Carbon Capture Leads U.K. Low Carbon Energy Drive

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland) -- The implementation of carbon capture and storage (CCS) technology could save the U.K. up to £45 billion ($71.4 billion) in energy costs over the coming decades.

The finding is one of the highlights from a series of in-depth reports into the economic benefits of three, low-carbon energy technologies: marine energy, electricity networks and storage, and CCS. The Technology Innovation Needs Assessments (TINAs) will be used to prioritise the speed and level of public and private investment into these areas. The reports were compiled by the Low Carbon Innovation Coordination Group (LCICG), a group comprised of experts from different bodies including the Department of Energy and Climate Change (DECC), the Carbon Trust, Energy Technologies Institute (ETI) the Scottish Government and the Engineering and Physical Sciences Research Council (EPSRC), among others.

In the area of CCS, developing the technology could reduce U.K. energy system costs by £10-45 billion to 2050. Key to this happening, however, is ensuring the security of long-term CO2 storage. The report found that while key technological components of carbon capture, transport and injection have been demonstrated at commercial scale, component costs and efficiency penalties remain "high and uncertain". There are also "many challenges" related to full integration. The report found that the CCS industry could be worth £3-16 billion to 2050.

In April this year, the government finally green lit its CCS Commercialisation Programme. It allows €1.2 billion ($1.6 billion) in capital funding for up to four CCS projects to demonstration level. There is also €155.5 million ($197 million) to cover the costs of research and development, including €16 million ($20 million) for a new U.K. CCS research centre. For additional information, see April 11, 2012, article - New U.K. Carbon Capture and Storage Competition Under Way.

The U.K.'s island status means that marine energy could become a major energy source in the future. However, for that to happen, the cost of energy generated will need to reach around £100 per megawatt hour (MWh) by 2025 for marine energy to be competitive with other technologies. The report believes that goal is "ambitious" but possible through innovation. In financial terms, innovation in marine energy could save the energy system approximately £3 -- 8 billion and help create a U.K. industry that could contribute an estimated £1-4 billion to GDP up to 2050.

"Innovation is key to the growth of the low carbon economy here in the UK," Energy and Climate Change Minister Greg Barker said. "This new analysis will help us better understand the value of these technologies to our growing green economy as well as the barriers to commercialisation, helping us put our available investment in the right place to spur on further innovation."

There needs to be more improvements in the area of electricity networks and storage (EN&S), which will be needed to handle the increased use of unpredictable renewable energy sources, renewable heat, electric vehicles (EVs), and other low carbon technologies. Advanced EN&S technologies, according to the report, "have the potential to address new stresses that are likely to be placed on the electricity system, and to do so more cost-effectively than would be possible through traditional methods of grid reinforcement and fossil-fuel-powered system balancing capacity". Financially, innovation in EN&S technologies could save the UK £4-19bn to 2050 and help create an industry that could add an estimated £6-34bn to GDP to 2050.

Last month, the U.K.'s energy regulator, Office of the Gas and Electricity Markets (Ofgem), announced proposals to spend up to €28 billion ($34.4 billion) on upgrading the country's electricity and gas networks. For additional information see July 18, 2012, article -€28 Billion Grid Upgrade Plan for U.K..

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