Stern Words on The Future of Carbon Capture & Storage
Foremost climate change economist, Sir Nicholas Stern, has told the Global Carbon Capture and Storage Institute that heavy polluting countries such as Australia must accept that future economic growth will come from investment in low-carbon technologies, while the Institute’s CEO says it must accelerate the development of 20 industrial scale, integrated demonstration projects, and move beyond those to broader commercial deployment.
Tom Arup reports in The Age (17 May 2010):
THE world’s foremost climate change economist, Sir Nicholas Stern, has told the Global Carbon Capture and Storage Institute that heavy polluting countries such as Australia must accept that future economic growth will come from investment in low-carbon technologies.
In a speech to the first US meeting of the institute, in Pittsburgh at the weekend, Sir Nicholas said the ”acrimony” at Copenhagen had damaged those arguing for green investment in the ”intense” Australian debate on climate change. In his speech Sir Nicholas singled out Australia, which has shelved its proposed emissions trading scheme, and China as countries where the debate about a green economy is sharpest.
Sir Nicholas said the extent of China’s acceptance of a green economy growth would be crucial to building global momentum towards a meeting at the Mexican resort city Cancun, which will again attempt to devise a new global agreement.
Here are some extracts from the speech by Nick Otter, CEO of the Global CCS Institute at the Pittsburgh meeting:
I am pleased to be talking to you today, and pleased that despite the financial dilemmas dominating politics and the world today that CCS is still a focus for governments and corporations alike. CCS is after all ultimately about energy, and rather than falling far from grace – energy security does and will continue to remain at the forefront of the US and global political agenda. It will remain a priority for corporations, executives and boards as they seek to manage risk and shareholder value, and it will remain a focus for NGOs as they contemplate how to influence environmental policies on behalf of their constituents.
The challenge we face today, in this room, is how to ensure that CCS becomes a part of the diverse energy supply portfolio in the US and globally in the immediate future, and that it lives up to its potential and plays a significant role in helping reduce emissions in the long-term. This challenge defines the role of the Institute, a role we are taking steps to fulfil by collaborating with our member countries and organisations.
The major challenges to the development and deployment of CCS projects are not insurmountable, but they are real. The obstacles are not geological – we know it can be done. The barrier is not the absence of technical solutions – it is clear that the individual states of CCS are viable. The major hurdles reside around what happens above the ground: policy, regulation, finance, public awareness, capacity building and knowledge sharing. The challenge is to address these barriers to create the conditions for the integration of these technologies at commercial scale and across a variety of applications.
If CCS is to make a difference the IEA estimates that 100 industrial scale projects may be needed by 2020, and 3,400 by 2050. This equates to flow rates surpassing the global oil and gas industry, over US $2 trillion in investment, and an average of over 100 new projects per year between 2020 and 2050.
In my opinion, there are three key factors to delivering the global collaboration required:
- First – common goals. We need governments, industries and communities to agree to a desired role for CCS, the extent to which support for a commercially viable industry should be provided, and what needs to be done to create that vision.
- Second – sharing knowledge. Our ambitious goals and steep development trajectory demands and industry which disseminates information to foster progress.
- Third – leadership. The fact that we are all here today demonstrates willingness, but what is needed is the creation of the means and pathways for industry members to contribute to making the extraordinary happen.
First, let’s look at whether any common pathways exist ahead of us. In terms of the Institute ‘us’ means our members. The Institute now has over 200 members including 40 governments and 160 corporations and like-minded organisations from around the world. The US Government was one of our founding members and is now a fully fledged legal member. Our members applications were accepted by the Institute due to their ability t demonstrate a legitimate interest in, and a commitment to the advancement of CCS.
The Institute itself as an interim goal to accelerate the development of 20 industrial scale, integrated, demonstration projects. And, we also have an important role to play in ensuring the right elements are in place for CCS to move beyond the demonstration phase to broader commercial deployment.
One of the early pieces of work conducted by the Institute was an audit of CCS projects globally. This research is not a static fixture in time, but an evolving piece of work that will be regularly updated and built upon to advance the understanding of the status of projects, the costs involved, the level of policy initiatives, and the gaps and barriers to deployment at scale. This was an initial piece of work to help begin to fill the information vacuum around the challenges facing CCS projects.
This not simply about information collation, this is about the collation of experiences, and in my mind the best source of knowledge is experience. This project is but one of the pieces of work the Institute will deliver to disseminate the lessons from large scale demonstration projects. Our work will require the collaborative efforts of the industry and governments to contribute experiences that will help other projects move forward where otherwise they may not have. Ultimately it will be to the benefit of all.
Most collaboration cannot occur unguided. And, in most instances a helping hand is needed to avoid our societies from sitting still. Again, there is a role for the Institute here. Not a dominating role, but an important leadership role to help catalyse the industry and our membership base.
The Institute is seeking to do this by sketching out plans of action to tackle every single one of those elements that can propel our industry into being or act as hurdles stopping our progress. I mentioned these elements before as ones that I believe exist ‘above the ground’: policy, regulation, finance, public awareness, technical, capacity building and knowledge sharing.
For each of these elements the Institute is producing concrete plans to guide our actions for the next three to four years. These plans are collaborative ones, providing our members with the opportunity to define our pathway to success, and that of the industry.
Does CCS have any benefits? Well we must all think there are otherwise we would not be here today. The benefits to the US and other individual regions are of course far reaching. With increased acceleration of CCS we would hope to see job creation, reduced emissions, and greater energy security.
But let me leave you with one clear benefit. Studies show that if CCS fails to achieve commercial viability, global mitigation costs will be around 10 percent higher in 2050 than they otherwise would have.
The US Government and the local and international companies operating here who are making CCS happen today are contributing to delivering these benefits for its citizens.
There are many in this room who are investing in CCS, they are working to put in place the regulatory frameworks to allow CCS to be deployed, and they are working with financiers to create innovative and enterprising models to make these projects commercially viable. These are the front-runners; the ones who are taking the risks – financially and politically.
These members of our industry are also the ones that will reap the rewards.