CO2 Capture

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I N T E R N AT I O N A L E N E R G Y A G E N C Y

Energy Technology Analysis

CO2 CAPTURE AND STORAGEA key carbon abatement option

CO2 CAPTURE AND STORAGEA key carbon abatement optionOil, coal and natural gas will remain the worlds dominant sources of energy over the next decades, with resulting carbon dioxide emissions set to increase to unsustainable levels. However, technologies that help reduce CO2 emissions from fossil fuels can reverse this trend. CO2 capture and storage (CCS) is particularly promising. CCS takes CO2 from large stationary sources and stores it in deep geological layers to prevent its release into the atmosphere. At their Gleneagles summit in 2005, G8 leaders asked the IEA to advise on alternative energy scenarios and strategies aimed at a clean clever and competitive energy future, and to work on accelerating the development and commercialisation of CCS. CO2 Capture and Storage: A Key Carbon Abatement Option responds to the G8 request. The study documents progress toward the development of CCS: Capture, transportation and storage technologies and their costs Storage capacity estimates Regional assessment of CCS potential Legal and regulatory frameworks Public awareness and outreach strategies Financial mechanisms and international mechanisms The IEA study discusses also the role of CCS in ambitious new energy scenarios that aim for substantial emissions reduction. This publication elaborates the potential of CCS in coal-fuelled electricity generation and estimates for capture in the industry and fuel transformation sectors. Finally, it assesses the infrastructure needed to process and transport large volumes of CO2. With an updated roadmap of CCS development needs in the near and long term, this publication equips decision makers in the public and private sector with essential information that is needed for accelerating its demonstration and deployment in a sustainable manner.

(61 2008 01 1 P1) ISBN 978-92-64-04140-0 100

I N T E R N AT I O N A L E N E R G Y A G E N C Y

CO2 CAPTURE AND STORAGEA key carbon abatement option

INTERNATIONAL ENERGY AGENCYThe International Energy Agency (IEA) is an autonomous body which was established in November 1974 within the framework of the Organisation for Economic Co-operation and Development (OECD) to implement an international energy programme. It carries out a comprehensive programme of energy co-operation among twenty-eight of the OECD thirty member countries. The basic aims of the IEA are: n To maintain and improve systems for coping with oil supply disruptions. n To promote rational energy policies in a global context through co-operative relations with non-member countries, industry and international organisations. n To operate a permanent information system on the international oil market. n To improve the worlds energy supply and demand structure by developing alternative energy sources and increasing the efciency of energy use. n To promote international collaboration on energy technology. n To assist in the integration of environmental and energy policies. The IEA member countries are: Australia, Austria, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Japan, Republic of Korea, Luxembourg, Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic, Spain, Sweden, Switzerland, Turkey, United Kingdom and United States. The European Commission also participates in the work of the IEA.

ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENTThe OECD is a unique forum where the governments of thirty democracies work together to address the economic, social and environmental challenges of globalisation. The OECD is also at the forefront of efforts to understand and to help governments respond to new developments and concerns, such as corporate governance, the information economy and the challenges of an ageing population. The Organisation provides a setting where governments can compare policy experiences, seek answers to common problems, identify good practice and work to co-ordinate domestic and international policies. The OECD member countries are: Australia, Austria, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Japan, Republic of Korea, Luxembourg, Mexico, Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic, Spain, Sweden, Switzerland, Turkey, United Kingdom and United States. The European Commission takes part in the work of the OECD.

OECD/IEA, 2008 International Energy Agency (IEA), Head of Communication and Information Ofce, 9 rue de la Fdration, 75739 Paris Cedex 15, France.

FOREWORD

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FOREWORDRecent IEA analysis conrms that, without policy changes, CO2-intensive coal and other fossil fuels will play a growing role in meeting our future energy needs. The successful deployment of CO2 capture and storage (CCS) will allow countries to continue using these resources while simultaneously achieving deep reductions in greenhouse gas emissions. Of course CCS is not a magic bullet, but it can be an important part of a broad portfolio of options, which include energy efciency, renewables and nuclear energy, for improving energy security and tackling climate change. The energy challenges we face are great; all of these technologies have a role to play in achieving a more sustainable future. The 2004 IEA publication Prospects for CO2 Capture and Storage provided the rst detailed global assessment of the role of CCS in climate change mitigation, and included our best attempts to analyse the cost, performance and policy implications of this important technology. Since that publication, there has been an explosion of interest in CCS at every level, resulting in international treaty amendments, new policies and regulations related to CCS, major national and regional demonstration projects, and private sector research and deployment of various aspects of the technology. As a result, today we have better information about the cost and performance of CCSincluding the individual components: CO2 capture, transport and storage. We have used this improved data to analyse the contribution of CCS in future climate change mitigation scenarios. While these developments are to be commended, there remain signicant challenges if CCS is to be successfully commercialised. These include the lack of appropriate long-term policy frameworks and sufcient nancial incentives to justify investment, particularly for the critical early demonstration projects. This publication takes a look at the many approaches for CCS commercialisation that are currently being tested in a number of different countries, and makes recommendations for a roadmap that attempts to address the technical, nancing and legal/regulatory challenges. I am delighted that the IEA continues to play a leading role in promoting the development and deployment of CO2 capture and storage, and hope that this latest publication helps to foster the rapid uptake of this key CO2 abatement option. Nobuo Tanaka Executive Director

OECD/IEA, 2008

This publication has been produced under the authority of the Executive Director of the International Energy Agency. The views expressed do not necessarily reect the views or policies of individual IEA member countries.

OECD/IEA, 2008

ACKNOWLEDGEMENTS

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ACKNOWLEDGEMENTSThis publication was prepared by the International Energy Agencys Energy Technology Ofce (ETO), in close association with the Economic Analysis Division (EAD) and the Long-term Cooperation and Policy Analysis Ofce (LTO). Neil Hirst, Director of the ETO, provided invaluable leadership and inspiration throughout the project. Peter Taylor, Acting Head of the Energy Technology Policy Division from November 2007, provided key resources and guidance; Antonio Pger, Head of the Energy Technology Collaboration Division, and Pieter Boot, Director of the LTO, offered important guidance and input. Kamel Bennaceur was the project leader for the development of the study. The other main authors were Dolf Gielen, Tom Kerr and Cecilia Tam. Many other IEA colleagues have provided important contributions, in particular Ingrid Barnsley, Sankar Bhattacharya, Fatih Birol, Rick Bradley, Robert Dixon, Jason Elliott, Rebecca Gaghen, Jean Yves Garnier, Dagmar Graczyk, Didier Houssin, Steven Lee, Jim Murphy, Andrea Nour, Cedric Philibert, Roberta Quadrelli, Brian Ricketts, Ulrik Stridbaek, Peter Taylor, Nathalie Trudeau, and Nancy Turck. A number of consultants have contributed to different parts of the publication: Niclas Mattsson (Chalmers University of Technology, Sweden) and Uwe Remme (IER University Stuttgart, Germany) helped in the Energy Technology Perspectives model analysis. John Newman (France) contributed to the analysis of CCS in industry. Simone Brinkmann and Gillian Balitrand helped to prepare the manuscript. The manuscript was edited by Rob Wright and Deborah Glassmann. Production and distribution assistance was provided by the IEA Communication and Information Ofce: Rebecca Gaghen, Jane Barbire, Muriel Custodio, Corinne Hayworth, Bertrand Sadin, Sophie Schlondorff and Sylvie Stephan added signicantly to the material presented. Special thanks go to Nobuo Tanaka (IEA Executive Director, France) and Claude Mandil (former IEA Executive Director, France) for their encouragement, support and suggestions. This work was guided by the IEA Committee on Energy Research and Technology (CERT). Its members and the IEA Energy Advisors provided important guidance that helped to improve substantially the policy relevance of this document. The Standing-Group on Long-Term Co-operation, the End-Use Working Party, the Renewable Energy Working Party, the Fossil Fuel Working Party and the Buildings Co-ordination Group all provided valuable comments and suggestions. The