How carbon capture and storage was brought back from the dead, and what happens next

By Marc Hudson

Carbon Capture and Storage (CCS) is often promoted as a technology that will square circles.  One of those circles, in the United Kingdom, is the political need to “level up” the industrial left-behind areas of the north (the so-called ‘red wall’ seats) while also pushing towards a “net zero” economy by 2050.

The idea, that we can catch and bury carbon emissions while also helping steel, glass, cement and other heavy industry sectors become ‘zero carbon’ and keep people in jobs is seductive, and has many political backers.

Right now, CCS looks to be “all systems go”, with Government encouragement for both projects to capture carbon from power plants and factories and in to producehydrogen from natural gas on the East Coast and in the North-West (HyNet). Other projects in Scotland and elsewhere likely to get funding soon. Business models have been developed, contracts ­­­prepared and final investment decisions being pondered.  If – and it is a big if – everything goes as plan, millions of tonnes of carbon dioxide which would otherwise reach the atmosphere and cause our already overheating planet to warm even more will instead be diverted to where they some of them came from originally –oil and gas fields under the North Sea which are now empty.

The UK’s current CCS policy, involving a network of pipeline infrastructure connected to multiple industrial plants and then on to offshore storage sites is closely bound up with the approach to decarbonising industry by working through a ‘cluster’ approach, with “zero carbon” clusters helping the UK to achieve “Net Zero by 2050.”

But what is striking about CCS now being a key mitigation option is the stark contrast with  only a few years ago.

On 25th November 2015, six months after the election which the Conservative Party gained power without having to negotiate with the Liberal Democrats, Treasurer George Osborn announced his spending plans.  Rather than headline the fact that a CCS competition, worth a billion pounds, was being cancelled, a press release was ‘snuck out’.

The Carbon Capture and Storage Association (the main trade body lobbying for CCS) is, like any lobby group, usually quite emollient when disappointed.  On this occasion, they pulled no punches in their press release:

“Today’s announcement that the funding for CCS will be cut is devastating. Only six months ago the Government’s manifesto committed £1 billion of funding for CCS. Moving the goalposts just at the time when a four year competition is about to conclude is an appalling way to do business.”

However, CCS had already had a long and rocky road.  In 2004/5 Prime Minister Tony Blair had spoken of it approvingly.  Back thent climate concerns were growing and the expectation that coal would continue to be a major part of the UK energy mix. But when BP proposed a CCS scheme in Scotland, Treasury refused to give clarity about whether “renewable obligation certificates” would be offered. BP pulled the plug.  A tempestuous first attempt at a CCS competition saw gas-fired power plants be added to the potential winners, and  public protest about CCS as a “Trojan Horse” to allow the oil and gas industry to keep doing what it does. That competition had petered out in2011, after Treasury abolished a levy designed to fund it, and the last remaining competition entrant gave up.   Meanwhile, European Union funding efforts were going nowhere, the Australian Government had pulled the plug on most of its efforts and demonstration projects in the USA and Canada were beset with time and cost over-runs.

Even the biggest fans of CCS were doubtful about its future. Lord Oxburgh in his 2016 review admitted in a letter to the relevant minister that after so many false starts I began this study, as I know a number of my colleagues did, quite prepared to advise you to write-off CCS as a part of UK energy policy.”

How it came back

Exactly three years after the controversial decision by Osborne, the UK government was hosting a major international CCS conference in Edinburgh, and releasing its “Deployment Pathway.” It was also setting in train intensive work on the creation of business models and the regulatory framework for CCS.  How did this dramatic turn-around – a Lazarus-like revival – come to pass.

Our research suggests that a combination of factors.

Internationally, the Paris Agreement had focussed attention on increasing ambition around climate change. There had also been various initiatives such as the “Oil and Gas Climate Initiative” of the CEOs of (mostly European) oil companies, lending increased legitimacy to CCS initiatives.

The UK government (only a week after cancelling the CCS competition) participated in the COP21 climate conference in Paris, and signed up to reducing emissions in line with a two degree target.  A year later the UK government ratified the Paris Agreement. Instantly, that meant that the existing target – of 80% reduction in emissions by 2050, adopted in 2008 as part of the Climate Change Act –  came under intense scrutiny. To keep to its share of a global carbon budget, the UK’s ambition would have to be higher, and a “net zero” by 2050 target was advocated by many. This meant that industries which had previously thought themselves able to be in the 20% of “allowed” emission post-2050, had to start looking more intently at their own emissions. Energy efficiencies and changes to processes could only reduce by so much (and at escalating cost). A “system-wide” solution for capturing emissions from a variety of sources was -so the argument, went – going to be needed.

(Other previously international pressures were less clear. The EU was still licking its wounds after the failure of the “NER300” scheme to fund the much-vaunted 15 CCS projects, announced in 2009. The US, now looking intently at CCS under Joe Biden, was under the control of the Trump administration, hostile to any climate initiatives whatsoever).

Nationally, the Brexit referendum meant not only would the UK have to re-examine its climate policies (e.g. exit from the EU Emissions Trading Scheme), but there was a change of perspective within the Conservative Party to major government spending in support of industrial growth.  Under new Prime Minister Theresa May, the idea of “industrial strategy” was back on the agenda (she made much of this during her Conservative Party election bid.)  Two departments – DECC and BIS – which had previously looked at CCS for industrial decarbonisation, were brought together as “Business, Energy and Industrial Strategy” (BEIS).

The question of how UK industry could innovate and sustain itself as part of a “Green Industrial Revolution” began to pre-occupy policy makers.

Amidst all this, the proponents of CCS – including industry, academics and sympathetic civil servants and politicians – worked hard to combat the argument that CCS was prohibitively expensive and would only “work” for energy generators.  They kept up a constant tempo of reports, conferences and lobbying. Alongside arguments for a “hydrogen economy” (CCS would be needed to capture emissions from creating hydrogen from methane), the main argument they deployed was around saving industries and jobs in the “industrial heartlands” – especially on the East Coast of England.  It did not hurt that a Conservative, Ben Houchen, became Mayor of the traditionally Labour area of Teesside in 2017. He amplified the arguments of groups like the Teesside Collective that CCS was affordable and necessary.

As one interviewee put it to us

“As MPs are passing through the lobby, we need people to ask questions to their MP, “what about our CCS project?” And so it becomes much more locally-owned and supported amongst a diversity of people, rather than the few relatively remote technology advocates.”

Regardless of the hard work, the CCS lobby needed luck. And it got this the arrival of Claire Perry at BEIS as a minister. She and civil servants launched a “Clean Growth Strategy” in October 2017. This strategy was cautiously enthusiastic about CCS (cost flagged as a major factor!). More significantly, she established a “Cost Challenge Taskforce” (The more obvious title “cost reduction” had already been used in 2013!).  This taskforce brought together industry and civil servants which is regarded by our interviewees as the crucial moment of collaboration where details were hashed out, and the idea of industrial clusters” really took shape.  (Not everyone looks favourably on the Taskforce – for a view that it represents naked capture of the policymaking process, see this article by Nafeez Ahmed).

There was no single factor that brought CCS back.  Its return was not inevitable, but instead we can see it as an example of the importance of dedicated and persistent champions who did a variety of things. They

  • Worked assiduously to argue that the price would not be as high as the gloomiest predictions
  • Built a much bigger network of advocates (especially regionally)
  • Used the venues that were available to help “co-curate” policy development
  • Tied the technology to a narrative of industrial growth and innovation, and regional economic development and jobs.
  • Tied the technology to the renewed enthusiasm for hydrogen

How it is different this time?

So, CCS is back on the agenda.  It is no longer about single (energy) point-sources of carbon dioxide connected to a storage facility by a single pipeline. Instead the vision is of multiple sites (energy and industry) making use of a system of pipes leading to a variety of storage facilities, with scope – potentially  – for “greenhouse gas removal.”  Will it work at the speed and scale it needs to? Will the idea of clusters decarbonising continue to be promulgated CCS is NOT delivered? Time will tell. Is CCS, on its own, enough? Definitely not.  The UK (and the world) faces enormous challenges that a “techno-fix” – no matter how compelling and seductive, supported by powerful actors, will not be adequate to the challenges ahead.

Disclaimer: The views and opinions expressed in this blog are those of the authors alone and do not necessarily represent the opinions of the University of Sussex, the Sussex Energy Group as a whole, IDRIC, or any of its partners.

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