AGI/AIPG SUMMER INTERNS
that will never work? Is it poised to revolutionize the energy industry, or is it a sinking ship that is losing investors? Should we move forward with CCS technology, or is it a waste of money and effort?
CCS refers to trapping carbon dioxide, typically at a fossil fuel-fired power plant, and diverting it away from the atmo- sphere—typically into a geologic repository, although deep ocean storage and biomass storage are also being explored. A chorus of unlikely allies from the Intergovernmental Panel on Climate Change (IPCC)1 to the World Coal Association2 has voiced support for CCS implementation, and the International Energy Agency says that CCS should play a part in any realistic emissions reduction plan.
Despite clean energy’s gains in recent years, the U.S. Energy Information Administration predicts that fossil fuels will continue to supply more than three-quarters of global energy demand through 2040.3 Many developing countries are turning to minimally treated coal combustion as a primary energy source,4 and even the G7 nations still rely heavily on coal and natural gas.5 Fossil fuels, in short, will not go away any time soon.
There has been substantial effort in recent years to scale up carbon capture technology to make it more efficient and more financially competitive. Both parts of the process—the capture and the storage—are being researched around the world. Climbing this learning curve is a worthwhile effort, and it could indeed make carbon capture economically viable in coming decades. However, the energy required to capture
CO2, especially from natural gas, makes carbon capture inef- ficient in its current forms.
On the storage side, the Obama Administration has encouraged research into using deep saline aquifers. Critics of geological storage have questioned whether subsurface res- ervoirs can be expected to hold carbon without any leakage. However, this misses an important point: the factor that can throw a wrench into the ocean-atmosphere system is not the emission of greenhouse gases but the rate at which they enter
the atmosphere. Atmospheric CO2 is naturally drawn into the ocean and into biomass, but these natural carbon sinks can- not sequester carbon at the rates we are releasing it. In other
words, churning out a gigaton of CO2 in one year will disturb the system’s equilibrium more than releasing the same amount over a hundred or a thousand years. Hence, even if geological storage isn’t impervious to leakage, it can still help. The tricky part, yet again, is making it economically viable.
How can we use our captured carbon to defray the cost of cap- turing it? Two prominent coal-fired CCS projects, SaskPower’s Boundary Dam power plant in Saskatchewan and Mississippi Power’s Kemper County facility, will offset their costs by sell-
ing their captured CO2 to nearby oil fields. The CO2 then will be injected into the reservoirs of these fields to extract more
oil—a technique referred to as Enhanced Oil Recovery (EOR). However, as attractive as EOR is for getting more oil out of mature oil plays, it is largely limited to oilfields with power
plants situated close them. Also, the amount of CO2 produced by commercial-scale power plants dwarfs the demand from EOR operations.
The upshot is that carbon capture is unlikely to become mainstream until it can be engineered cheaply or unless a cap-and-trade system or a carbon tax incentivizes emission reductions. The outlook for such measures in the U.S. is uncertain, but not as improbable as one might think. Carbon taxation actually might have a fighting chance for bipartisan political support if it leads to a drawdown of environmental regulations. In the current environment, energy companies must deal with a complex and ambiguous regulatory system.
For instance, oil companies that use CO2 for EOR are concerned that once their oil plays are depleted, the injection wells will undergo a retroactive EPA reclassification from Class II, intended for “fluids associated with oil and gas production,” to the more stringent Class VI, which is intended for “geological
sequestration of CO2.” In contrast to the uncertainties and inefficiencies of environmental regulations, an up-front and unambiguous carbon tax can be predicted and planned for; therefore, conservatives might support enacting such a tax in exchange for loosening environmental regulations.
To that end, a consortium of six oil companies including BP and Royal Dutch Shell sent a letter on June 1, 2015, to the UN Framework Convention on Climate Change. The signatories exhorted international governments to create an integrated carbon pricing system: “Whatever we do to implement car- bon pricing ourselves will not be sufficient or commercially sustainable unless national governments introduce carbon pricing even-handedly and eventually enable global linkage between national systems.” The signatories requested that governments “introduce carbon pricing systems where they do not yet exist at the national or regional levels [and] create an international framework that could eventually connect national systems.”7
Environmental groups would be hard pressed to find a more improbable ally than the oil industry, but carbon taxation might offer the best chance for a compromise. The details of a carbon tax, such as exactly how many dollars per ton to charge, where to funnel the revenue, how to mitigate the tax’s harsher effects on low-income Americans, and how to remain com- petitive with foreign markets, will obviously present serious challenges. Given the complexity of the systems involved—not only the global climate system but also the global economy and its framework of existing energy and taxation policies—it’s impossible to say exactly what will happen, but broad-based climate change legislation may still be in the cards. Either way, geoscientists will need to stay at the forefront of innovation in responsible energy development.
1. Pachauri, R. K., Allen, M. R., Barros, V. R., Broome, J., Cramer, W., Christ, R., & van Vuuren, D. (2014). Climate Change 2014: Synthesis Report. Contribution of Working Groups I, II and III to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change.
2. Dodson, S. (2015, February 13). World Coal Association calls for investment in CCS. World Coal. Retrieved from
http://www.worldcoal.com.
3. U.S. Energy Information Administration, (2013, July). International Energy Outlook 2013. Retrieved from
http://www.eia.gov/forecasts/ieo/pdf/0484(2013). pdf.
4. Steckel, J. C., Edenhofer, O., & Jakob, M. (2015). Drivers for the renaissance of coal. Proceedings of the National Academy of Sciences, 112(29), E3775-E3781.
5. Vidal, J. (2015, June 8). Five G7 nations increased their coal use over a five-year period, research shows. The Guardian. Retrieved from http://www.
theguardian.com.
6. U.S. Environmental Protection Agency. (2012, August 2). Underground Injection Control: Classes of Wells. Retrieved from
http://water.epa.gov.
7. United Nations Framework Convention on Climate Change. (2015, June 1). Six Oil Majors Say: We Will Act Faster with Stronger Carbon Pricing. Retrieved from
http://newsroom.unfccc.int.
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