Policies & Incentives

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CO2 Capture and Storage In Depth - Some key principles for policymakers download PDF

Policies and Incentives

In time, increasing economies of scale, technological progress and growing know-how will reduce the costs of CCS. Putting a price on carbon emissions, already practised in the EU’s Emissions Trading Scheme and expected to be more widely adopted, will make CCS - as a very low-carbon technology - more competitive. However, until CCS projects are competitive solely as a result of carbon pricing, we look to governments to make up the difference between the price of carbon and the extra cost CCS places on generation.

This is what makes policy matters key to the successful deployment of CCS technology. To this end, the CO₂ Capture Project organized a Policies and Incentives Team (P&I Team) in 2002 to begin studying the state of policies, regulations, incentives, and potential barriers around the world. The P&I Team had the primary mission to provide information and advice to the CCP partners on these issues and any other external developments that may impact or benefit the technology programme being developed by the CO₂ Capture Project. More specifically, the objectives of the P&I part of the programme are

Transport

In CCP2 the P&I Team has been focused on understanding transportation of CO₂ in pipelines. For carbon dioxide capture and geologic storage to be deployed commercially and in a widespread manner will require well thought out approaches for transporting the CO₂­ in a pipeline system from the capture facility to the injection site. In cooperation with Environmental Resources Management (ERM) the P&I Team completed a study that evaluated the benefits and risks of two approaches to developing CO₂ pipeline systems. The two basic approaches were:

While point-to-point pipelines may be readily funded on a project-by-project basis by individual developers, there may be a need for public policy to encourage the development of optimized networks. An optimized network could offer the potential to significantly reduce the per unit costs of transportation and reduce the barriers to entry when compared to point to point systems, Development of optimized networks can help to broaden participation and deepen deployment of CCS.

Establishing a widespread CO₂ transportation infrastructure will require strategic long-term planning, adopting a paradigm that takes into account the potential magnitude of future deployment scenarios for CCS, up to a scale of infrastructure that could be comparable to the scale of oil & gas infrastructure.