Report: Clean coal more costly

Oct. 28, 2009 at 5:11 PM
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CANBERRA, Australia, Oct. 28 (UPI) -- Clean coal would add 78 percent to the price of electricity, according to a report released Wednesday from the Global Carbon Capture and Storage Institute.

The institute, established by the Australian government, includes the United States, the United Kingdom and Japan among its members.

Without policies and legislation to assign a value to carbon dioxide, the report says, the energy sector has a "limited incentive" to install carbon capture and storage facilities. What could make CCS work, it said, is the "field of dreams" or the "build it and they will come" option: governments "working in partnership with industry and the community to develop, finance and build common user transport and storage infrastructure."

"A viable business case for commercial-scale, integrated projects has not been established at this time for coal-fired power generation and other large CO2-emitting industries," the report states.

Government-subsidized CCS demonstration projects could "substantially" lower the costs of future CCS power stations, said the institute's chief executive, Nick Otter.

There are 213 active or planned carbon capture projects worldwide for coal, gas and oil, the report found. But only seven projects are running now, all on gas processing plants.

Professor Richard Hillis, head of the University of Adelaide's Australian School of Petroleum, said it is predictable that carbon capture and storage would take some time to develop and that it would be expensive at first.

''If you think of the oil industry when it first began, it didn't develop in a matter of weeks, it took decades, and carbon capture will go through the same process,'' Professor Hillis said, The Age reports.

Australia intends to spend $2.4 billion during the next nine years developing two to four commercial-scale carbon capture projects.

In a recent speech, Resources Minister Martin Ferguson said it was "becoming increasingly clear that no serious response to climate change can ignore the need to accept fossil fuels as part of our shared future," The Australian reports.

"As the world's largest exporter of coal and a nation which derives around 80 percent of its electricity from coal, it is vital that we make technological progress on carbon capture and storage -- and soon," said Ferguson.

In 2008 coal-fired electricity accounted for 36 percent of Australia's total emissions. Australia has surpassed the United States as the world's biggest per capita producer of carbon emissions, according to a report last month by British-based Maplecroft, a risk consultancy firm.

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