Keynote opening to the session 5 – Legal and societal aspects of CCS at the 2nd International Chairs Seminar on Carbon Capture, Transport and Storage 25th – 27th march 2013 | Paris & Le Havre, France

The climate change problem is not going away. Nuclear energy is still developping, 66 reactors are under construction. But this number is small compared to the 1200 coal power plants currently proposed in the world (according to WRI November 2012 report). And increasing intermittent renewable electricity generation and relying on international electricity trade can only go so far before one has to build fossil (natural gas) power plants to regulate the power supply. Thus, there is still a need to decarbonize energy and industry.

Yet the business case for investing in CCS is hard to make at the moment. Business cases can be based on short term profit, long term goals, or image arguments, and CCS fails in the three areas. There is no short-term return on investment, not until infrastructures and components are available at reasonable costs. The long-term strategic case for CCS is undermined by the absence of clear and strong climate policy. The communication or corporate responsibility value is also questionable, because of the risk of being associated with poor image of fossil energy, shale gas or nuclear waste storage.

In Europe, the recent history of CCS and short term perspectives for CCS are weak. The Lacq project, having ceased injection March 15th, demonstrated technical and social feasibility at the 51 ktCO2 scale. But the France-Nord project did not find the storage capacities take the next step forward. Germany adopted a 'CCS research only' stance. The UK have an offshore storage only policy. The Netherlands also banned storage under their own territory following the Barendreicht project rejection. We will forever wonder how things would have turned out if they did not try a first storage project under a densely populated area, or even if such a thing would have been conceivable in this country.

The NER300 program, which was supposed to provide support of CCS and renewable energy demonstration projects, is a big fail for CCS so far. Based on the sale of the first 200 million EUA (1t CO2 emission permits), a maximum of €1.5 billion was available to co-fund successful projects under the first call for proposals. In December 2012, the European Commission made a funding award of over €1.2 billion for 23 highly innovative renewable energy demonstration projects. No carbon capture and storage (CCS) project was awarded funding. Member States were unable to confirm the CCS projects put forward. The unused funds 300k€ will be carried over and made available for the second call for proposals, to open early April 2013. The English, who withdrew their candidates to rethink their CCS policy late in the game, plan to come back on the second round. The ULCOS project in France, canceled with prejudice, will probably not. Note that given the oversupply on the EU emission trading system (about 1B tCO2), the value of the remaining 100 million t CO2 emission permits is low. The CO2 permit went under 3€/t in late January, trades at around 4€ currently, and the member states have not agreed yet on how to save the system from collapse.

In the world, the situation is not as negative as in Europe. The GCCSI's 2012 report found that, in the past year, the net number of large-scale, integrated projects increased by one – to 75 – with eight projects being cancelled and nine new projects joining the ranks. Five of the new projects are in China, which appears to have become the fastest growing region for CCS. Other significant developments noted in the report included the opening of the CCS testing facility, Technology Centre Mongstad, in Norway, and Southern Company’s post-combustion project at the coal-fired Plant Barry power plant in the US becoming operational. Two large-scale demonstration projects singled out as being well on track for 2014 were Canada’s Boundary Dam and Kemper County in the US. Two oxycombustion project, the Spanish 300MW OXYCFB demonstrator at CIUDEN, and the FutureGen 2.0 project in North America, are on track to open in a few years.

Thus, we wonder if CCS is at a tipping point in Europe. Are our legal and social systems agile enough to compete globally in big technology ? Are we going to be out-innovated by other regions in the world with a 5% annual economic growth rate ? Or are our biggest corporations so transnational yet that what happens in Europe is irrelevant to their future successes ?