Carbon Capture Storage: How Cost Effective Is It?

Many agree that carbon capture is essential to prevent runaway climate change. Natural methods of capturing carbon include planting trees and improving soil management.¹ But increasingly, governments are also exploring technological solutions, otherwise known as carbon capture and storage (CCS) technology. The problem is that this technology is costly and not seen as cost-effective. 

Carbon capture technology and transporting CO2

There are only 20 facilities using carbon capture technology worldwide. But, more facilities are in the process of being built. Furthermore, billions of US dollars are being invested in the technology, according to the International Energy Agency (IEA).² The high cost of CCS technology, especially its transportation, is one reason for its slow adoption.

Captured carbon has to be transported somewhere so that it can be stored or used. Companies have previously used pipelines, ships or even tankers for transportation.³ Previously, captured carbon was often transported through a dedicated pipeline.

More recently, advocates for CCS technology say that it would be cheaper to build a cluster of CCS facilities and have them share a pipeline. But, we still need proof that the technology can work efficiently and cheaply enough to make a difference, the Financial Times pointed out in April 2021.⁴

Until the cost of releasing carbon into the air rises, companies have no reason to use it

Companies in Europe have to pay a carbon tax on each tonne of CO2 that they release into the air. In May 2021, this was around 46 euros per tonne. David Knipe, a former BP executive, told the Financial Times in April 2021 that the price needs to be higher to encourage companies to use carbon capture and storage technology.⁵

The lack of planning, security and funding for carbon capture storage

Carbon capture technology has long been a failure in Europe. In 2006, Norway was the first EU country to greenlight a carbon capture and storage facility. By 2013, after cost overruns and delays, the government closed it down. The decision was “a reflection not of the technology involved, but rather the shoddy organization and perpetual equivocation on behalf of the Norwegian government”, said one prominent Norweigan NGO. However, the country’s Auditor General said that “the complexity of implementing CCS was underestimated in 2006”.⁶ 

As Norway and other European countries look to invest in carbon capture storage again, they need to better plan and fund such projects.

1. Climate change: Five cheap ways to remove CO2 from the atmosphere. (2018). BBC News. [online] 24 Oct. Available at: https://www.bbc.co.uk/news/science-environment-45967215.
2. IEA. (2021). Is carbon capture too expensive? – Analysis. [online] Available at: https://www.iea.org/commentaries/is-carbon-capture-too-expensive.
3. Parliamentary Office of Science and Technology. (2009). CO2 CAPTURE, TRANSPORT AND STORAGE. [online] Available at: https://www.parliament.uk/globalassets/documents/post/postpn335.pdf.
4. Sullivan, C. (2021). Carbon capture eyes renewed backing despite past failures. [online] www.ft.com. Available at: https://www.ft.com/content/5d2e52ff-638a-44fa-a49c-447c739fa6c6.
5. Sullivan, C. (2021). Carbon capture eyes renewed backing despite past failures. [online] www.ft.com. Available at: https://www.ft.com/content/5d2e52ff-638a-44fa-a49c-447c739fa6c6.
6. Castelvecchi, D. (2013). Norway ditches large-scale carbon-capture plan : News blog. [online] Nature. Available at: http://blogs.nature.com/news/2013/09/norway-scraps-large-scale-carbon-capture-plan.html [Accessed 20 May 2021].