The UKCCSRC 2021 conference 'Delivering on COP26: CCS across the World' presented a highly upbeat vision of CCUS progress across the world, but especially in the UK. For the UK, several prominent contributors, notably Jon Gibbons, Professor Paul Monks BEIS (Department for Business Energy and Industrial Strategy) Chief Scientific Advisor and Dr Bryony Livesey, UKRI, outlined significant initiatives to instigate major CCUS deployment as part of a strategy to meet a national Net Zero Emissions target by 2050.
Despite many previous UK Government led initiatives to develop CCUS none have progressed to a large industrial demonstration scale.In a reversal of fortune the UK's Prime Minister announced, on 18th November 2020, an ambitious 10 point plan for a green industrial revolution (The Ten Point Plan for a Green Industrial Revolution).It aims to achieve 5 GW of low carbon hydrogen by 2030 for industry, transport, power and domestic heating with the first town heated entirely by hydrogen by 2030.
The political spur for this goal is a legislative commitment, passed on 27th June 2019, to commit to net zero emissions by 2050.The Climate Change Act sets legally binding interim targets for five-year Carbon Budget periods.Short-term policy decisions aim to meet 4th and 5th carbon budgets (CB4 2023-27 & CB5, 2028-32) with a 6th (CB6) set during June 2021.Although the UK's 2030 Nationally Determined Contribution (NDC) will set the tone for COP26, UK emissions are currently projected to significantly exceed legal emissions caps (CB4 & CB5), consequently a paradigm shift in emissions reduction is required. More background on CB6 and financing CCUS is explained in a blog published on 3rd February 2021 and 2021- IP01 UK CCC Sixth Carbon Budget Report.
With this new sense of urgency the UK's Climate Change Committee 2021 Progress report to UK Parliament has recommended that the pathway to net zero by 2050 should reduce emissions by 78% by 2035.It proposes a major scale-up of low carbon markets and supply chains over the next decade including a switch to all electric cars and complete gas-fired boiler replacement by the early 2030s.A national programme to improve insulation and a reduction in high-carbon meat consumption by 20% by 2030 are also recommended.
The UK Government has ambitious plans ahead of COP26 across several key sectors. These include an Energy White Paper, a Transport Decarbonisation Plan, an Industry Decarbonisation Strategy, a Hydrogen Strategy and a Heat and Building Strategy. To achieve net zero by 2050 this will mean:
- Electric Vehicles : 42M up from ~200k today
- HGVs (heavy goods vehicles) 1.6M ultra low emission up from <1k today
- CCUS 10 MT/yr by 2030.5GW low carbon hydrogen production capacity by 2030 (~42 TWh).
- Electricity generation doubled from present day to 550 – 750 TWh/yr.A four-fold increase in low carbon generation to 95% from 53% today. Acknowledgement that doubling electricity demand, especially with an increased renewables contribution, will need to include a small amount of low carbon power that can deal with intermittency. By 2050 this could be hydrogen linked to storage.
- Low carbon heating increased to ~25M from ~200k today.
- Bioenergy with CCS increased five-fold to 74 MT/yr.
- DACC installed to 13 MT/yr.
By 2050 the aggregated annual CCS required would be 75 – 175 MtCO2. The transition to hydrogen would demand a 10-fold increase to 300 TWh for industry, long distance HGVs, Ships and buildings.A BEIS analysis for CB6 suggests 250 – 460 TWh of hydrogen could be needed by 2050 equivalent to 20-35% of UK total energy consumption. A twin track approach is envisaged that would allow for the production of both electrolytic 'green' and CCUS-enabled 'blue' hydrogen.
For the immediate future six coastal regions around the UK have been identified for cluster development including Hynet on Merseyside; Net Zero Teesside and Zero Carbon Humber. Other sites are located at Acorn St Fergus in NE Scotland, South Wales and Southampton. HyNet will include both on and offshore hydrogen and CCS. Teesside and Humber will share the Northern Endurance Partnership an integrated offshore carbon storage development.£200m of new funding has been allocated to create two carbon clusters by the mid-2020s with another two to be created by the 2030s as part of a levelling-up agenda. By 2030 CCUS should be established in four industrial clusters with an ambition to capture 10Mt/CO2 per annum.
Under pinning this bold drive to decarbonise major industrial hubs is an Industrial Decarbonisation Challenge (IDC) initiative broadly divided been support for deployment, cluster plans and a new Industrial Decarbonisation Research and Innovation Centre. The latter is a multidisciplinary research centre for cross-cutting technology development, policy and economics and delivery of a programme of knowledge exchange activities. FEED studies, permits, technology and process demonstration will be covered by deployment. Cluster plans will include infrastructure, policy development, business plans, regulatory and finance models.
By September 2021 all cluster projects were underway, plus three offshore storage projects and six cluster decarbonisation projects. Completion is expected between spring 2023 – spring 2024.
Two other recent initiatives related to funding mechanisms for CCUS are also worth noting. BEIS have been developing a series of business models. These include:
- CO2 Transport & Storage Regulatory Investment Model.
- Economic Regulatory Regime.
- Dispatchable Power Agreement that provides generators with payments comprising of an availability and variable payment for flexible, low carbon power at a market price.
- Industrial Carbon Capture (ICC) is a Contract-for-Difference (CfD) model where subsidy reduces as carbon prices rise and low-carbon product markets emerge.
- Hydrogen Business Model – a producer-led incentive model similar to CfD.
- Bio-CCS business model
The CCSA commissioned an economic analysis from Afry and Cambridge Econometrics to assess the implementation of a funding support mechanism for CCUS.The study outlines the funding required to deploy CCUS in 2020s to meet 2030 CO2 capture target scenarios. Significantly a gap analysis on lessons learned from the UK Government support for offshore wind deployment is included .CCSA propose the introduction of a Levy Control Framework funding mechanism for CCUS.
It's quite clear from this conference that the UK is stepping up its support for CCUS and has an emphatic and legally binding goal to meet net zero emissions by 2050. Moreover it's also clear CCS is a necessity not an option to reach net zero.