Peterhead power station, site of a potential Gas-CCS project. Photo: Iain Smith
Now to build a UK carbon capture industry
With solid progress on the UK’s first two carbon capture and storage (CCS) projects, there is much to be positive about. But how do we get from these two projects to between 15 and 25 coal and gas power stations fitted with CCS that our energy system needs? Not to mention CCS for steel, cement and chemical plant.
On the positive side, the White Rose coal-CCS project at Drax, the first of the two preferred bidders in the government’s commercialisation programme, got the go-ahead in December to proceed with engineering and design Studies. This groundbreaking work flatly contradicts John Harris’ view in the Guardian that CCS is a “non-starter.”
We also expect a similar positive announcement soon on the Peterhead Gas-CCS project in Scotland. The government also focussed some much-needed attention on industrial CCS when they announced that support would be made available to a feasibility study on industrial CCS as part of the Tees Valley City Deal – also announced in December.
Finally, as part of the White Rose project, National Grid will be developing the “Yorkshire Humber CCS Trunkline” – a pipeline able to carry a large amount of CO2 from a number of power and industrial emitters. Once this pipeline is in operation, it will signal the birth of a Yorkshire/Humber CCS cluster, a major part of our efforts to cost-effectively decarbonise both power and industrial sectors – this region alone emits 10% of the total emissions in the UK.
On 4 February 2014, the CCSA and the TUC published a report on The Economic Benefits of CCS in the UK. This report is another piece in the growing body of evidence on the massive benefits of CCS – 15,000-30,000 jobs annually by 2030, with GVA benefits of £2-£4 billion per year, reaching a cumulative market value of £15-£35 billion by 2030.
But how do we realise these benefits? Whilst we desperately need to build the first two projects, they alone obviously don’t make an industry!
We urgently need a vision for CCS that clearly sets out the process for the development of phase 2 CCS projects and how these will lead us to phase 3 etc. until the point at which CCS is cost-competitive with other low-carbon technologies. Without such a clearly defined process, there is a very real risk that the projects outside of the current competition, will be shelved – a serious setback for CCS in the UK.
There are encouraging signs that the government is turning its attention to this in its Response to the CCS Cost Reduction Task Force – published last October. In this report, the Government for the first time recognised the need for a second phase of CCS projects, and importantly, that these projects may need to be developed in parallel to the current competition projects.
Actually, this is a really important point. If we were to wait until the current competition projects were built, plus perhaps a few years of learning lessons before we begin to build phase 2 projects – we could be waiting seven years or more for projects three and four etc. to see the light of day. This is not a sustainable pathway for CCS – such a large gap will mean that most existing CCS developers will have moved on, the supply chain will not have developed, skills will be lost and lessons would need to be re-learned.
There are significant long-term benefits from CCS to 2030. But they could actually be felt much earlier – indeed, the CCSA/TUC report identifies that there are five to seven ‘shovel ready’ power and industry CCS projects that could deliver benefits in the next parliament (2015-2020). Each new-build power sector project could deliver £150m-£200m GVA per year during its lifetime – a significant boost to the UK economy. This highlights the need for this and the next government to take decisive action on CCS to deliver these five to seven projects and more.
Once these projects begin operating, we will be well on the way to a thriving CCS industry in the UK.