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Federal Task Force Concludes CCS is Viable, But Carbon Price Is Critical; Sends Recommendations to President Obama on Fostering the Technology

President Obama’s Interagency Task Force on Carbon Capture and Storage (CCS), co-chaired by the US Environmental Protection Agency (EPA) and the Department of Energy (DOE), delivered a series of recommendations to the president on overcoming the barriers to the widespread, cost-effective deployment of CCS within 10 years.

The report concludes that while CCS can play an important role in domestic greenhouse gas (GHG) emissions reductions thereby preserving the option of using coal and other abundant domestic fossil energy resources, it faces a key barrier in the lack of a price on carbon.

The lack of comprehensive climate change legislation is the key barrier to CCS deployment. Without a carbon price and appropriate financial incentives for new technologies, there is no stable framework for investment in low-carbon technologies such as CCS. Significant Federal incentives for early deployment of CCS are in place, including RD&D efforts to push CCS technology development, and market-pull mechanisms such as tax credits and loan guarantees. However, many of these projects are being planned by the private sector in anticipation of requirements to reduce GHG emissions, and the foremost economic challenge to these projects is ongoing policy uncertainty regarding the value of GHG emissions reductions.

—Report of the Interagency Task Force on Carbon Capture and Storage

In February 2010, the president charged the task force with proposing a plan to overcome the barriers to the widespread, cost-effective deployment of carbon capture and storage within 10 years, with a goal of bringing five to 10 commercial demonstration projects online by 2016.

The United States has already made the largest government investment in carbon capture and storage of any nation, the DOE says, and these investments are being matched by private capital. DOE is currently pursuing multiple demonstration projects using close to $4 billion in federal funds, matched by more than $7 billion in private investments, which it says will begin to pave the way for widespread deployment of advanced CCS technologies within a decade. Ongoing EPA efforts will clarify the existing regulatory framework by developing requirements tailored for CCS, which will reduce uncertainty for early projects and help to ensure safe and effective deployment.

The report reflects input from 14 federal agencies and departments as well as hundreds of stakeholders and CCS experts. It addresses the incentives for CCS adoption and any financial, economic, technological, legal, institutional, or other barriers to deployment. The task force also considered how best to coordinate existing federal authorities and programs, as well as identify areas where additional federal authority may be necessary.

The report’s main findings and recommendations include:

  • CCS is Viable: There are no insurmountable technical, legal, institutional, or other barriers to the deployment of this technology.

  • A Carbon Price is Critical: Widespread cost-effective deployment of CCS is best achieved with a carbon price, but there are market drivers and actions that can and are taking place now, which are essential to support near-term CCS demonstration projects that will pave the way for broader deployment after a carbon price is in place.

  • Federal Coordination should be Strengthened: With additional federal actions and coordination, the task force believes our nation can meet the president’s near-term goal and get 5-10 commercial demonstration CCS demonstration projects online by 2016. The report recommends the creation of a standing federal agency roundtable and expert committee to facilitate that goal.

  • Recommendations on Liability: The task force conducted an in-depth analysis of options to address concerns that long-term liability could be a barrier to CCS deployment. It concluded that open-ended federal indemnification is not a viable alternative but that four approaches merit further consideration: relying on existing frameworks, limits on claims, a trust fund, and transfer of liability to the federal government (with contingencies). Efforts to improve long-term liability and stewardship frameworks led by EPA, DOE and the Department of Justice (DOJ) will continue in order to provide evaluation and recommendations in these areas by late 2011.

Additional recommendations include setting up an effort by DOE and EPA—in consultation with other agencies—to track regulatory implementation for early commercial CCS demonstration projects and consider whether additional statutory revisions are needed.

The report also encourages leveraging existing efforts among federal agencies, states, industry, and NGOs to gather information and evaluate potential key concerns about CCS in different areas of the United States and develop a comprehensive outreach strategy that would include: (1) a broad plan for public outreach targeted at the general public and decision makers; and (2) a “more focused engagement with communities that are candidates for CCS projects, to address such issues as environmental justice.”

Widespread cost-effective deployment of CCS will occur only if the technology is commercially available at economically competitive prices and supportive national policy frameworks, such as a cap on carbon pollution, are in place. The administration’s policy and technology initiatives are intended to address these needs.

Resources

Comments

HarveyD

Using CO2 + NG to produce essential liquid fuels may be a smart way to reduce unwanted CO2 and crude oil import at the same time.

SJC

IGCC can clean up 100s of coal fired power plants. They can pipe the CO2 to spent natural gas wells near biomass sources and use biomass and solar hydrogen. We can make methane and put it in the pipes to cities where it can be turned into methanol locally.

ai_vin

Came across someting related(???) today; http://inhabitat.com/2010/08/12/colorado-startup-uses-coal-eating-bacteria-to-grow-natural-gas/

SJC

I could see CO2 pipeline much like NG pipelines, except these would be going TO old spent NG wells instead of coming from them. If an NG well can contain methane for millions of years, it should be able to contain CO2 for 100. Once they find a profitable use for it, they can pipe it out all over the country to be used in building materials and fuels.

HarveyD

Good idea SJC.

SJC

I would imagine many others have thought along these lines, but it is worth mentioning. It is so easy just to say carbon capture will never work and we can not afford it. There have been many things that we thought we could not afford, but they got done.

SJC

It seems odd that some talk about the price of carbon without addressing the value of carbon. How can you set a price without a value?

Henry Gibson

Every pound of uranium burnt (fissioned) in a reactor is equivalent to about 3,000,000 pounds of carbon.

At this moment in time, the US economy cannot afford either CCS or high energy prices. To stop the entire US production of CO2, including people breathing, would not substantially reduce the levels of CO2 in the worlds air, and the US cannot put more people out of work just to be a show off. Prices on carbon in Germany did not reduce its use which has also increased since the price was imposed.

Just ration carbon; every body gets just so much a year. It becomes the real money. You want my carbon ration to jet to Hawaii? or to drive at 80 miles per hour; just pay me for it in siver or gold. ..HG..

chris

Until we can afford CCS, I guess we will just have to go with privatized energy companies utilizing wind, solar, tide, biomass, and likewise backed by investors instead of the government. Hate to tell ya, but I think it's time to find a new job. Why spill more milk just to clean it up when we can clean up the milk that's already been spilled. The only thing we're going to use coal for in the future will be for the production of biofuels, if even that. The majority of the US has spoken, the time of fossil fuels is over. We want something cheaper. We want something cleaner. We want something better. It's time to evolve. Either evolve or get left behind.

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