What's the upside to humanity's greatest energy challenge - capturing and sequestering the carbon put out by coal-fired power plants and other industrial emitters before it causes runaway global warming?
According to Pike Research, carbon capture and sequestration could represent a $128 billion market over the next 20 years - and that's assuming a base-case, business as usual approach to the problem.
More aggressive carbon limits by government - and buy-in from industry - could boost that market to about $221 billion by 2030, according to Pike's report released Wednesday.
That wide range represents the state of uncertainty over carbon capture and sequestration, or CCS. The Intergovernmental Panel on Global Change (IPCC) has said that CCS has the potential to keep 220 to 2,200 gigatons of CO2 from entering the atmosphere over the next century, a range representative of the many regulatory, technological and economic uncertainties involved.
Real-world examples of working CCS systems are hard to come by. While many pilot projects are underway to capture carbon from oil and gas wells, coal plants and other industrial sources, to date no commercial-scale power plants capture and store their carbon, Pike Research managing director Clint Wheelock noted in a prepared statement.
Of course, plans to do just that are underway. American Electric Power turned on the first system to capture carbon emissions from its Mountaineer coal-fired power plant in West Virginia and store the carbon in underground caverns.
But that project is now capturing only about 2 percent of the plants' emissions, though AEP hopes to raise that to 18 percent in the coming years, aided by $335 million in federal funding, the Wall Street Journal reports.
That funding is part of the nearly $1 billion the Department of Energy gave out for CCS projects earlier this month (see Permanent Storage, Oil Recovery Part of $3B in Carbon Capture Projects). Many other CCS projects are being planned in the United States and abroad - China, the world's biggest carbon dioxide emitter, is a particular focus of attention (see GE Gets Into 'Cleaner Coal' in China and Duke Energy, China's Huaneng Group Collaborate on Coal Carbon Capture).
CCS comes at a cost, of course. Pike's report estimated that adding CCS to new and existing power plants will raise the price of electricity by 50 percent to 75 percent.
Putting a price on carbon will be critical to making CCS make economic sense, Pike's Wheelock noted. Experimental CCS plants will be able to sequester and store CO2 at a cost of $80 to $120 per ton (€60 to €90), according to a McKinsey report on the subject.
But observers of the United Nations meeting now underway in Copenhagen to craft a global carbon reduction treaty are well aware of how difficult this may be. Poorer nations walked out of the meeting on Monday, protesting what they called a lack of pledges of financial support from richer nations, and hopes for a legally binding accord are dimming (see U.S. Commits $85M for Clean Energy in Developing Nations).
