20 February, 2017
Courtesy of the AFR
Carbon capture and storage technology can provide electricity at less than a third of the cost of rooftop solar panels and excluding it from clean energy options will only increase the cost of reducing emissions, according to a US expert.
Julio Friedmann, the chief expert on carbon capture and storage in former US president Barack Obama’s administration, has rejected arguments that CCS is too expensive and says policy is to blame for the lack of investment in the area compared with the billions of dollars flowing into wind and solar power.
“The issue is not costs, it’s finance,” Mr Friedmann said, comparing the absence of policy settings to support CCS with that for renewable energy.
“There is no mechanism around the world today by which one can recoup an investment in a CCS plant.”
The US spent $US44 billion on production tax credits for the wind power sector in 2014, compared with zero in CCS, Mr Friedmann said.
CCS, a technology that involves extracting carbon from emissions from power and industrial plants and reusing it or disposing of it underground, cuts greenhouse emissions from those projects by 90 per cent or more.
Over the past decade, the world has spent $US2.2 trillion backing renewable energy projects, compared with just $US20 billion on CCS, said Mr Friedmann, a senior adviser for energy innovation at Lawrence Livermore National Laboratory in California.
Stability of power
But CCS stacks up on cost grounds against technologies that are receiving substantially more government support, he said.
He cited findings from Lazard that put the levelised cost of energy from a natural gas plant with CCS at US6¢-US7¢ a kilowatt hour, or at US8¢-US12¢ for a new coal-fired plant fitted with CCS.
That easily beat rooftop solar at US18¢-30¢/kWh, offshore wind at US15¢ and nuclear at US10¢-18¢, although it fell short of utility-scale solar at US5¢. Using fossil fuel plants with CCS provided needed reliability and stability of power supply to the grid, supporters argued.
Others disputed the competitiveness of CCS. Bloomberg New Energy Finance estimated the cost of producing energy from coal with CCS in Australia at about 35.2c/kWh, several times higher than new wind at 6.1¢-11.8¢, solar at 7.8¢-14¢ and new ultra-supercritical coal at 13.4¢-20.3¢.
The debate comes as the Turnbull government is considering expanding the brief of the Clean Energy Finance Corporation to help subsidise new-generation coal-fired power stations, including CCS plants.
Raised the ire
The rules for the government’s clean energy funding bank specifically rule out CCS as well as nuclear power.
The idea had raised the ire of the renewable energy lobby but Mr Friedmann said he was pleased to hear the government was re-examining the exclusion of CCS.
“Ultimately, you’ll have to decide what is best for your country, but clean energy is not synonymous with renewable,” he said.
“Whenever you throw out a clean energy option, you are basically saying ‘I am comfortable with a higher chance of failure and higher costs’.
“So in re-examining the CEFC’s charter, I am pleased that they are open to consider a wider set of options.”
‘Unloved’ by the public
Critics of CCS argued the technology was a sop to the coal industry but Mr Friedmann said that view was incomprehensible.
“When you retrofit a coal plant, you are not giving the coal industry anything,” he said. “[The idea] that paying out a little extra money to zero out plant emissions is bad baffles me.”
Mr Friedmann said part of the problem was that CCS was “unloved” by the public, compared with solar panels and windmills, making it easy for politicians to cast it aside.
But he argued it needed to be in the mix alongside renewables, energy efficiency and other responses.
“No clean megawatt left behind,” he said.