The regulation of carbon capture and geological storage
Carbon capture and storage (or sequestration) (CCS) could be an important climate change mitigation technology, integrating fossil fuels into a carbon-managed energy system and helping meet the growing demand for energy until fully renewable energy systems come online. The technology is conceptually simple: carbon dioxide (CO2) is captured from electric power plants or industrial sources, transported to the injection site, and injected deep underground for storage.
It is estimated that CCS could be used to achieve between 15% and 55% of the CO2 emission reductions necessary to avoid dangerous levels of climate change [IPCC, 2005]. This would require large-scale, worldwide deployment of CCS, which, in turn, will require the creation of a regime to manage risks and supporting policies to facilitate technology investment. Within this framework, regulatory, legal, and public perception considerations emerge as crucial factors that could either accelerate or stymie CCS deployment.
The technology is still some years from commercial implementation. There are very few test sites in operation and, therefore, almost no risk assessment data available. There are, additionally, many unresolved questions which relate to how the technology will be regulated, how the necessary investment will be financed and what liability regime(s) will be most appropriate.
In 2006 IRGC decided to address the risk governance of CCS in a project led by Granger Morgan (Head of the Engineering and Public Policy Department, Carnegie Mellon University, and Chairman of IRGC’s Scientific and Technical Council) and Elizabeth Wilson (Humphrey Institute of Public Affairs, University of Minnesota).
The project’s primary objective was to explore the key elements of what could become an agreed international regulatory framework to support the development and, later, commercial scale-up of CCS. This objective was based upon the premise that the benefits of introducing CCS on a commercial scale would only be realised with knowledge of the regulatory regime that will prevail and some certainty that the development and operation of the storage sites could realise economic rents.
IRGC is extremely grateful to E.ON Energie AG and the Allianz Technology Center for financial support to this project. Also, for their valuable in-kind contributions we also thank: Resources for the Future, the Climate Decision Making Center at Carnegie Mellon University and the Swiss Re Centre for Global Dialogue. Finally, we thank all the expert authors and those who spoke at the November conference for their invaluable contributions to this project.
The total budget for this project was 137,000 CHF.
For more information, please contact Ms Malin Samuelsson.