The ecoENERGY Carbon Capture and Storage Task Force wrote a report to the Minister of Alberta Energy and the Minister of Natural Resources Canada dated January 9, 2008. The Task Force's mandate was to provide advice on how government and industry can cooperate to facilitate and support the development of carbon capture and storage (CCS) opportunities in Canada. CCS is a process that separates carbon dioxide emissions from an industrial plant's process or exhaust stream and compresses and injects the carbon dioxide into deep underground geological formations. The Canada-wide impact for CCS may be as high as 600 megatonnes (Mt)/year, or roughly 40% of Canada's projected GHG emissions in 2050.
The report highlighted challenges facing the government and industry. Canadian greenhouse gas (GHG) emissions are up more than 25% since 1990. With this increase there is a growing concern that global emissions growth will drive up atmospheric carbon dioxide concentrations to levels not seen in 10 million years, bringing a growing risk of rapid climate change. In response to this concern, the federal government announced a national objective to reduce emissions by 20% from current levels by 2020, and 60 to 70% by 2050. The challenge, common to all nations, is how to make significant GHG emission reductions while continuing economic progress. Countries besides Canada that are working on CCS include Australia, Norway, the U.K and the U.S.
The Task Force states CCS is an essential and viable way to achieve significant GHG reductions. Canada is seen as an ideal place for CCS because it can be built on Canada's existing energy infrastructure and its fossil energy endowment while managing the associated GHG emissions. There is immense storage potential in the reservoirs that once held Canada's oil and gas reserves and the deep saline aquifers underlying these rock units. The Western Canadian Sedimentary Basin (WCSB) is seen as an ideal location for CCS because of the co-location of large industrial GHG sources with the vast storage potential. Other storage opportunities exist in Atlantic Canada, southern Ontario and just south of the Canadian border.
Enhanced oil recovery (EOR) is another opportunity in the WCSB. This is a process whereby carbon dioxide is injected into existing oil reservoirs to extract more resource. Preliminary estimates indicate that 450 Mt of storage capacity may be currently available in oil fields that are conducive to EOR.
The CCS component technologies (capture, transport and storage) all exist today - the missing link is the integration and application of these components in commercial facilities at a large-scale.
The Task Force states that government must commit public financial support for CCS and industry must commit to building and operating CCS projects immediately. The two main barriers facing CCS today are the financial gap associated with CCS projects and current gaps in regulatory frameworks. The Task Force set out the following recommendations to Federal and Provincial governments. The first group of immediate actions are intended to address the two main barriers facing CCS:
Three Immediate Actions (before 2010):
Federal and Provincial governments should allocate $2 billion in new public funding to leverage the billions of dollars of industry investment in the first CCS projects. This funding should be distributed expeditiously through a competitive request for proposals process so that these phase-one projects are operational by 2015.
Authorities responsible for oil and gas regulation should provide regulatory clarity to move the first CCS projects forward by: quickly confirming legislation and regulation related to pore-space ownership and disposition rights; clearly articulating the terms for the transfer of long-term liability from industry to government; and increasing the transparency of regulatory processes.
Federal and Provincial governments should ensure as much opportunity for CCS projects under the GHG regulatory frameworks as for any other qualifying emission reduction option. This will require the creation of CCS-specific measurement and crediting protocols.
The Task Force recommended the following next three steps to continue CCS development:
Industry and both government levels should form a collaborative framework to including an advisory group over the next two years to coordinate discussion, to institutionalize learning, and to potentially carry out specific aspects of immediate actions 1, 2 and 3; this may evolve into a more formal organization as future needs are assessed.
Federal and Provincial governments should provide stable financial incentives to help drive CCS activities beyond the phase-one projects. These may include the continuation of RFPs for phase-two projects, carbon dioxide storage incentives, and/or the use of tax and royalty incentives.
Canadian-based research organizations and technology developers should focus research and demonstration efforts on CCS to achieve two goals: to drive down the cost of existing CCS technologies; and to enable the deployment of next generation CCS technology and processes. The Federal and Provincial governments should provide financial support for these activities.
The Task Force believes that the following milestones can be achieved by 2015 if these recommendations are followed:
Five Mt of annual GHG emission reductions from large industrial facilities
A first wave of industrial facilities capturing and storing carbon dioxide (three to give operating projects)
Global leadership in CCS technical capabilities and expertise
First-mover advantage in carbon dioxide crediting protocols, disposal rights and disposition legislation, and long-term liability solutions
World-class CCS institutions addressing commercial, legal and regulatory requirements
A framework for planning what's next for CCS in Canada
For a copy of the report, please see http://www.nrcan.gc.ca/com/resoress/publications/fosfos/fosfos-eng.pdf