... believes projects must be environmentally sound and socially responsible. ... is the nation’s second largest export earner. ... spends over $20 billion each year on goods, services and the community in Australia. ... earned $38.6 billion of export revenue in 2012-13. ... is investing in cutting-edge technologies to reduce greenhouse gas emissions from coal mining and use. ... accounts for three quarters of Australia’s grid electricity generation. ... has almost halved its greenhouse gas emissions intensity since 1990. ... employs around 50,000 people directly and more than 135,000 indirectly.

What is carbon capture and storage?

Carbon Capture and Storage (CCS) is the only technology able to significantly reduce emissions from the use of fossil fuels, including in power generation, steel manufacture and cement production. It involves capturing carbon dioxide (CO2) from large emission sources, compressing it, transporting it to a suitable storage site, and injecting it into deep geological formations where it will be safely and permanently stored.

CCS is not just a coal technology. It can be applied to diesel, oil, coal and gas-fired power generation, natural gas processing associated with LNG production and other industrial activities.

The International Energy Agency (IEA) estimates that CCS applied to power generation and industrial processes could account for almost 14 per cent of cumulative emission reductions needed by 2050 to stabilise atmospheric CO2 to 450 ppm (parts per million). The IEA projects that 45% of this would be due to CCS captured from industrial applications and 55% from power generation. Without CCS, the IEA found that the cost of halving global greenhouse gas emissions by 2050 could be 70% higher. The exclusion of CCS as an option for the electricity sector alone could involve increased costs of US$2 trillion by 2050. This is because many of the alternatives to CCS for reducing emissions are more expensive.

Similarly, in its 2014 Fifth Assessment Report, the Intergovernmental Panel on Climate Change projects that without CCS, the cost of achieving the 450 ppm target between 2015 and 2100 increases by 138%. In its report, the IPCC looked at 11 different economic models. It found that 7 of the 11 could not resolve the achievement of 450 ppm without CCS.

CCS is generally well understood and has been used for decades at a large scale in certain applications:

  • CO2 pipelines (both under the sea and on land) are a long-established technology.
  • Large-scale CO2 separation is routinely undertaken in gas processing and many industrial processes.
  • Natural gas and LNG projects such as Sleipner and Snøhvit both in Norway have been injecting more than 1 and0.7 million tonnes (respectively) of CO2 each year into saline aquifers.
  • Nearly 10 million tonnes of CO2 per year is also used in the USA to enhance the recovery of crude oil from oil fields. The Weyburn-Midale project is currently injecting over 3 million tonnes of CO2 a year into two oil fields in Canada.
  • The Gorgon LNG Project in Western Australia will soon be one of the largest storage projects in the world, storing over 3 million tonnes of CO2 per year.

The Global CCS Institute says there are currently 13 operational large-scale CCS projects around the world, which have the capacity to prevent over 25 million tonnes a year (Mtpa) of CO2 from reaching the atmosphere.

The key technical challenge for widespread CCS deployment is the integration of component technologies into successful large-scale demonstration projects in new applications such as power generation and additional industrial processes. “There is an important co-dependency here. Without sufficient policy incentives to attract private funding, it is difficult to create the economic or market conditions required for broad based CCS demonstration (and deployment). Successful CCS demonstration projects in power and broader industrial applications are vital to establish a positive perception of CCS as a cost effective, environmentally friendly technology among investors and the general community.” (Global CCS Institute, The global status of CCS, 2013, page 10).

CCS in Australia

Australia has a strategic interest in the development and deployment of CCS. As the world’s largest exporter of coal, a major exporter of LNG and being reliant on fossil fuels for over 90 per cent of our electricity, successful deployment of CCS will allow Australia to continue to enjoy its comparative advantages as a resources rich economy while reducing greenhouse gas emissions.

There are several CCS projects at various stages of development around Australia. These projects are contributing to a concerted global effort to deploy this key technology.

As with all emerging technologies, the development pathway for CCS is complex and challenging and not all projects under consideration or in early stages of development will proceed to completion. The cancellation or postponement of some CCS demonstration projects in Australia and around the world is not unexpected, particularly given global economic uncertainties, and should not be taken to reflect a failure of the technology itself.

The Australian coal industry is committed to playing its part in the global CCS effort.  In partnership with government and other industrial stakeholders, the Australian coal industry has so far committed over $300 million under the COAL21 Fund.

Some notable achievements by the COAL21 Fund and other stakeholders include:

  • Successfully capturing CO2 at a Queensland coal-fired power plant and demonstrated the technology can be applied to existing and new power stations. Lessons learned will benefit projects planning to demonstrate the technology at even larger scale such as FutureGen II in the US and White Rose in the UK as well as assist Japanese manufacturers further develop High Efficiency Low Emissions/CCS technologies
  • Successfully sequestering 65,000 tonnes of CO2 in a depleted gas field in Victoria’s Otway Basin
  • Undertaking world leading research that, if successful, will greatly increase the estimated storage capacity in Australia and around the world
  • Intensifying the search for storage sites with exploration work under way/planned in Queensland, NSW, Victoria and WA
  • Contributing to the international R&D effort to solve unexpected problems encountered by large scale demonstration projects and to reduce methane emissions at operating coal mine