By Brad Page, CEO, Global CCS Institute
April 6, 2017 - It is now clear that the outcome of the Paris climate talks was a game changer, delivering a renewed global commitment to addressing climate change. No longer are we aiming to limit global warming to 2°C. We are now aspiring for well below that—perhaps as low as 1.5°C. Significantly, the agreement also sets out global ambition for carbon neutrality by mid-century. In the post-COP21 discussions, thinking has shifted from “how much do we do?” to “how do we do so much? “
But the numbers are confronting.
The targets set by the countries signing up to the Paris Agreement only put the world on a track toward about 3°C. For many countries, the targets they volunteered are more ambitious than they have previously been; for many others, they remain more easily achieved. For some, and especially among developing countries, the outlook is not as simple: Energy poverty must be addressed alongside economic growth and environmental stewardship. Although these are not mutually exclusive, addressing all three imperatives concurrently can be expensive in the immediate term.
But the atmosphere is not forgiving. We are already at 400 ppm of CO2 and on track to exceed 450 ppm. To achieve the Paris ambition, emissions most likely have to peak in the next decade and there is a growing likelihood that negative emissions technologies will be necessary.
Assuming that current and announced climate policies are implemented, the International Energy Agency (IEA) forecasts that, despite the extensive, worldwide government support for renewables and increasing energy efficiency, fossil fuels are expected to meet approximately 75% of primary energy demand in 2040, down marginally from the historic share of around 80%.
Against this backdrop, energy access in developing countries is the path to improved living standards. The majority of increased fossil fuel usage will come from here, alongside an associated escalation in emissions, unless there are fundamental changes in approach.
Without doubt, visionary, bold, and innovative policy solutions are necessary. It will not be enough to single out popular technologies for support, and hope they will do the job. That is the path the world has been on for at least the past two decades and today we are farther away from our emission objectives, in absolute terms, than we were 20 years ago.
It is clear that renewables and energy efficiency will—must—play a significant and increasing role. Support for these will continue and their penetration will continue to increase from today’s base. But in the time available, this will not be enough.
Industrial processes account for approximately 25% of greenhouse gas emissions. Energy efficiency is relevant but the main, perhaps only, technology to address this problem is carbon capture and storage (CCS). Renewables offer very limited potential in this area.
In power generation, the installed stock of fossil fuel plants is so great that much of it will not be retired in the next 30 years. Additionally, Carbon Tracker reports that more than 2000 new coal-fired generators are planned for construction by 2030. This level of additional coal-fired generation capacity is completely inconsistent with the Paris Agreement unless it is accompanied by CCS.
To the extent that new coal-fired generators are constructed and operated, it is imperative they are of the highest efficiency available and operated to contribute positively to energy security while minimizing their emissions. HELE (high-efficiency, low-emissions) coal-fired generators need to be the minimum specification acceptable for new-build and replacement coal plants.
Fossil fuel demand growing and reserves robust.
Source: IEA World Energy Outlook, 2015 (New policies scenario).
Source: BP Statistical Review of World Energy 2015
But will this be enough against the Paris Agreement backdrop? The short answer is no.
Coal-fired generation technology is mature, relatively low cost, and widely available. Continual research and development over many decades has lifted efficiency from 20% in old subcritical plants to as high as 40+% in the latest ultra-supercritical plants. These improvements in efficiency have also seen greenhouse gas emissions fall per unit of output by upward of 25%.
It is entirely sensible that all new coal-fired generators should be ultra-supercritical. The additional electrical output per unit of fuel as well as valuable efficiencies in water consumption and emissions should make the latest technology (when viewed over the life of the plant) highly attractive. Nonetheless, although this technology represents a huge improvement in all aspects of performance over the average of the global-installed fleet, these plants remain relatively emissions intensive.
Even at 650–800 kg CO2/MWh, ultra-supercritical plants are about twice as emissions intensive per MWh as the latest combined-cycle gas turbines. Yet with the need to peak emissions within 10 years, gas turbines will be unacceptably high in emissions in the short run, unless CCS is part of their utilization.
While this picture leads to a conclusion that CCS is vital, the path to its widespread uptake is far from clear.
Over the decade to 2014, global investment in renewables was just short of US$2 trillion. Over the same period, investment in CCS was US$20 billion. How can such a disparity in investment exist if the world is trying to achieve what amounts to a complete energy system redesign—indeed, redevelopment—in the next 35 years?
In short, it comes down to the business case. When there is not a clear and enduring value for carbon dioxide, and policies instead are deliberately constructed to favour specific technologies, then capital will go to where the best reliable return can be achieved. For more than 20 years this has essentially flowed to renewable technologies: first on-shore wind, then solar, and, close on their heels, off-shore wind.
Doubtless this has led to a fast and continuing lowering of the unit price of all of these technologies. When all of the available clean energy technologies are needed to address emissions, this is clearly positive. However, when fossil fuels represent the overwhelming majority of primary energy demand and are projected to do so for another 15–25 years at least, then ignoring the key technology that can make fossil fuels “low emission” directly threatens the ability to arrest the climate challenge. As emissions need to peak in the next 10 years, this looks increasingly unlikely.
Those opposing CCS are vocal but their arguments warrant critical analysis.
Contrary to the views of some, CCS is not experimental. Currently 15 large-scale integrated facilities are operating in various countries around the world, capturing and storing 28 million tonnes of CO2 every year. Another seven are under construction (including two very large power plants) and, when operating in the next 2–3 years, these will increase capture and storage to 40 million tonnes per annum.
Others say it is too expensive. “Compared to what?” should be the rejoinder. If the comparison is to unabated fossil fuel technology, then of course it is. In comparison to renewable or nuclear generation options, however, it is rarely more expensive. Successive studies have shown that CCS is generally more expensive than old hydro and on-shore wind but generally competitive with utility-scale solar PV, geothermal, and new hydro while being lower in cost than small-scale PV, off-shore wind, nuclear, and the many other nascent technologies—especially when the real cost of filling-in for intermittency is included. Yes, it is a high capital cost addition. But it also delivers dependable, secure, dispatchable baseload, and load-following power. From a system security perspective, few low-emissions alternatives compare favorably.
Another claim is that it simply perpetuates the use of fossil fuels. The alternative, and more realistic, approach is that the continued use of fossil fuels over the period of concern is going to happen anyway. And it will be in large volumes. This is reality. It is simply not possible in the space of one or two decades to switch off fossil fuels. Even if the world’s electricity system could be run exclusively on zero-emissions generation in the time period (highly unlikely, of course), the industrial sector—chemicals, fertilizer, steel, and cement production, for example—will continue to require carbon-based fuels. The industrial processing sector alone is 25% of global emissions and cannot be ignored if climate objectives are to be achieved. Only CCS can deal with these unavoidable emissions. Perhaps more significantly, much of the developing world will exploit its carbon-based fuels, coal key among them, to lift national and personal incomes and give their citizens a better way of life. Plans for new coal-fired power stations confirm this. CCS must be part of the plan for these power stations.
Increasingly it appears inevitable that negative emissions technologies—those that actively take CO2 out of the atmosphere—will be necessary to achieve 2°C, let alone 1.5°C. Few options exist in this area; forestry is obvious, but the time taken to embed carbon in trees is long compared to the rate at which emissions occur. Bio-energy production with CCS is the main alternative and is already a reality; the Illinois Industrial Project at Decatur in the U.S. represents precisely this. But the infrastructure, pipes and storage facilities, doesn’t simply turn up at will. It requires planning, permitting, and proper evaluation and construction, as well as a sound business case and preferably many users to minimize the cost per tonne transported and stored. The likely most efficient approach to this is to start early and decarbonize whole industrial clusters by providing common user infrastructure and rewarding those that choose to move to a low-carbon production model. This is again a question of policy, policy that needs to be long term in its thinking with cost minimizing as a key objective.
After Paris, one thing is clear: There’s no place to hide when it comes to decarbonizing the world. Countries have signed up to an agreement that includes provisions to prevent so-called “backsliding”. Future targets and commitments can only be more ambitious, and if the temperature objectives are to be achieved, then this is necessary and inevitable. Every sector of the global economy will be under close examination, including many (especially in the industrial processing arena) that, to date, have been largely left alone.
Time is short. The challenge is huge.
The overriding guiding principle for decarbonizing should be to do it at minimum cost. That isn’t the track the world has been on for over 20 years as many policies have led to abatement cost multiples above what was necessary.
CCS is consistently reported as having a key role in solving the decarbonization challenge at least cost. Combined with HELE in coal-fired power generation, increased efficiency in many industrial processes, and applied to bioenergy production, CCS can make the difference in whether or not the Paris Agreement objectives can be achieved.
But to do this we need worldwide policies that focus on delivering clean energy, not just those that, for whatever reason, are popular or preferred in any given period.