Is Capturing and Storing CO2 Emissions from Fossil Fuels a Viable Climate Solution?

Colleen and Steve discuss:

• how carbon capture and storage technologies work
• the pros and cons of each technology
• whether they are a viable climate change solution
• what incentives have been included in the Inflation Reduction Act

Opener (0:00-0:19)
Intro (0:19-2;02)
Interview p1 (2:02-13:03)
Break (13:03-13:54)
Interview p2 (13:54-27:39)
Outro (27:39-29:00)

Editing: Colleen MacDonald
Additional editing and music: Brian Middleton
Research and writing: Pamela Worth
Executive producer: Rich Hayes
Host: Colleen MacDonald

• Lessons from the Petra Nova and Kemper Projects
• Climate Solutions

Colleen: As one of my colleagues at the Union of Concerned Scientists likes to say, there’s no one silver bullet to address the climate crisis.

Instead, what we need is silver buckshot—that is, a lot of useful solutions all at once, to tackle multiple facets of this multifaceted threat.

For example: electric cars on their own are not a climate change solution.

Electric cars powered by renewable energy, along with massive investments in public transit, electrified buses and subways, and electric freight trucks on our highways? That’s a great set of solutions.

Today, I’ll be talking about carbon capture and storage, another climate solution that just isn’t a solution on its own with my colleague Steve Clemmer, Director of Energy Research & Analysis at UCS. Carbon capture and storage is exactly what it sounds like: technologies that trap carbon dioxide in the air and store it in the ground.

This topic can be fraught, since folks in the know are worried that to outsiders, carbon capture and storage seems like magic—a real silver bullet. You mean we can trap carbon in the ground and keep it out of the atmosphere? Marvelous!

But of course, it’s just one of many potential solutions that, if deployed, needs to work in tandem with others. And as Steve Clemmer will warn us, this technology is not an excuse to keep burning fossil fuels. We talk about the potential and pitfall of carbon capture and storage, and what else we need to keep throwing everything we’ve got at the climate crisis.

Colleen: Steve, welcome to the podcast.

Steve: Hi, Colleen. Thanks. It's great to be here.

Colleen: Yes, you know, today, I want to talk about carbon capture, utilization, and storage. In the simplest terms, it's a technology that would capture carbon dioxide emissions or global warming emissions and prevent them from entering the atmosphere. And the reason I want to talk to you about this today is because incentives for this technology are expanded in the Inflation Reduction Act. And there are also incentives in the Infrastructure Investment and Jobs Act.

So, let's just start with the basics. What is this technology and how does it work?

Steve: Yeah, so, the carbon capture and storage technology basically involves three major steps, capturing the CO2 emissions at the source, compressing it for transportation, and then injecting it and storing it in [00:01:00] underground, deep geologic formations. It's also possible to capture the carbon and utilize it for enhanced oil recovery, or in other valuable products such as carbonates and beverages.

This is often referred to as carbon capture, utilization, and storage, or CCUS.

Colleen: Yeah, so what are some of the ways to capture the carbon?

Steve: So, the carbon capture involves separating the CO2 from other gases that are produced mainly at large industrial facilities, such as steel mills, or cement plants, or refineries, as well as at coal and natural gas-fired power plants. And there's really three main technologies that are technically capable of capturing 90% or more of the CO2 emissions from these facilities. So, one of these is called pre-combustion capture, and that involves removing the CO2 when it's in a more concentrated and pressurized form. This approach is best suited for capturing emissions from industrial processes, the process emissions, or gasifying coal or biomass and removing that CO2 prior to combustion at those power plants.

Another form of the technology is called post-combustion capture, and that involves removing CO2 from the exhaust gases of those facilities using chemical processes. This approach is more challenging than pre-combustion because air, which mostly consists of nitrogen, is used to fuel the combustion and it dilutes the CO2.

The third main approach for capturing carbon is called oxy-fuel, and that involves combustioning fossil fuels with pure oxygen rather than air. And that results mainly in CO2 and water vapor. The higher concentration of CO2 from this process can lower the cost of carbon capture and offset the additional costs of purchasing the oxygen.

Colleen: So once you've captured the carbon dioxide what do you then do with it?

Steve: Once the CO2 is separated, it's compressed for transportation. This means that increasing the pressure so that the CO2 behaves more like a liquid. The compressed CO2 is then dehydrated before being sent to the transportation system. And pipelines are the most common mode of transporting large quantities of CO2, but ships are also an alternative for some parts of the world.

The final step, which is storage, is, you know, injecting the CO2 into deep underground rock formations where it can be permanently and safely stored.

Colleen: So Steve, how do you inject something into a rock formation?

Steve: Yeah, so, some of the geologic formations that we're talking about would include things like deep saline aquifers, depleted oil and gas fields, and unmineable coal seams, are the three kind of main things that have been identified. And, there's a lot of experience over a number of years of injecting fluids and drilling in the oil and gas industry into these kinds of formations.

And, depending on the formation, the CO2 can stay down there because of, cap rocks on top of them and the pressure of the CO2 that's in the formation can keep it down in those formations. The U.S.. Department of Energy estimates that these geologic formations could store hundreds of years' worth of U.S.. CO2 emissions at current rates.

And about 90% of that technical potential is actually in deep saline aquifers, depleted oil and gas fields, where it's typically been used for a process called Enhanced Oil Recovery to produce more oil from those fields. That actually only represents about 2% to 7% of the potential in unmineable coal seams and even smaller share. it's important to recognize that, , saline aquifers are seen as the best source of storage for maximizing emission reductions and achieving long-term permanent storage.

Colleen: Can you give us a quick definition of a saline aquifer?

Steve: Yeah, so, a saline aquifer is a geologic formation of porous sedimentary rocks containing saltwater, and these reservoirs are typically about more than a half a mile below the Earth's surface

Colleen: And there’s also direct air capture.

Steve: So yeah, another application that I wanted to mention is actually removing carbon dioxide directly from the atmosphere with technologies such as direct air capture, or actually bioenergy facilities that you can combine with carbon capture and storage to achieve negative emissions. And a direct air capture facility uses chemical reactions to pull the CO2 out of the air, and when the air moves over these chemicals, they selectively react with and trap the CO2. Some of the leading systems that use this technology, either use liquid solvents or sorbents, that are composed of common chemicals that are already used in other applications.

It's also worth mentioning that a direct air capture is a very energy-intensive process. And the key really to making sure that you're achieving negative emissions is that you're using zero carbon electricity to power that process and not fossil fuels, otherwise, that could result in additional emissions.

Colleen: So, how much storage potential do we have now in the U.S.?

Steve: Yeah, so, the Department of Energy has done some analyses of this over the years and some really interesting mapping of where these formations are. And the storage potential, is hundreds of years' worth of U.S. CO2 emissions at the current rates of those emissions in the United States. So, it's very significant. There's not really a limit in terms of the storage potential. It's pretty vast.

Colleen: How long have scientists been working on this technology?

Steve: Yeah, so, CCS is about a 50-year-old technology that has been demonstrated and deployed in a somewhat limited way and with varying results. Currently, globally, there are about 30 commercial scale carbon capture facilities operating, and they're capturing and storing about 43 million metric tons of CO2 per year, according to the Global CCS Institute.

Now, the emissions that are being captured and stored are equivalent to about 1% of current U.S. emissions, so a pretty small amount. And about three quarters of that captured carbon is used for enhanced oil recovery to produce more oil by the oil and gas industry. And only a quarter of it is stored in saline aquifers. And part of the reason for that is because when you use the capture carbon for enhanced oil recovery, you're producing more oil and that results in additional revenues that you can incur by selling that oil into the market. And so, it makes CCS more cost-effective for the companies that are doing that. With saline aquifers, you're essentially just injecting the CO2 into those aquifers and it's going to be stored there. You're not really getting other products out of it.

But the benefit is that you're going to achieve greater emission reductions and those emissions are gonna stay down there on a more permanent basis if you have carefully selected those sites.

Colleen: Are these technologies ready to go on a large scale?

Steve: The technology or the component technologies have been demonstrated and deployed, but certainly, the technology has not been deployed at a huge scale. And the industry, frankly, has had a poor track record in deploying projects on time and budget, and achieving high capture rates, particularly at power plants.

Over the past 20 years, nearly 90% of the proposed CCS capacity in the power sector has either failed at the implementation stage or was suspended early. And there's been, a few really high-profile failures of deploying CCS at coal plants in the United States. For example, a large utility, Southern Company in the Southeast pulled the plug on coal, a CCS project at the Kemper plant in Mississippi in 2017.

The cost of that project had more than doubled from 2.9 billion to 7.5 billion. Ratepayers actually got stuck with a billion dollars of the cost overruns, and investors had to absorb about $2.7 billion. And that project actually never even operated, they ended up canceling it and actually imploding the equipment they had installed at the site because it wasn't working properly and cost-effective. Despite this mixed track record, there really has been a renewed interest in CCS in the past few years.

Colleen: So how many projects or proposals are in the works?”

So globally, right now, there's more than 200 new facilities proposed to capture about 220 million metric tons of CO2 per year by 2030, according to the International Energy Agency. And plant projects have increased by about ninefold since 2018.

That's due in part to some of the new policies that have been adopted in the U.S. and other parts of the country. In the United States, the number of plant projects have actually more than quadrupled to about 130 over the past few years, according to a database that’s maintained by the Clean Air Task Force. And most of these projects in the U.S. are in the industrial sector, at biofuels facilities. But there's also been a significant increase in proposed projects at power plants, direct air capture facilities, and actually a few CO2 pipeline projects as well.

There is definitely a lot of interest. And, it remains to be seen, how many of these projects can be deployed and over what timeframe.

Colleen: Well, I have so many questions about these technologies. Can you lay out the pros and cons for us?

Steve: Sure, I'd be happy to. So, one of the pros is the technology has been successfully demonstrated and deployed, not necessarily at the scale we need, but definitely the component technologies have been demonstrated. CCS has also been identified as a key approach for reducing emissions in the industrial sector. That sector really has limited alternatives for certain energy intensive industries that are a large source of emissions, both in the U.S. and globally.

Another pro is that that CCS advocates will tell you is that it gives the fossil fuel industry an option to continue operating in a carbon-constrained world. That industry does provide an important source of jobs and economic activity for some communities.

CCS could also be an important part of a portfolio of solutions for achieving our climate goals. As you've heard many people say, there's no silver bullet to addressing climate change. And we've waited so long to really take meaningful action to address climate change, and we need to reduce emissions as much as we can, and as fast as we can. And frankly, all low-carbon technologies do face challenges in ramping up deployment. However, CCS has some additional challenges that I'll get to in a second.

Colleen: Yeah, I mean, one of the things that I do worry about is that this technology will keep us from phasing out fossil fuels.

Steve: So, that's one of the cons, and there's a very long list of cons. You know, the concerns that CCS, including enhanced oil recovery with CCS could be used as a loophole by the industry to perpetuate the use of fossil fuels. The net zero emissions plans that the oil majors have recently began producing, which is mainly in response to shareholder demands, all lean heavily on CCS rather than reducing production.

And this is a problem because the plans don't provide hard numbers showing CCS will make a significant contribution to reducing emissions. And, the oil industry, CCS projects-to-date have primarily utilized the captured carbon for enhanced oil recovery to produce more oil. And corporate CCS estimates often neglect so-called Scope 3 emissions and those emissions are not from their operations, but rather from consumers that are burning the fuel in cars, and buildings, and industry.

And those emissions account for the vast majority of the total emissions. So the industry is really only counting their process and operational emissions and not those other sources of emissions.

Steve: So, that's one of several cons. there's a few others. the industry has experienced high cost and performance issues, and projected cost reductions have not materialized and have made it difficult for CCS to compete with other low-carbon alternatives like wind and solar. The industry has also had difficulty achieving the high carbon capture rates that they've promised.

Deploying the technology at scale is another issue. Recent deep decarbonization studies have shown that the scale of CO2 transport and storage that would be needed for CCS deployment could range from one to two times the current U.S. oil production on a volume-equivalent basis by 2050. So imagine, capturing, transporting, and storing the equivalent amount that we're currently doing for oil in the United States, or maybe two times that amount. So significant. And siting and permitting all those projects, and pipeline and storage infrastructure is going to be extremely challenging.

And while CCS can reduce carbon dioxide emissions, it doesn't necessarily address other harmful environmental impacts of using fossil fuels, such as upstream methane leakage, air and water pollution, and waste disposal issues. To make matters worse, these impacts could actually increase because CCS projects require additional energy for the carbon capture process. What this means is that you need to mine, transport, and burn more fossil fuels to produce the same amount of electricity or energy as a plant without CCS. So specific policies and guardrails are really needed to reduce those impacts.

A related concern is that existing industrial facilities and power plants are disproportionately located in environmental justice and low income communities that have already been experiencing the negative pollution and public health impacts of these facilities for decades. Deploying CCS in these communities requires that potential adverse outcomes are explored before these projects are given approval, and that affected communities are part of that decision-making process.

To address climate change and achieve our climate goals, we really need to significantly phase out or reduce fossil fuel use over time. And strategies like increasing renewable electricity use, energy efficiency, or electrification of transportation, buildings, and industry are going to significantly reduce the demand for oil and natural gas as well as coal. And an extensive build out of CCS at refineries, or at gas processing plants, at precisely the time that we are shifting away from the main products that these facilities produced, could lead to stranded assets in the future.

Colleen: This really brings me to the question of whether we really need CCS to be able to achieve our climate goals and reach net zero carbon emissions, both in the U.S. and globally by mid-century.

Steve: So, most studies, deep decarbonization studies show that a sharp phase down in fossil fuels and rapidly scaling up investments in electrification efficiency and renewables, as I just mentioned, that those are gonna make the greatest contribution to achieving net zero emissions by 2050, and limiting global average temperature increases to one and a half or two degrees Celsius. The contribution from CCS is smaller, but it's not insignificant, and ranges from roughly about 10% to 15% of global emission reductions by 2050.

And probably the two most authoritative sources for these kinds of studies at the international level would be the International Energy Agency, or IEA. And the UN's Intergovernmental Panel on Climate Change, or the IPCC.

The IEA has said in a variety of different ways that it's basically impossible to reach our climate goals without CCS. In their most recent World Energy Outlook, that came out just a few weeks ago, they did a net zero scenario, and they found that CO2 could reduce global emissions by about 1.2 gigatons per year in 2030, and about 6.2 gigatons per year, or roughly 12% of current global emissions by 2050.

The EIA's long-term projections for CCS are in the range of other studies, but I'm actually really highly skeptical about their projections for 2030 being achievable. Essentially, it would require the equivalent of about 10 new CCS facilities being deployed every month for the next seven years, for about a total of 840 facilities operating by 2030, compared to currently having only 35 of those facilities, or 30 to 35. Somewhere in that range, currently.

EIA's own data shows we would need about five times the capacity that is currently being planned globally, and a whopping 27 times the current global capacity to achieve these levels of CCS in 2030. So that's a big lift, given the track record that I mentioned earlier of the technology.

Now, the IPCC has said that carbon capture transport, removal, and storage is critical for achieving economy-wide net zero emissions by mid-century. And, they lay out multiple pathways for limiting warming to one and a half degrees Celsius. And most of those pathways include CCS and carbon dioxide removal technologies to some extent.

Their most recent sixth assessment report also highlights the wide range of technical, economic, and social challenges and barriers that would need to be overcome to achieve these projections. So, they do present a balanced view of it about what actually is gonna need to happen to get there.

Colleen: So, what incentives were included in the Inflation Reduction Act and the Infrastructure Investment and Jobs Act to promote CCS?

Steve: Yeah, these new laws included significant incentives for CCS as well as other technologies, but particularly for CCS. The Inflation Reduction Act included both an extension and a significant increase in the so-called 45Q tax credits. And that 45Q is in reference to the IRS code for that. But for industrial facilities and power plants, the tax credit values were increased to $85 per metric ton of CO2 stored in saline aquifers, and to $60 per metric ton for CO2 stored in oil and gas fields that would be used for enhanced oil recovery, or for beneficial utilization of CO2. And power plants are required to capture 75% or more of their baseline CO2 emissions to be eligible.

The Inflation Reduction Act also included increased incentives for direct air capture facilities. And those values were more than tripled to $180 per metric ton for CO2 for saline aquifers, and $130 per metric ton for enhanced oil recovery in oil and gas fields. So a very significant increase on that front. And facilities that qualify for these incentives are required to start construction by the end of 2032, and they would receive tax credits for 12 years instead of the 10 years that most other technologies get. So it's a little bit more generous timeframe as well.

There's also some provisions included that would allow project owners that do not have sufficient tax liability to receive direct payments instead of tax credits for the first five years. And for entities like nonprofits, co-ops, and municipal utilities that do not pay taxes, they could get direct payments for the full 12 years. The tax credits can also be transferred to other entities that have sufficient tax liability, so that provides an important level of flexibility for owners of these projects.

Colleen: Then then, what about the infrastructure law that was signed last year?

Steve: That included an additional $12 billion in funding for CCS through 2026. And really, the biggest ticket items in that funding included $3.5 billion for research, development, and demonstration. And that included some funding for large-scale demonstration projects.

There was $4.6 billion for CO2 transport and storage, infrastructure and permitting. And then finally, $3.6 billion for carbon removal, and most of that is going to create four regional direct air capture hubs around the country. It's worth noting that the decarbonization studies that I mentioned earlier do not include these new incentives. However, there have been some recent analyses of these laws and announcements by developers, that showed that these new incentives could have a significant impact on near-term development.

Colleen: What are some of the key takeaways for our listeners?

Steve: Yeah, great question. So, while CCS is seen by many as an important solution for addressing climate change, as I've indicated, there are several technical, economic, environmental, and social challenges that will need to still be overcome, to really scale up this industry and make a meaningful contribution.

Given these challenges and trade-offs, it's really important that policies incentives for promoting CCS include strong regulations for measuring, monitoring, and verifying emission reductions from CCS, as well as including strong guardrails to avoid some of the unintended consequences I was noting earlier related to environmental impacts from other parts of the fuel cycle, you know, impacts on environmental justice and low income communities, where a lot of these projects are being located.

So, it's really important that we include those kinds of guardrails and regulations to make sure that we're achieving emission reductions from CCS in appropriate way.

Colleen: Well, Steve, thanks so much for joining me on the podcast. This was one of our more technical episodes, but you've really laid it out clearly. And I thank you for your summary at the end, which kind of helps us understand how we should be moving forward. Thanks so much for joining me.

Steve: Thank you, Colleen. It was great to be here.

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