Industry Finding More 'Comfort' with Commercial Technology -- Survey

There are four primary barriers to carbon capture and sequestration technology, although some of the most often-cited obstacles may be exaggerated, according to a new survey of 229 industry experts.

The research, published this month in Energy Policy, confirmed that the cost of the technology, lack of a price signal such as a carbon fee, long-term liability risks of carbon dioxide storage underground and lack of a regulatory regime are the premier concerns of carbon capture experts in government, private companies and academic institutions.

The study notes, for example, that retrofitting an existing power plant with current CCS technology can cause a 50 to 80 percent increase in electricity costs.

At the same time, the survey -- which experts answered anonymously -- found that the lack of large, commercial projects operating at this point is not viewed as a "barrier" by many. There are no coal plants utilizing the technology at large scale, although two are under construction in the United States and Canada.

"Many studies make assertions about these barriers, such as the need for cost recovery measures or large-scale demonstration projects, but those assertions tend to be anecdotal. Our survey data gives both factual weight and additional detail to these claims, by looking at what those who really understand the industry have to say," said Lincoln Davies, a professor at University of Utah College of Law and study co-author.

Davies said the survey is significant for providing a blueprint of sorts with very specific details about what CCS policy might look like if it became a "mainline" climate strategy.

The survey respondents, for example, said they preferred tax incentives and credits over research and development spending and subsidies.

Federal control preferred 

They also outlined which regulatory responsibilities for the technology should fall with federal entities versus state governments. A significant percentage said there should be federal control over stored CO2, interstate CO2 transport and all aspects of offshore CCS. States, meanwhile, could have jurisdiction over property rights, pore space in underground rock and eminent domain issues.

Many of these regulatory issues have not been fully worked out with carbon capture specifically, despite piecemeal legislation by various states. Davies said the widespread call for a comprehensive regulatory regime is somewhat counterintuitive, considering that the energy industry is often associated with complaints about regulation in general. "Industry craves certainty," Davies said.

Of the 229 respondents, roughly 6 percent cited "technology inadequacy" as the most significant obstacle for CCS, which envisions grabbing CO2 from large emitters and storing the gas underground in rock formations or oil fields.

"The popular perception seems to be that you have to have big demonstration projects before you can start deploying this technology, but our survey data cuts against that assumption. Within the CCS community, there actually is a lot of comfort with the technology," Davies said.

The public focus on commercial-scale demonstration of CCS technology may have more to do with investor confidence and social acceptance than engineering capacity and technological know-how, according to the report.

The survey comes as existing projects continue to move forward, despite cost challenges and criticisms from environmentalists. Many green groups say that the billions of dollars spent on CCS would be better used on renewable power.

Earlier this month, Southern Co. CEO Tom Fanning said the Kemper project in Mississippi -- scheduled to be the nation's first commercial-scale CCS project -- is on track for a 2014 operation date, despite a nearly doubling in costs from several years ago (ClimateWire, Aug. 1).

This week, the University of Illinois, Urbana-Champaign, also released a report stating that FutureGen 2.0 would have a positive economic impact on Morgan County, Ill. State officials said the project would help the state's financial footing, while one local told The State Journal-Register that he was skeptical of the job numbers. The $1.65 billion FutureGen, which envisions a retrofit of an old plant, is not yet under construction.

Christa Marshall, E&E reporter

Republished from ClimateWire with permission. ClimateWire covers the politics and business of climate change. Click here for a free trial

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