting within the next five years. A robust policy framework must therefore be assured as soon as possible.

The study also finds that the scale of the CO₂ storage industry will be large. Both in terms of material and human resources, storage operations will be on par with the current oil and gas industry. This could lead to a ‘competition’ for resources between ‘carbon emitters’ and ‘carbon sequesters’, which may delay growth of the storage industry. But it also affords Europe an opportunity to develop a huge new industrial sector that tackles climate change and provides thousands of jobs.

Regarding requirements of a storage industry, injectivity – the rate at which a well can inject CO₂ into a suitable storage site – is found to be as critical as storage capacity. Lower injectivity could result in a doubling of the cost and scale of CO₂ storage deployment. The role injection capacity plays in realising CCS is often underestimated. More effort is therefore needed to quantify the injectivity of prospective CO₂ storage sites.

The importance of injectivity is made even clearer by the finding that most storage will likely take place offshore. This reflects political and planning constraints that exist in Europe, but also the potential: Europe is fortunate in having a huge offshore CO₂ storage resource. Costs are generally higher offshore than onshore as greater demands are placed on characterisation and drilling. As reduced injectivity increases the required injection wells, an offshore scenario will have an even greater effect on CO₂ storage cost. Appropriate funding mechanisms for full-scale CCS as well as concrete investments in storage site development must therefore be a matter of policy priority.

Scaling the CO2 storage industry_Bellona Europa