The first carbon dioxide storage project in the Southern Hemisphere was launched today in southwest Victoria, Australia. New Zealand energy company, Solid Energy, is a major investor and founding member of the company set up to own and operate the Otway project. The A$40 million project, which will see 100,000 t of CO2 injected to a depth of 2 km and then extensively monitored, is designed to demonstrate that carbon storage (geosequestration) is technically and environmentally feasible and is ready for widespread commercial application. The project has been developed over the last 10 years by the Australian Cooperative Research Centre for Greenhouse Gas Technologies (CO2CRC).
Solid Energy CEO, Dr Don Elder, says: “Today’s launch is a major milestone in global efforts to address climate change and a very significant day for Solid Energy as a key participant in this project since 2004. Carbon capture and storage is already proven technology used in a number of applications around the world and is expected to be commercially utilised in new coal-fired power stations over the next five to 10 years. The importance of the Otway project is that it includes a monitoring program that is the most comprehensive of its type in the world. It will establish base performance data for use in commercial applications.
“For Solid Energy, the promise of carbon capture and storage includes its potential use in a coal to liquid fuel (diesel) plant that we’re investigating, based on our extensive Southland lignite resources. The timeframe for this project would see first product some eight to 10 years from the time of a decision to proceed and, given the rising price of oil internationally, carbon capture and storage technology could be a very attractive option to address the CO2 emissions of such a plant. This would be one of a number of options for managing the CO2 footprint including purchasing credits and forestry offsets.
“Coal remains the world’s most abundant source of secure, reliable and affordable energy and is relied on in most countries to support economic prosperity and social well-being. In New Zealand, Solid Energy supplies coal to underpin electricity security and to power many of our key industries and exporters including dairy, steel, cement, timber and industrial processing, as well as schools, hospitals and other public buildings.
“Supplying secure affordable energy to these customers makes a significant contribution to New Zealand’s economic competitiveness. Technology that reduces the emissions from fossil fuel use, coupled with new cleaner ways of using coal, such as coal seam gas we are trialling in the Waikato, will make a big contribution to our energy security in New Zealand.”
Solid Energy is contributing more than A$2 million towards the research of the Centre, which is in turn part of a 20-year, NZ$100 million investment the company is making in renewables and new cleaner ways of using coal. Solid Energy is founding shareholder, with several Australian coal, oil and gas companies, in the company set up to own and operate the Otway project and has had a significant role in the technical, legal and commercial aspects of that company.
CO2CRC Chief Executive, Dr Peter Cook, says the Otway Project will play an important role in demonstrating the safety of geosequestration technology to communities, industry and governments worldwide. In addition to demonstrating the deep geological storage of carbon dioxide through the Otway project, CO2CRC is also a leader in the research and demonstration of carbon dioxide capture technologies.
“The CO2CRC Otway project also clearly demonstrates the great advantages of collaborative research and the participation of national and international industry in developing low-emission technology to reduce greenhouse gas emissions.”
Minerals Council of Australia Chief Executive Mitchell H. Hooke said: “The CO2CRC Otway Project is a key strategic initiative in the global challenge of addressing climate change – the world’s largest global research and carbon storage demonstration project.
“There simply cannot be a global solution to managing climate change without a clean coal strategy as part of a suite of policies to reduce greenhouse gas emissions in an international response to managing climate change. Economic and energy security concerns mean that coal will remain an indispensable contributor to energy generation in the years ahead. This reflects the fact that coal is plentiful in the economies that will dominate the global economic scene in the period to 2050 – China, the USA and India. For the foreseeable future, Australia and the world will continue to rely on coal and other fossil fuels to meet energy demand,” Hooke pointed out.
“The International Energy Agency has forecast that global coal demand could increase from 4,154 Mt in 2005 to 7,173 Mt in 2030. By 2030, China and India will account for 60% of total world coal demand, up from 45% in 2005. It is therefore vital to have projects which further the goal of achieving successful demonstration and deployment of carbon capture and storage to provide clean coal power generation. This technology is critical to underpin the longer-term effectiveness of the proposed Emissions Trading Scheme which will for the first time put a market price on carbon,” Hooke said.
“The MCA has long advocated the need for a coherent suite of policies to address the challenge of climate change including:
- focusing on providing incentives for the demonstration and deployment of new step-change technologies such as carbon capture and storage
- an efficiently designed market-based mechanisms including a cap and trade Emissions Trading Scheme
- ensuring Australia’s climate change policies form part of a realisable international solution to the impacts of human induced greenhouse gas emissions
- adaptation policy for industry and Australian society to ensure a managed transition to new circumstances and conditions resulting from climate change;
- effective communication of the rationale for each element of climate change policy to the Australian community.
Carbon capture and storage (CCS) involves the separation of CO2 from other gases emitted in coal combustion or gasification processes and injection of the carbon dioxide deep underground into geological formations. New low emissions power plants with CCS have the potential to reduce greenhouse gas emissions from coal-fired power plants by approximately 80 to 90%, including taking into account the energy requirements for capture. ABARE has projected that, with CCS, Australia could reduce emissions against business as usual by 31% by 2050. The European Union has projected that CCS technologies could reduce global emissions by about 14% by 2030.The European Union hopes to have up to 12 CCS projects underway before 2020, while considerable work is also underway in the USA and China.
