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Carbon capture: the hopes, challenges and controversies | FT Film

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Is carbon capture a help or a hindrance?

From my point of view, it’s a little bit of column A and a little bit of column B.

I don’t think at this stage we really have a plan of getting to net zero without some role for carbon capture and storage.

There is this sense that, for some industries, like steel and cement, it’s going to be very difficult for them to get to absolute zero.

But what should the role of CCS be for the oil and gas sector, for example, is much harder to agree on.

Long-term, you really need to change so many things about our system, rather than using the same old existing fossil fuel sources of energy and then finding a really expensive solution to how to deal with their emissions.

We’re starting from a place where there’s already too much CO2 in the atmosphere, so you need negative emission technologies to remove that last piece.

And until we have scale of renewable, this is an important element in decarbonizing the use of oil and gas.

In many ways, it can be a part of how we address the problem but it can’t be a magic cure to climate change.

Carbon capture.

Carbon capture.

Carbon capture.

The relatively new miracle of carbon capture and storage.

There’s a lot of talk about carbon capture right now from companies, from governments.

There’s been a lot more investment in the sector. We saw the US allocate billions of dollars to CCS and give a tax credit to carbon capture and storage projects.

Because the world hasn’t reduced emissions 40 billion tonnes a year, it means that the timeline for a tipping point in warming, which is regarded as 1.5 degrees, is nearing, and governments, policy makers, businesses are all really scrambling now. That means they’re turning to most obvious solutions.

There is some pushback to that, though, where people say, look, this is not a silver bullet, and the number of CCS facilities that are actually operational is pretty small. They don’t capture, in the grand scheme of things, that much carbon.

In 2021, there was around 40 million tonnes of CO2 captured by existing CCS projects. If the world is to be on the right path for net zero, that number would need to rise to around 1.7 billion tonnes of CO2 by around 2030. That’s a 40x increase just the next eight years.

To effectively capture carbon, you have to get it from the source, and so therefore, you need to have the facility where the emission is coming from.

Some of the biggest proponents and investors in CCS projects have been oil and gas companies.

It is the oil and gas industry which has the capability to actually find the stores for the CO2 and to physically store it. And most of the oil and gas companies, including Equinor, have been operating offshore for very many years. Those capabilities together is a big element of the CCS.

Norway started with this already in the 1990s. They’ve got a North Sea oil and gas platform where they’ve been pumping CO2 into the seabed since 1996.

For the Sleipner field and Snøhvit together, we have avoided CO2 emissions for 25 years of 1 to 2 million tonnes per year. So quite a bit of experience.

But then in 2007, 2008, they tried something that the prime minister, then Jens Stoltenberg, called Norway’s moon landing.

The full scale carbon capture plant on the new combined heat and power plant on our West Coast. This has never been done before, and we are poised to do it.

Well, unfortunately, it didn’t quite go as well as Neil Armstrong, and they had to abandon it after spending billions and billions of kroner. And so they’ve got a lot of experience, but it’s essentially uneconomical to do at any scale.

Whether it’s the carbon capture scale or it’s the transport scale and the storage scale, all of those are driven to lower economic costs by increasing the size.

The key question is how we make that economic and how you incentivise companies when it’s an expensive process and there’s no actual economic driver for them to do that.

Once you capture the carbon, what do you do with the carbon? In theory, in lots of projects, you just bury it underground, you put it under the sea, and that’s great. But that’s not a revenue source.

But if a use can be found for this CO2, a commercial use, that would also make the economics a lot more attractive.

Carbon capture and storage is what it says on the tin. It’s a capture of the carbon and storing it underground. Then there is its sister, which is carbon capture, usage, and storage.

CCUS is where some of that captured carbon dioxide is actually reused in industries where carbon dioxide is absolutely crucial and where there isn’t currently an answer for actually replacing its usage.

Your soda is fizzy because of CO2 that was stripped out of these industrial plants. It can be used in products like fertiliser, plastics and things that are really important to industry. And that’s a viable business model. That’s one that can support itself. You can sell the CO2 to any industrial user.

We saw last year, when a fertiliser plant in the northeast of England was closed down, which actually was a big producer of carbon dioxide as well, there was then sudden panic about a whole range of vital, vital industries, such as the food processing industry, how they were going to get the CO2 that’s desperately needed in those industries.

But it still is tinkering at the edges, it seems to me, of a much bigger problem. And it is not going to be the answer to the masses of carbon dioxide that are emitted from fossil fuel extraction in the first place or from the burning of other carbon-producing fuels.

Enhanced oil recovery has been one of the single biggest uses of captured CO2, where you take pressurised CO2, and you pump it back into old oil wells to increase the pressure inside the reserve and therefore dislodge the remaining hydrocarbon.

So ironically, in many ways, a technology that is used at the moment to try and kind of limit the worst effects of global warming, to try and combat climate change, was developed in the first place to produce more fossil fuels.

And that seems quite antithetical to how it’s being talked about by governments or by the IEA. That’s not really, I think, what most people think it should be used for or is being used for.

The environmental community is arguing that it’s counterintuitive. You’re capturing carbon and then injecting it into a reservoir in order to produce more hydrocarbons then burn it and create more carbon. So what’s the point? How about don’t dig that hydrocarbon up whatsoever? Don’t burn it.

The oil industry argues that enhanced oil recovery has been a benefit because they are storing carbon.

Oxy, for over 50 years, has been really the world’s largest handler of CO2, 20 million tonnes a year, in terms of volume.

And they argue that they have a unique skill set around CCS, where they can really play a leading role in pushing these things forward.

A particularly interesting example is Occidental Petroleum, which is seeking to use its expertise in that field to capture and store those emissions that are produced by the company’s operations and its suppliers, but also, in theory, enough carbon emissions to offset whatever oil was burned by its customers and the emissions that that created.

90 per cent of the carbon footprint of the big oil companies comes from when their products are burnt. So that’s really changed the calculus for them and they’ve had to rethink CCS as a technology. And they’re now exploring ways in which to really expand that at scale.

Today, we have chosen to partner with Carbon Engineering, a great, large-scale technology for direct air capture to create a true cost solution. That’s the ability to take a million tonnes per plant directly out of the air. We have a plan between 70 and 135 plants by 2035, which we believe is very important to address this problem.

I think the question is always, how much trust do those oil companies have, having been at the centre of some of the biggest emissions over the last three decades and been at the centre of a really contentious effort to push back, in some cases, against environmental strategies over the past 30 years?

And I think the worry is that if you overly focus on CCS, and if you’re seen to have this quick fix, do you just go first for that, rather than changing your processes to make them less energy-intensive or carbon-intensive?

The key problem with carbon capture, as many environmentalists see it, is that fossil fuel producers can continue to operate as they are operating now, without having to overhaul the way they do things. Because any emissions that are produced can just be sucked back up.

Environmentalists and climate change experts and scientists, actually, not to make them all sound like they’re tree huggers, believe that the first priority should be the reduction of carbon emissions in the atmosphere.

And I think that’s what we need to really get across and what the big oil companies need to probably understand is that if we don’t reduce oil and gas production and consumption, then we’re not going to hit net zero 2050.

The industry – and the IEA, quite frankly – and others will say that no matter what, fossil fuels are going to be around for decades to come. And CCS can be a really critical way of decarbonizing the sectors.

Other people say we don’t actually need that coal and gas, full stop. We can get to net zero without worrying about the fossil fuels, and that’s why I would argue that, actually, CCS is a bit of a distraction.

They’re worried about costs. Should the money that’s going towards carbon capture and storage actually be used to try and really accelerate even further offshore wind deployment or onshore wind deployment or solar or other clean energy technologies?

Renewable is developed today at scale, and we really believe in wind, but we need much larger scale of renewable. Until we have that scale of renewable, we would need CCS to bridge that.

You’re not going to bring down emissions with CCS alone. But I think, ultimately, what we should now recognise is that even if we manage to cut emissions to net zero by 2040, 10 years early, at that point, we’d still have a huge amount of carbon in the atmosphere that we’d want to try and pull out.

Negative emissions technology is any type of system that is reducing the overall CO2 in the atmosphere, so whether that’s direct air capture, for example, to take the CO2 out, pump it underground, or other approaches, such as bioenergy capture and storage. One of the biggest proposals for this is in the UK at Drax.

We have a publicly stated ambition to have 12 million tonnes of negative emissions before 2030. 8 million of that would be here at Drax power station, and BECCS underpins that ambition.

Drax, having been once Europe’s biggest emitter – it was a huge coal fired power station – has converted biomass, and it’s now developing BECCS, a horrible word, but basically means bioenergy with carbon capture and storage.

So combining those means, in theory, it’s carbon-negative, as you’ve got a neutral baseline, and then you’ve got this thing removing more carbon, so it becomes negative, in theory.

If you start with a tree, the tree is growing in the forest. It absorbs CO2 as it grows. That CO2 is stored in its wood. That’s turned into a wood pellet which is then burned. The CO2 is then captured and injected into the ground. That whole process has resulted, in principle, in a net negative CO2 impact.

We need negative emissions in the UK. The net zero 2050 strategy sets out a very clear 5 million tonne negative emission number required by 2030. Our project is perfectly shaped to fill that ambition. It’s probably the cheapest way you can get to at-scale negative emissions with the least amount of work. Why wouldn’t you?

BECCS, and just biomass in general, even before we get to BECCS, has been hugely controversial. Some just think it’s colourful carbon accounting.

At the crux, what you have to know is whether the biomass energy that is produced is carbon-neutral. If you can prove that it is, then BECCS can be a negative emissions technology. But if you can’t, and until you can, then we shouldn’t put all of this money and time and effort into growing a BECCS pipeline. You do that on the expectation that it’s going to be operational for decades, and so doing that locks it into the system for decades.

One of the really big changes we’ve seen in the carbon capture space is the emergence of this idea of having hubs, as they’re usually called, here in the US, or clusters, as they’re often called in the UK and in Europe.

The idea of a cluster probably does make sense. You’ve got different operators that do different things sort of sharing infrastructure. It’s just making the whole system more efficient. You could see why that makes sense.

They’re going to make a lot of sense in areas where you have a high-industrialised area with multiple industries that can manage the storage together, share the cost of the transport.

Norway is trying to develop a big project currently in the North Sea, as a store or a less charitable way of describing it as a graveyard for CO2, for a lot of Europe.

At the moment it’s a relatively modest project, but they say it has the potential to store, I think, it’s a sort of 1,000 annual emissions of Norway under the seabed. And then you’ve got the creatively titled Zero Carbon Humber in the UK.

In the Humber area, we are working together with 12 companies to put in place infrastructure that is required for them to decarbonize and have the opportunity to transport the CO2 to the store.

We have to reduce carbon emissions from industrial sources, from electricity production sources. We absolutely have to do that. But we’re still going to be left with hard-to-abate sectors where we’ve got residual emissions that we can’t do.

There’s lots of them – steel, ceramics, chemicals. Where it’s just not easy to envisage at the moment how actually they’re going to be able to exist in a net-zero world. So there’s definitely a case to be made that these technologies will save some of those industries. And without it, it’s very difficult to see what will happen.

What people don’t realise is that 85 per cent of our emissions are the result of the heat to drive our processes. It’s heat that makes steam. It’s heat to drive furnaces. It’s heat to drive rotating equipment. And that’s why you have to think about, how can I use different fuel sources that can generate that heat with a carbon-free way?

We will also help providing hydrogen, if that is helping them to reduce their emissions.

We’re not going to be able to use electricity for everything. So for the things that you can’t use electricity for, then you’re going to need a molecule, and I think that molecule is going to be hydrogen.

In many ways, the development of and optimism around carbon capture goes hand-in-hand with the development of and optimism around hydrogen as a future energy solution.

There’s a big increase in hydrogen investment right now, and forecasts show that hydrogen consumption will need to increase as we move towards net zero emissions. Hydrogen is a perfectly clean fuel to burn. When you burn it, no CO2 is emitted.

So you can feed hydrogen into a power station instead of natural gas, so making the power generation clean. And then we can use hydrogen as a reduction agent, very technical, into the steel industry so they can use hydrogen instead of coal in their processes.

There’s two main ways to produce it. One is using clean energy, and that leads to what we call green hydrogen. You can also make hydrogen from natural gas, along with CCS that removes the emissions from the chemical process, and that’s called blue hydrogen.

We cannot produce clean or green hydrogen in large enough quantities and that’s low enough cost for all of the applications for which hydrogen might be needed.

And so until that comes down, I do think blue hydrogen can be a useful bridging fuel to increase adoption of hydrogen as an option.

Blue hydrogen is a nice label, but it still doesn’t get away from the fact that you’re emitting carbon to produce a gas. So it doesn’t, to me, seem to be a huge advance.

Again, hydrogen, is it being overhyped? Because if we start replacing absolutely everything with hydrogen, then we will continue to rely on fossil fuel companies extracting gas because we will have created so many industries of hydrogen at the core that we won’t be able to wean ourselves off blue hydrogen.

To make sure we reach the climate goals and the Paris Agreement, we need to use all the tools in the toolbox. Those being CCS, it’s blue hydrogen, it’s green hydrogen, it’s electrification, and it is wind and solar. This is the way to decarbonise our society.

There is room for some of these technologies in areas where the industry, for all its best efforts, cannot transform itself quickly enough. But even for those industries, over time, it must become more expensive for them to deal in carbon so that other technologies become more viable, renewable energy becomes more viable.

It’s absolutely right that we shouldn’t use one to avoid doing the other. What we need to do is deploy both in parallel. And I think that’s what the industry and most industries are trying to achieve.

The climate crisis is so acute. The need for massive investment is so great that I don’t think we can be too picky about who advances what technology and who’s in charge. It’s too early to take options off the table.

I personally see carbon capture as critical to delivering on carbon neutrality for our industry, and actually, society. But at the end of the day, I do see it as a critical part of the transition, and the role of it, I think, will diminish over time.

Supporters of carbon capture and storage, the next few years are going to be absolutely crucial for them to show that these are technologies that are viable, that they can deliver the capture rates that they promise, that costs can come down. They’ve got to prove that actually will happen.

And I think that will decide whether this is the right moment, and, CCS is in the sweet spot, or whether CCS again looks a bit of an expensive white elephant.

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