Australian news, and some related international items

Frydenberg’s carbon capture and storage – it’s a joke, really

Frydenberg’s carbon capture pipe dream, The Saturday Paper Paul Bongiorno 3 June 17
“… was with some bemusement that some of the old hacks who were on that trip greeted Energy and Environment Minister Josh Frydenberg’s announcement that he would remove the legislative prohibition on the Clean Energy Finance Corporation (CEFC) to allow it to support investment in carbon capture and storage (CCS). The very optimistic minister said such technology could reduce emissions by up to 90 per cent.

According to its mandate, the $10 billion so-called Green Bank must lend funds to viable projects that would lead to a healthy return on investment. Indeed the CEFC – which the Liberals under Tony Abbott wanted to abolish – has been very successful in funding renewable energy projects that have turned a nice profit for taxpayers……
Seven years ago Malcolm Turnbull’s assessment of CCS was that it was an industrial pipedream. He said it was sobering that “as of today, there’s not one industrial-scale coal-fired power station using carbon capture and storage – not one”. Both sides of politics had reached the same conclusion about its viability. Labor began withdrawing funds from research and the Abbott government shut down Rudd’s $1.7 billion Carbon Capture and Storage Flagships program. Industry had lost interest. Treasurer Joe Hockey returned nearly half a billion dollars of funds allocated to it back to the budget.

This week Frydenberg pointed out that government has invested $590 million in CCS and said it is now being successfully employed in three overseas power plants. But a closer look shows the lessons learnt from those plants mean its use has already peaked. The proponents of these plants are on the record stating they won’t be investing in any more. Renewables entrepreneur Simon Holmes à Court told the ABC that exponential cost blowouts and disappointing results are the rule.

One plant visited by the energy minister – Petra Nova in Texas – cost $US1 billion. It’s touted as the world’s largest and most successful operation, yet it captures only about 6 per cent of the output of its adjacent power station. That’s “an incredibly low bang for buck”, concludes Holmes à Court. Another CCS plant targeted to cost $US2 billion will open three years late and with an incredible final bill of $US7.5 billion.

Holmes à Court agrees with Frydenberg that CCS has a role to play in cutting emissions in industrial processes such as cement or steel production. Carbon can be captured in these cases for about $15 to $30 a tonne. “So with a healthy carbon price, those projects make sense,” he says. And there’s the rub. The very government wanting to be a champion of CCS for industry is denying it any incentive to spend a cent pursuing it. It’s commercially cheaper to keep polluting. Industry may get away with that but finance markets are now pricing climate change into lending for major energy projects. Bloomberg New Energy Finance earlier this year costed CCS coal at $352 a megawatt hour, compared with wind and solar at between $61 and $140 megawatts an hour.

It’s little wonder that experts can’t see private industry investing in new coal-fired power stations without substantial government input. But none of this seems to deter the resources and Northern Australia minister, the Nationals’ Matt Canavan……..


June 5, 2017 - Posted by | AUSTRALIA - NATIONAL, climate change - global warming, politics

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