The Institute for Energy Economics and Financial Analysis (IEEFA) reports in its 'The Carbon Capture Crux – Lessons Learned' report that underperforming carbon capture projects considerably outnumber successful projects globally, and by large margins, with both the technology and regulatory framework found wanting.

The report studied 13 flagship large-scale carbon capture and storage (CCS) or carbon capture, utilisation and storage (CCUS) projects in the natural gas, industrial and power sectors in terms of their history, economics and performance. These projects account for about 55% of the total current operational capacity worldwide.

“Seven of the thirteen projects underperformed, two failed and one was mothballed. CCS technology has been going for 50 years and many projects have failed and continue to fail, with only a handful working.

“Many international bodies and national governments are relying on carbon capture in the fossil fuel sector to get to net zero and it simply won’t work,” says IEEFA report author Bruce Robertson.

He adds that, although there is some indication carbon capture might have a role to play in hard-to-abate sectors, such as cement, fertilisers and steel, overall results indicate a financial, technical and emissions-reduction framework that continues to overstate and underperform.

The IEEFA study found that Shute Creek, in the US, underperformed its carbon capture capacity by about 36% over its lifetime; Boundary Dam, in Canada, by about 50%; and the Gorgon project, off the coast of Western Australia, by about 50% over its first five-year period.

“The two most successful projects are in the gas processing sector, namely Sleipner and Snøhvit, in Norway. This is mostly owing to the country’s unique regulatory environment for oil and gas companies.

“Governments globally are looking for quick solutions to the current energy and ongoing climate crisis, but latching onto CCS as a fix is problematic,” Robertson says.

For example, during the last week of August, the Australian government approved two new massive offshore greenhouse-gas storage areas, saying CCS “has a vital role to play to help Australia meet its net-zero targets. Australia is ideally placed to become a world leader in this emerging industry”.

However, carbon capture technology is not new and is not a climate solution, Robertson emphasises.

“As our report shows, CCS has been around for decades, mostly serving the oil industry through enhanced oil recovery (EOR). Around 80% to 90% of all captured carbon in the gas sector is used for EOR, which itself leads to more carbon dioxide (CO₂) emissions.”

About three-quarters of the CO₂ captured each year by multibillion-dollar CCUS facilities – about 28-million tons of 39-million tons total capture capacity globally – is reinjected and sequestered in oilfields to push more oil out of the ground.

History shows CCS projects have major financial and technological risks. Close to 90% of proposed CCS capacity in the power sector has failed at implementation stage or was suspended early, including Petra Nova and the Kemper coal gasification power plant in the US.

Further, most projects have failed to operate at their theoretically designed capturing rates. As a result, the 90% emission reduction target generally claimed by the industry has been unreachable in practice. Finding suitable storage sites and keeping it there is also a major challenge, as the trapped CO₂ underground needs monitoring for centuries to ensure it does not re-enter the atmosphere, he adds.

The International Energy Agency says annual carbon capture capacity needs to increase to 1.6-billion tonnes of CO₂ by 2030 to align with a net-zero by 2050 pathway.

“In addition to being wildly unrealistic as a climate solution, based on historical trajectories, much of this captured carbon will be used for enhanced oil recovery,” says Robertson.

CCS CONSIDERATIONS
Meanwhile, the report identifies interim considerations for CCS projects, if no alternative solutions to emissions reduction are found.

“Safe storage locations must be identified, and a long-term monitoring plan and compensation mechanism in case of failure developed. CCS project must not promote EOR.”

Further, to avoid project liability being handed over to taxpayers, as is currently the situation with Gorgon, large oil and gas companies mainly benefiting from CCS at their gas developments must be liable for any failure or leakage and monitoring costs of CCS projects, specifically if they get subsidies, grants and tax credits for capturing the carbon, Robertson emphasises.

“Carbon capture must not be used by governments to greenlight or extend the life of any type of fossil fuel asset as a climate solution,” he adds.

More research could be done on CCS applications in industries where emissions are hard to abate, such as cement, as an interim partial solution to meeting net-zero targets.

“However, as a solution to tackling catastrophic rising emissions in its current framework, CCS is not a climate solution,” Robertson says.