Peter Jones: Brave indeed to count on this new future for energy

Published on Thursday 14 May 2009 21:22

CARBON capture and storage, we are told by the Scottish and British governments, is the glowing new future, alongside renewables, for our energy industry. I hope they are right. But they might be wrong, and here's why.

The theory looks good. You stick some clever equipment on coal-fired power station chimneys which captures the that normally goes into the atmosphere. You then compress it, shove it into a pipe which takes it out to sea, and then stuff it down a hole into rocks, where it stays buried forever.

Brilliant! It means you can carry on burning coal to make electricity and you are not adding to the greenhouse gases which threaten to make our planet uninhabitable through climate change.

And there is a bonus. If we can be the first to show that it works on a big scale, thousands of jobs can be created here and millions, perhaps billions, of pounds can be earned for the economy through export of the technology and expertise. And boy, don't we need that?

If it all works, that is. But that is a very big "if".

At a recent press conference on carbon capture and storage (CCS) headed by First Minister Alex Salmond, when I questioned some of the assumptions which say there is no "if", I was treated as though I had just flown in from Mexico and sneezed over everybody.

It didn't help that Salmond talked grandly about Scotland having a "huge comparative advantage" in the technology. In international trade economics, comparative advantage occurs when two or more countries can produce the same thing, be it wheat or televisions, but one can do it a bit cheaper than the rest.

Nobody has any idea whether any country has a comparative advantage in CCS because nobody knows for sure how much it will cost.

It turned out that what he meant was a resource advantage – that in the Scottish North Sea there appears to be enough capacity to store not just Britain's but much of Europe's excess carbon output.

But Scotland is not unique. Norway has as much storage space and although the rest of Europe appears not to have much offshore storage, I find it hard to believe they have no suitable rocks on land either.

Anyway, I was firmly told at the press conference, by a sedimentary geologist, that the electricity produced by CCS would cost about 6.6p per kilowatt hour (kWh), not far above current electricity prices of between 5.5p and 6p per kWh. When I asked how this was calculated, the geologist's beard bristled and I was curtly told it was the best estimate available from a whole variety of estimates produced by experts.

I tried this best estimate out on a power company executive and he fell about laughing. If the cost was known, he pointed out, the British government would not be about to spend billions on pilot projects to find out what CCS costs.

An engineer might have cited a paragraph from a recent voluminous report on CCS from the International Panel on Climate Change.

It says that such estimates "are typically based on an optimised, least-cost analysis that does not adequately account for real-world barriers to technology development and deployment, such as environmental impact, lack of a clear legal or regulatory framework, the perceived investment risks of different technologies, and uncertainty as to how the cost of CCS will be reduced".

In short, life's practicalities can make a mess of theory and estimates.

And, as one of my correspondents, Ian Moir, argued in an e-mail, CCS requires large amounts of energy to compress the carbon, which could amount to about 50 per cent of a power station's total electricity output.

This is one of the costs which can only be tested by a real CCS project. Actually, ScottishPower, which hopes Longannet will be the lead pilot project, currently believes it could be less than 25 per cent, which may not necessarily reduce the station's generating capacity (for consumers) from 2,400MW to 1,800MW.

Why? Because Longannet currently gets only about 35 per cent of the energy potential of the coal it burns. Adding CCS would, on current estimates, reduce that to 27 per cent, a reduction of 8 per cent. However, Longannet's boilers are old, and replacing them with the latest type, which will need to be done eventually, could increase the burning efficiency, with CCS, to around 50 per cent. New turbines could also increase the electricity output.

All the same, if the CCS technology works, technically and economically, and we go on to apply it to carbon producers such as petrochemical works, more generating capacity will be needed.

Which is why, apart from it being foolish to assume that CCS is a slam-dunk win for the Scottish economy, it is also foolish to rule out new nuclear stations.

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