“For Gassnova SF this means a larger budget and a different type of organization to steer these projects in an effective way in cooperation with industry. We are talking about major investments in technology that must be developed sensibly,” says Bjørn Erik Haugan, Managing Director of Gassnova SF.
Haugan believes that the Norwegian investment in CCS is entering into a new phase from 2008.
Norway is investing heavily
“Decision-makers have been talking a lot about this climate measure for many years, and now the government and Stortinget are following up with allocations for the actual implementation. Here the decision-makers are showing a willingness to invest heavily,” he says.
“This is an area that demands close cooperation between industry and the public sector. CCS is an industrial activity, and we will not achieve success unless industry is willing to step up to the plate. We have seen a positive change in attitude and involvement from industry in recent years,” Haugan adds.
CCS facility at Kårstø
He does not wish to commit to a date for when the first CO2-free gas-fired power plant will be finished in Norway, but promises to have the groundwork for decision-making finished for Kårstø during the course of 2009. Here, Gassnova will specify how much the construction will cost, and how much time it will take.
“The technology that will be used is clear in principle, but has nevertheless only been applied on a smaller scale. An important challenge will be to increase the scale of the cleaning technology to make it a full-scale facility,” says Haugan.
Another challenge will be to make the cleaning process less energy-intensive, and thus cheaper per ton of CO2 cleaned. The costs of building a CCS facility at Kårstø was estimated at 3.5 billion kroner in 2006. In addition will come the costs of transporting CO2 in pipes to the North Sea to inject under the sea bottom. This means that the investments alone will be estimated to be about 5 billion kroner. It will cost about the same to operate the facility throughout its expected lifetime of 25 years.
“It will be about 700 kroner per ton CO2. It is probably too much if we want to have a broad application of the technology internationally,” says Haugan.
“The goal must be to come down to the level of greenhouse gas quotas, that is, about 200 kroner per ton.”
Test center at Mongstad
At the planned test center for CCS at Mongstad, two different CCS technologies will be tried out in an attempt to do something about the high treatment costs. A relatively well-known technology will be tested in parallel with another, less tested method. The plant will also test the capture of two different gases that resemble the exhaust from coal-fired power plants and gas-fired power plants.
Thus a lot will happen before Mongstad is in full operation – with a full-scale CCS treatment in place. Again, Haugen is reluctant to offer concrete predictions about the completion. But he points out that 2012 is a contracted time period for decisions about investment for this facility.
“But this is a very ambitious schedule that will demand enormous discipline and targeted work.”
Not enough with only renewables
Haugan believes that large-scale CCS is necessary to be able to achieve the large global emissions reductions that the Intergovernmental Panel on Climate Change (IPCC) shows is necessary in its latest report. He points out that most studies that look at the energy production in the future show that we still have a need for fossil energy sources. He does not believe that the world’s energy needs can be covered with only renewable energy sources, even though it is clear that we must also invest in these sources.
“Just how big the potential of CCS is will depend on how cheap the costs of capturing CO2 can become and how expensive it will be to emit in the future. These prices must approach one another to keep the technology from becoming a subsidy drain,” says Haugan.