Writing on the BHP blog yesterday, vice president, sustainability and climate change Dr Fiona Wild said the recently developed Petra Nova project was an illustration of a viable technology that "the world urgently needs to meet its current climate commitments".

 

Yet she said government and industry would need to dig deep and iron out some of the many kinks in current CCS projects to help CCS realise its full potential.

 

The International Energy Agency has estimated that under the United Nations' 2C warming scenario that nearly 60% of primary energy needs will continue to be met by fossil fuels in 2040.

 

"Without ways of capturing the emissions created from the production and use of fossil fuels, such as CCS, we will struggle to reach the emissions targets agreed at the COP21 climate conference in Paris in 2015," Dr Wild said.

 

While coal is losing ground to gas and renewables internationally, there is still a significant fleet of new coal-fired power being built, so CCS can be co-located and retrofitted to power plants such as Petra Nova, injecting carbon emissions into underground reservoirs instead of the atmosphere.

 

The $1 billion Petra Nova CCS project, which was propped up with significant taxpayer subsidies, like renewables, is being developed NRG Energy and JX Nippon Oil & Gas Exploration and will use CO2 from power generation to recover additional oil from the West Ranch oil field. 

 

The companies say that the plant can capture more than 90% of the carbon dioxide released from the 240 megawatt coal unit, or around 1MMtpa of emissions captured over the year. 

 

However, for every 5000t of CO2 captured per day, around 7000t of CO2 will be released if West Ranch reaches its 15,000bopd target, suggesting the CCS project may not quite have the benefits over the carbon life cycle intended.

 

A second CCS plant, Kemper operated by Southern Company in Mississippi, was supposed to have come on stream last week, but the $7 billion development has been delayed by a month.

 

The 582MW plant has started generating and burning syngas, however some emergency repairs needed to be made last month. It is already three years late and three times over budget.

 

Unlike Petra Nova, the newbuild plant turns low-grade lignite into syngas, stripping out 65% of the CO2, which is being used for EOR on nearby oil fields.

 

Beyond attempts to co-locate CCS and power plants, Dr Wild said there would be opportunities for industrial emissions to be captured.

 

Emissions from the industrial sector represent around 25% of global emissions, and more than half of these originate from the chemical and thermal processes currently used to produce steel and cement. 

 

"Developing economies need these products to build their cities and infrastructure. Only CCS can eliminate these emissions," Dr Wild claimed.

 

"So CCS is not just a technology to reduce emissions: if we can deploy it widely, we will maintain access to energy while supporting the jobs of millions of people around the world in the oil, gas, coal, steel and cement-making sectors."

 

She said the issue with CCS was that it still needs to be made economically viable, and at a pace that keeps the world on track for credible decarbonisation.

 

She said that policies "must be embedded in long-term strategies that recognise a range of abatement options will play a role in the future".

 

That could include a carbon price, which would help steer commercial investment into low emission technologies, including CCS.

 

"In the nearer term, industry and government must work together to develop pilot projects, demonstration plants and first of a kind commercial scale operations," she wrote.

 

For its part, BHP is working with Peking University to identify policy, technical and economic barriers to CCS deployment in the steel sector in China and learning from the lessons of SaskPower's Boundary Dam CCS project, which she said could cut development costs by 30% if they built the project again. 

 

"BHP Billiton is helping them to find ways to make relevant findings accessible to others," Dr Wild said.

 

"The longer that action is delayed, the more critical CCS will become. This is particularly the case if we need to develop negative emissions technologies, of which CCS is an important potential contributor.

 

"It's been 20 years since the first large-scale CCS project came on stream at Sleipner in Norway. We'll need to move more quickly in the next 20 years. The size and the scale of the climate challenge demands it - and CCS stands on the edge of being a major part of a global solution."

 

According to the Global CCS Institute there are 21 carbon capture projects worldwide on a large scale that are either operating or have been built, although many have struggled.

 

The US had aimed to have 10 full-scale CCS trial projects by 2016, however after spending almost $5 billion it has failed to reach its targets. 

 

While CCS advocates often dismiss the high costs as they are one-off developments, saying they will come down over time, The Union of Concerned Scientists argues CCS requires large amounts of concrete and steel and significant equipment, all of which does not benefit from the cost reduction benefits of modular technologies like wind turbines and solar panels. 

 

Several recent studies project the cost of coal with CCS to be much higher than many other low and zero carbon technologies. For example, the Energy Information Administration's projections from Annual Energy Outlook 2016 show costs for coal with CCS plants in 2022 that are 2-3 times higher than the cost of renewables. 

 

Some studies say the impacts of reducing CO2 emissions by as much as 80-90% by 2020 show gas or biopower with CCS could make a more meaningful contribution after 2040.