Abby L. Harvey
GHG Monitor
8/28/2015
BILLINGS, Mont. — The greatest obstacle standing to large-scale adoption of carbon capture utilization and storage is not technical readiness, but a need for more investment toward deploying the technology to drive project costs down, a senior Department of Energy official said here this week.
“Financing is the main issue, not technology,” Julio Friedmann, DOE principal deputy assistant secretary for the Office of Fossil Energy, told an audience of U.S. and Chinese government and industry officials at the U.S.-China Clean Coal Industry Forum. “We want to continue to develop the technology to make the costs cheaper, and that’s something our office does with pride. We love the technology development. However, we also can reduce costs through deployment. We’ve seen that through other clean energy technologies, with wind and solar, with LEDs, with batteries. The more we deploy, the lower the costs get and the same is true with CCUS.”
Current costs of CCUS projects remain high as these efforts are still in the first generation of deployment. As with other technologies, it is expected that with each subsequent generation costs will fall rather quickly. Getting to that point, however, has proven difficult as government and industry have been reluctant to invest significantly in the demonstration of first-generation technologies. “What we do is we try to reduce the costs and one of the things I hear everywhere I go, whether it’s to companies or governments, whether it’s in the U.S. or China or Europe, the first thing I hear is it costs too much,” Friedmann said. “‘We love this technology, but it costs too much.’”
However, due to the expected continued use of fossil fuels, failing to deploy CCUS in the near term could raise overall costs of climate mitigation in the long term, Friedmann explained. Given the low price of fossil fuels, they are extremely likely to remain in the energy mix well into the future. “The low prices mean that fossil energy will be used for a very long time, and that’s essentially good news: coal, low-cost natural gas, low-cost oil, provide strong economic positives. They make low-cost power and low-cost energy and … we create wealth through this. But, we can also not ignore the consequences of global climate change and the role that fossil energy plays in that,” Friedmann said.
While CCUS might not be the lowest-cost low-carbon option is some areas, it will be in others, and for this reason efforts to deploy the technology and drive down the price will result in lower carbon mitigation costs in those regions for the long term.
“The cost of climate change management more than doubles if we do not have [CCUS], and the reason is simple, we use coal where we don’t use these other resources,” Friedmann said. “In some markets coal will be the lowest cost low-carbon energy when it’s matched with CCS. So, if you take that option off the table it means the cost of achieving the same climate goals goes up in those markets.”
