Driving CO₂ Capture and Storage in the EU

The open hearing, co-hosted by Chris Davies, British MEP from the ALDE Group, launched a discussion on new ways of enabling CCS to help the EU achieve its climate goals. New instruments to promote and fund the CCS technology were presented by the co-authors of the CCS Market Incentives Report of Bellona Europa, Ivan Pearson, Project Manager at Bellona Europa and Keith Whiriskey of Bellona Foundation, Oslo.

The event, attended by the representatives from major political groups and key stakeholders opened a discussion on the future of CCS in light of the recent publication of the CCS communication by the European Commission  

The European Parliament’s coordinators for environmental policy agreed on 21 March to a proposal from Chris Davies, that the future of CO2 capture and storage (CCS) in the EU will be the subject to a 2013 Implementation Report by the Environment Committee. 

[picture2]

The report, entitled Developing and Applying Carbon Capture & Storage Technology in Europe, will propose new instruments to promote and fund the development of CCS. It will also analyse the reasons for the failure to secure approval for demonstration projects in the first round of the NER300 competition. 

” We are losing it out on the solar market compared to China, we cannot make it happen with the CCS technology as well “ – said Chris Davies, ALDE MEP,  who was nominated to be a rapporteur for the report.

The hearing took in place in the afternoon of the back loading vote in which the MEPs refused  to give the EU executive the power to intervene in the carbon market to boost prices.

The representative of the Global CCS Institute, John Scowcroft underlined “(…) any fixes that could help contribute to the longer-term operational costs of CCS projects in addition to capital expenditures will likely have a larger effect than a higher CO₂ price, as are efforts to level the playing field for demonstration plants.”

The need for effective targeted support to CCS

“The European Commission’s current view is that ETS and the NER programmes are the primary tools that are available to drive CCS. CCS is the only established abatement technology that does not benefit from effective support in the current suite of EU-level policies, “– said Paal Frisvold, Chairman of Bellona Europa.

 “Until a structural reform of the ETS can be realized, targeted support for CCS will be necessary. Because of the low CO2 price and the failure of the NER300, CCS is the only established abatement technology that does not benefit from targeted support in the current suite of EU-level policies,” – he explained.

Ivan Pearson, Project Manager at Bellona Europa and co-author of the report said : “The current suite of EU-level policies provides effective, targeted support to wind, solar, biomass, cogeneration and energy efficiency abatement opportunities – but not CCS.  Bellona supports backloading, as well as the long term reform of the ETS to provide an effective and neutral price signal for investment in low-carbon technologies”

[picture1]

The CCS Market Incentives Report elaborates on several options of CCS incentives such as: grant schemes, loan guarantees, green certificates, capacity auctions, purchase contracts and feebates.  

The cost of tackling climate change is moving up the politi­cal agenda. At this stage in the long-term transition to low-carbon energy, CCS may be able to cost-effectively deliver large amounts of CO₂ abatement. Without timely and bold action, however, the EU will lag behind other regions in the world in the deployment of CCS, needlessly increasing the cost of de­carbonisation to EU taxpayers and consumers.

Bellona Europa recommends a core EU CCS policy framework comprised of an overarching EU-wide CCS target and a complementary market incentive schemes at the national level.

The overarching EU-wide target should be coupled with a complementary blend of CCS market incentive schemes at the national level able to better cater to the significant differences between Member States in terms of the structure of their electricity markets.

CCS milestone analogous to ‘20% by 2020’ renewable energy target

A legally binding EU requirement for Member States to capture an agreed percentage of their total CO₂ emissions by 2030 would be a politically salient and mobilizing goal, driving CCS deployment in both the power and non-power sectors – the authors of the report argue.

“It would reassure investors of the political commitment to CCS, but still be flexible enough to complement other policy initia­tives at the EU- or national-levels. It would also accommodate Member State differences in ability and willingness to deploy CCS,” – Ivan Pearson concluded.