Thursday, June 30, 2011

Getting to Commercial-Scale Carbon Capture and Sequestration

Legal scholarship of late has highlighted the need not just for climate mitigation but also for climate adaptation.  One energy option that falls somewhere in between these two ends of the spectrum is carbon capture and sequestration ("CCS"): removing carbon dioxide streams from commercial operations, especially coal-fired power plant emissions, and then transporting it to geologic formations where it can be stored long-term underground.

Despite the fact that the oil and gas industry has used this process for years in enhanced oil reocvery operations, commercial-scale CCS has yet to get off the ground as a climate change solution.  Numerous recent scholarly articles have addressed legal concerns related to carbon capture and sequestration, including, to name just a few, excellent pieces by Victor Flatt and by Alex Klass and Elizabeth Wilson

While many studies have suggested barriers to using CCS on a broad-scale basis -- including its high cost compared to traditional coal combustion, possible legal liability for underground storage gone awry, and difficulties in building the massive pipeline infrastructure that would be needed for commercial CCS -- no study to date has methodically addressed which of these barriers is greatest.  The answer to that question is important, because it implicates what CCS regulation should look like.

One study that I have been working on with colleagues from the University of Utah's Institute for Clean and Secure Energy takes up this question (and several others).  While we are still in the process of finalizing the report, here is a partial preview.

CCSbarriersThe study includes a survey of about 230 industry, professional, regulatory, and academic representatives involved in CCS.  One of the survey questions asked the participants to rate, on a 1 to 5 scale, a number of possible barriers to CCS commercialization.  A score of 1 means that the barrier is "no obstacle" to CCS commercialization, a 2 is a "minor" barrier, a 3 is a "measurable" barrier, 4 a "significant" barrier, and 5 a "critical barrier.

Four obstacles to CCS commercialization ranked highest in the survey: cost, lack of a carbon price or other financial incentive for using CCS, liability, and lack of comprehensive CCS regulation.

In one respect, this ranking is unsurprising.  Cost, liability, and the lack of climate change legislation have been widely acknowledged as problematic for the roll-out of CCS, so one might expect them to top the list.  Perhaps more interesting, however, is how highly the lack of CCS regulation rates.  What this means is that before CCS is likely to get off the ground, a predictable, comprehensive regulatory regime will need to be put in place.

The survey has more to say on that front.  Look for the full report later this summer.

-Lincoln Davies

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