Progress on CCS?
Ecoal, June 2010, Vol.71
The International Energy Agency (IEA) has released a new report detailing international progress on CCS and recommended next steps. The report, compiled in co-operation with the Carbon Sequestration Leadership Forum (CSLF) and Global CCS Institute (GCCSI), was produced ahead of the G8 Summit in Muskoka, Canada.
It covers the following eight areas: demonstrating CCS; taking concerted international action; bridging the financial gap for demonstration; creating value for CO2 for commercialisation of CCS; establishing legal and regulatory frameworks; communicating with the public; infrastructure; and retrofit with CCS capture.
The background to the report was the recommendation to the G8 in 2008 that 20 full scale CCS demonstration projects should be committed to by 2010. Although progress has been made, the report calls for greater co-ordinated effort from the G8 to help meet the deployment targets outlined in the IEA's CCS Roadmap.
The formation of the GCCSI is highlighted as a key step towards concerted international action on CCS. However, the IEA calls for further international collaboration and knowledge sharing, particularly with developing countries on the issue of CCS and the CDM.
The bridging of the financial gap for CCS demonstration is perhaps the area where the IEA has observed the least progress, with three factors being identified: (i) uncertainty over the future of international climate change frameworks; (ii) insufficient carbon price signals; and (iii) high capital cost escalation. Although the report shows that governments have so far pledged around US$26 billion for large-scale CCS development, it calls for multilateral funding mechanisms to be developed to help raise the US$5-6.5 billion additional annual CCS investment recommended by the IEA's CCS Roadmap.
The IEA calls for government co-operation to develop a mechanism that will create a global value for CO2 to help bridge the financial gap. There is also the suggestion that a mechanism valuing low-carbon electricity generation could be deployed in the power sector.
The report was presented to G8 leaders at the Muskoka Summit, which ran from 25-26 June.
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