Offshore staff
ABERDEEN, UK – Governments should step up their support for the carbon capture utilization and storage (CCUS) sector, according to Wood Mackenzie.
Only a small number of countries have policy and regulation in place to adopt CCUS today, said Mhairidh Evans, head of CCUS research.
Although the UK is among that cluster, Britain’s target of capturing and storing 20 MM metric tons per year by 2030 looks like a tall order, with some companies not able to progress projects due to slow negotiations for government funding.
Evans suggested the UK government needs to speed up funding processes, and private investment also has to stream in shortly afterward.
Wood Mackenzie estimates that the first four UK CCUS clusters will cost £65 billion ($81.6 billion) to develop to capture and store more than 500 MMmt of CO2 over their operational life cycles. The government’s commitment of £20 billion ($25.1 billion) toward that is critical to unlocking the remainder of private investment.
Also, companies need to execute transport and storage projects within a tight schedule.
Although technical and commercial preparations continue for the first four CO2 transport and storage hubs—East Coast Cluster, HyNet, Acorn and Viking—none have yet reached the FID stage. So, the developers face the prospect of building large-scale infrastructure in ever-shorter timelines.
Owners of close to 60 different emitters ranging from large power generating facilities to cement production and small biofuel plants have announced an intention to apply carbon capture before 2030.
However, only eight projects have been selected so far, and the emitters will need to implement costly novel technology. They may have difficulties accessing the complex government funding models, which can address this situation.
“Mostly, the technical workstreams are running ahead of the commercial and regulatory ones,” Evans said. “And there’s still a lot to do to bring emitters onboard.
“This is about building technology and infrastructure to reduce industrial emissions for decades to come. Ultimately, the UK has all the right ingredients and is going in the right direction, we just need to go a bit faster.”
