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Summary:

Carbon capture and sequestration (CCS) is the great hope of the fossil fuel industry. What if, instead of figuring out more efficient wind or solar energy we could just cleanup our existing addiction to coal? The problem is that capturing carbon coming out of coal plants […]

Carbon capture and sequestration (CCS) is the great hope of the fossil fuel industry. What if, instead of figuring out more efficient wind or solar energy we could just cleanup our existing addiction to coal? The problem is that capturing carbon coming out of coal plants is expensive — 1 to 5 cents per kilowatt-hour more expensive — and at this point, experimental, too. Here’s a breakdown of the CCS scene in terms of technology, startups, utilities, and investors all making plays in this sector.

What is carbon capture and sequestration?

There are two separate parts to CCS – the “capturing” process whereby carbon emissions are prevented from being released into the air, and the “sequestration” or “storage” of the captured carbon. “Capturing” carbon means separating out the carbon dioxide from all of the other gases and particulates often found in fossil fuel exhaust. Once you’ve gotten a relatively pure carbon stream you’ve got to find somewhere to store it, “permanently.” This is the type of “permanent” we talk about when we look for places to store toxic waste.

What carbon capture technologies exist?

The biggest difficulty in carbon capture is getting a pure carbon stream. In traditional coal power plants the exhaust is full of other toxic oxides that make it difficult to safely capture and sequester carbon. There are three ways to capture carbon:

  1. Post-Combustion carbon capture attempts to capture CO2 after a fuel has already been burned. This includes the carbon scrubbers systems and could potentially be applied to all existing power plants.
  2. Pre-Combustion carbon capture is part of what is being pushed as “clean coal.” Some proposed new coal power plants are Integrated Gasification Combined Cycle plants (IGCC) which uses pre-combustion carbon capture. The idea of a IGCC plant involves oxidizing the fuel in a gasifier before combustion. This process produces “syngas” which is made of carbon oxides and hydrogen. The resulting carbon emissions can be pulled off in a relatively pure stream while the hydrogen is burned as fuel.

    Most newly proposed coal plants from power utilities all over the country are IGCC proposals hoping to preempt emission restrictions by creating cleaner, purer effluent streams. However, even these are having difficulty getting approval or proving profitable.

  3. Oxyfuel Combustion burns fossil fuels in pure oxygen as opposed to open air. Flue gases are recirculated through the combustion chamber to cool the reaction. The resulting emission stream is almost pure CO2 and water vapor. The water vapor can be separated by condensation leaving just the CO2 to be captured.

CCS Diagram

What carbon sequestration technologies exist?

  • Geologic sequestration is the more popular method. It involves injecting carbon back into the fossil reserves from which is was mined, pumped, and piped. Often carbon gases are injected into oil and gas fields to increase fuel yields, called “enhanced oil recovery” (EOR). Research is being conducted in injecting CO2 into gas and oil reservoirs, coal bed methane recovery, and saline formation sequestration.
  • Terrestrial sequestration looks to capitalize on the fact that the global biosphere absorbs nearly 2 billion tons of CO2 a year. The DoE is focusing efforts in maximizing the carbon uptake of a number of ecosystems including forests, croplands (both agricultural and biomass fuels), deserts, and wetlands. Far more experimental and less concentrated, terrestrial sequestration is unlikely to be an easy way to increase biosphere carbon uptake. Unless, of course, we stop destroying the biosphere.

Startups:

  • GreatPoint Energy – Their main product is natural gas derived from coal called “bluegas.” Using a chemical catalyst to break down low-grade, and low cost, carbon fuels (tar sands, petroleum coke, etc.) in a process called “catalytic coal methanation” GreatPoint produces pipeline grade methane. The resulting emission stream is nearly all CO2 that GreatPoint recommends can be used in EOR operations. GreatPoint has raised $137 million in three rounds of funding and have announced a pilot plant and R&D program. Investors.
  • PowerSpan – Maker of pollutant controls focusing on SOx and NOx, PowerSpan is working on CCS as part of its ECO2 program. ECO2 is an ammonia-based scrubber system that can be added to existing plants ad remove CO2 from flue gases after other pollutants have been scrubbed. PowerSpan has plans for two different pilot programs, one in a partnership with BP Alternative Energy and the other with NRG Energy to prove the commercial scalability. Investors.
  • Blue Source: A carbon middleman, Salt Lake City-based Blue Source orchestrates sales of carbon emissions along their gas pipelines between polluters and EOR projects. MIT Technology Review lauded them as financially innovative for coupling CCS with carbon offset sales.
  • Skyonic: Skyonic’s “SkyMine process” is a post-combustion system that can be implemented in existing plants. The process reacts flue effluent with sodium hydroxide and pulls CO2 out to form sodium bicarbonate (“better-than-food-grade baking soda”) while also removing heavy metals and acid gases. The process uses energy in the form of waste heat from the plant. Oh, and it’s profitable since emitters can sell off the chemicals byproducts. Skyonic has installed a pilot project on a Luminant (formerly TXU) plant in Texas and are planning on installing a system on a large plant (500 MW) in 2009. Skyonics has raised $4.25 million in two rounds of funding, including investment from TXU.
  • Calera: There are few details on this Silicon Valley startup, but the company was founded by Stanford earth sciences professor Brent Constantz and has received funding from Khosla Ventures. Calera looks to make cement, a carbon-intensive undertaking, by taking CO2 out of the atmosphere.
  • GreenFuel Technologies: Looking to sell biomass to biofuel makers, GreenFuel plans to take CO2 from flues and use it to grow algae. The “emissions-to-biofuel” process pulls flue gases through an algal farm to grow the algae and released a performance summary in September. They have raised $18 million in Series B led by Polaris and are raising more funding now.

Investing Players:

Players Implementing the Technology:
Most utilities are looking into this technology, but here’s a working list of some that are leading the pack. (We’ll update this more throughout the day)

How big is the market for carbon capture and sequestration?

The Intergovernmental Panel on Climate Change released a report on CCS which yielded the 1 to 5 cent price increase estimate. The graphic below, from The Oil Drum, converts that estimate into a cost per ton of CO2 captured. The market opportunity for CCS is in getting the cost of carbon capture and storage below carbon credit costs. The World Bank estimates the global carbon market to be worth $70 billion dollars. CCS’s value could exceed this if it allows polluters to reduce their emissions for less than carbon credit prices and then sell their CCS-created credits on the open market.
ccs cost

What is government doing about carbon sequestration?

The DoE announced its first three CCS projects in October 2007 and the fourth in December. The first three projects are being undertaken with separate members of the Carbon Sequestration Regional Partnerships, specifically the Plains, Southeast, and Southwest regions. The projects total $318 million, $197 million of which the DoE will fund. The projects will test the storage of 1 million or more tons of CO2 in deep reservoirs. President Bush kicked of the DoE’s CCS program in 2001 saying “We all believe technology offers great promise to significantly reduce [greenhouse gas] emissions — especially carbon capture, storage and sequestration technologies.”

  1. The Carbon Sequestration Leadership Forum (CSLF) is a voluntary climate initiative whose members, including 21 countries and the European commission, account for about 75 percent of man-made carbon emissions. The CSLF is designed to share and disseminate information and research in CCS. Formed in 2003, the CSLF has recognized 19 CCS projects, only 2 of which have been completed.
  2. There are seven Carbon Sequestration Regional Partnerships splitting up the country into seven regions. This network of state agencies, universities, and private companies is a sort of carbon contingency plan “[i]f it is determined that carbon sequestration must be implemented.” The program has three phases, the third of which, the “deployment phase,” is supposed to start rolling out large volume carbon storage tests this year.
  3. The FutureGen Initiative was announced in 2003 by President Bush as a “10-year demonstration project to create the world’s first coal-based, zero-emissions electricity and hydrogen power plant…” Part of the President’s plant to build a “hydrogen economy,” the FutureGen plant was expected to cost $1.5 billion. The plant’s site was just announced last month, but the DoE released a statement saying they have not yet approved this site and that projected cost overruns require a reassessment.
  4. The Carbon Sequestration Core Program includes all of the ongoing research the DoE is involved in permanent carbon capture and sequestration. There is separate research into carbon capture and carbon sequestration. Different sequestration methods include terrestrial sequestration (vegetative and soil versus geologic sequestration (oil, gas, and coal reserves). The DoE even runs a “Novel & Advanced Concepts” research arm that includes attempting to make carbon “icebergs” to sink into the ocean.
  1. Ugh. I don’t know where to begin. Let’s start with a simple one. How is the injection of bulky, compressed CO2 gas to push up MORE carbon-laden oil a form of sequestering? It is instead actually releasing MORE CO2 into the air, not less (when accounting for the CO2 from the oil when it is burned).

    Oil companies have been using CO2 to enhance oil fields for years. Now they are trying to green-wash the practice by saying they are sequestering CO2. Not true.

    Reforming CO2 to make H2 and then using that makes no sense either. One is better off just burning the methane in a Combined Cycle plant anyway, and let the CO2 be emitted. The main culprit for CO2 emissions is coal, not natural gas, and not even oil. That’s why oil companies can play around in the CCS area; it’s not really their problem anyway.

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  2. Re: Jim

    Great points. You’re right that pumping CO2 into the ground to pull out more oil seems a bit self-defeating, but on the balance sheet it is making all sorts of CO2 sequestration economically viable. Additionally, it is increasing the life of existing oil fields, reducing the need to drill for new ones.

    You’re definitely right that coal is the biggest offender, and most of these companies are designing CCS systems for coal-fire plants. However, saying that emissions aren’t the problem of natural gas or oil seems a bit shortsighted. As the global value of carbon goes up (as more countries, like the U.S., start taxing it or instituting cap-and-trade) the cost of all carbon emitting fuels will follow. With project’s like Google’s “RE Less Than C” threatening to upset the energy hegemony, reducing the cost of carbon emissions will be something all fossil polluters will be forced to address.

    It seems CCS will either have a break through and allow for a clean future for dirty fossil fuels or other clean technologies (wind, solar) will make fossil fuels obsolete.

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  3. Re: Jim

    Im missing the step in you logic where injecting compressed CO2 doesn’t reduce the amount of carbon dioxide in the atmosphere. With energy prices rising these energy companies are going to get their hands on the coal and oil regardless of whether they have to inject compressed CO2 or compressed air into their wells. Using this form of CCS in conjunction with any of the other proposed forms will lead to a net reduction in carbon emissions. Even when the emissions from the hydrocarbons are taken into account and supposing that no form of CCS is used on the resulting emissions there is still just THAT much less carbon dioxide in the air.
    As far as the other proposed forms of CCS they are all at least doing something about the carbon, I find it hard to believe that simply releasing it is ever a better alternative, especially when it can be fiscally justified.

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  4. [...] including what it is and who all the startups are that we need to be keeping an eye on. Read more here. Share/Send Sphere Print Previous [...]

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  5. For geologic sequestration, how can one be sure that the carbon dioxide will STAY underground? Would it not leak out over time?

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  6. Craig,

    Some Swedish researchers did a study and found that the amount of CO2 caused by burning all remaining natural gas and oil would raise the CO2 ppm by a fairly small level, less than 20-30 ppm. Our CO2 levels are all about burning coal and to some extent deforestation. We don’t have enough natural gas and oil left to make that much of a difference in that area.

    Devon,

    The oil companies have been doing this (injecting CO2) anyway. It’s the best gas to use for this purpose (probably not a good idea to inject an oxidizer (O2) into a field of fuel….) because it is non-reactive to oil and NG. They are simply green-washing an enhanced recovery step that they use for their wells.

    If you want to store carbon, there is an easy way to do it. Leave unburned coal in the ground.

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  7. [...] news and notes:  Here’s a pretty good overview on carbon capture and sequestration (CCS)…  Measurement and verification — critically important in the carbon offset [...]

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  8. [...] a few short years. But the banks could still be willing to finance coal projects that would use carbon capture and sequestration technology whenever it becomes [...]

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  9. [...] Written by Craig Rubens No Comments Posted February 25th, 2008 at 11:59 am in Energy Recent research into capturing and storing carbon, that elusive silver bullet that could cure our coal-powered woes, is inching closer to [...]

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  10. [...] that renders fourth-generation biofuels a carbon negative source of fuel. However, the weak link is carbon capture and sequestration technology, which continues to elude the coal [...]

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