Fringe report: Carbon capture – the importance of developing capacity

At the party’s Autumn Conference Fringe, we held yet another well-attended panel discussion on technical issues of recent topical interest. On this occasion, we were privileged to hear from Sir Ed Davey, former Secretary of State for Energy and Climate Change, and Luke Warren of the Carbon Capture and Storage Association.

Davey began by outlining the attempts to make progress on strategic development of CCS technology during the coalition government. The government had ringfenced a £1bn capital budget for development of innovation to deliver CCS solutions, for which two schemes were close to bidding for a grant to bring cutting-edge designs to commercial reality. The two leaders in the competition were the Peterhead power station in Aberdeenshire and the White Rose Scheme in North Yorkshire and could have seen the UK take a leading position in the worldwide development of CCS technology as well as creating a high-tech industry in Scotland and the North East of England.

The project was the first government-led project to develop technology to decarbonise industry in the world but the ringfenced grant was cancelled by former Chancellor George Osborne in December 2015, just days before grants were due to be allotted.

Davey explained that the last minute pull out was a lost opportunity, not just for CCS technology, but for all future government-supported innovation as private investors will have lost confidence in the resolve of the government to see projects through to completion.

Warren supported Davey’s analysis and added that there was an additional cost to failing to act early in that delaying decarbonisation of industry would likely double the costs further down the line if the country is to hit our future carbon budgets.

He also explained that strategic development of CCS technology would help to attract and retain related industries in the area: industrial chemical companies are already showing an interest in the use of captured carbon for industrial processes such as fertilisers and Lotte Chemicals in Teesside is currently exploring development of a carbon capture unit that aims to sell on carbon as a feedstock to other providers in a model termed Carbon Capture and Usage (CCU). The limits to this are that the estimated potential usage of waste carbon is a very small fraction of the carbon produced so it would likely only ever play a marginal role in decarbonisation.

The only barrier to CCS currently, Warren explained, is support for commercialisation – there are no significant technological challenges to delivering the technology. The key requirement, at least for the power sector, is demonstrating that CCS-enabled power stations can operate at a cost of £85 per megawatt-hour or less.

Davey also raised the question of decommissioning oil and gas infrastructure in the North Sea and noted that some green groups were considering a new approach. While there had formerly been pressure to immediately remove infrastructure, the development of marine ecosystems around the rigs and the possibility of reusing the infrastructure for carbon storage projects meant than some groups, such as the Living North Sea Initiative, were now arguing that rigs should be retained and allowed to develop into living reefs. The pipelines themselves could then be used to deliver carbon captured from industries on the North East coast into storage.

The session ended with the speakers stressing that, while the pulling of government investment on our most advanced projects had been particularly damaging, there was still considerable will from British industry and some parliamentarians to make progress. Lord Oxburgh is chairing an advisory group and recently published a report arguing that CCS has a key role to play in decarbonisation.