Progress on carbon capture and storage requires a global effort

Carbon Capture Use and Storage (CCUS) more than halves the cost of decarbonization according to the IPCC. This alone speaks to the relevance of CCUS in the fight against climate change, but for decades deployment has been slow.

Strengthened climate targets and new policy incentives have recently renewed global interest and the pipeline of integrated CCUS projects is growing – the IEA [1] says over 30 new announcements were made in the last 3 years.

At bp, we believe CCUS has a critical role to play to decarbonize the world:

It is cost-effective 

The IPCC 5th Assessment Report reported that 2oC scenarios which do not use CCUS would, on average, cost more than twice as much as those that do: 138% increase. Energy consultancy Poyri [2] also concluded that using CCUS could save €1.15tn versus an all-electric pathway to reach a net zero energy sector in Europe.

Why is CCUS part of the least cost pathway to decarbonize the economy? The technology can be retrofitted to existing assets like gas fired power plants, which allows them to operate for longer, but with reduced carbon emissions. For hard to abate sectors like heavy industries, the cost of alternatives to fossil fuel – like using electricity to generate extreme heat – is often prohibitive and makes CCUS a viable solution to decarbonize.

It enables decarbonized gas and blue hydrogen

Second, natural gas is expected to remain part of the energy system for decades to come. It will become a flexible source of power generation that complements the intermittency of renewables. And it remains essential for industrial sectors like steel, cement, or chemicals. When combined with CCUS, natural gas can be a source of near-zero carbon energy.

Natural gas with CCUS also enables the production of low carbon blue hydrogen that will contribute to reduce carbon emissions in heavy industries, refineries, and will play a role in decarbonizing other hard to abate sectors like heavy duty and long haul road transportation. Blue hydrogen is a steppingstone to scale up the hydrogen economy and pave the way for green hydrogen, generated from renewable electricity and the electrolysis of water.

The production of blue hydrogen is expected to require between just under 1Gt and 2Gt of CO2 storage via CCUS by 2050 (bp’s 2020 energy outlook rapid and net zero scenarios) – this represents between 25% and 35% of the total demand for CCUS. In most countries, we believe blue hydrogen will remain cost competitive against green hydrogen until the mid-2030’s.

We know it works

Finally, CCUS is a proven technology. Today there are 26 commercial CCUS facilities in operation that, according to bp’s 2020 Statistical Review, can capture and store the equivalent of the annual greenhouse gas emissions of Switzerland.

At bp, we have been involved in CCUS for a while. For example, our In Salah joint venture in Algeria stored over 3Mt of CO2. And the Net Zero Teesside project (NZT) has the potential to be the UK’s first commercial CCUS infrastructure, intending to capture up to 10Mt of CO2 emissions: like the yearly energy use of over 3 millions UK homes.

bp’s 2020 Energy Outlook estimates that CCUS will help capture a little over 5Gt CO2 by 2050 (up from 40Mt CO2 in 2020) which is roughly equivalent to 15% of all current carbon emissions from energy use.

Policy matters

To deploy CCUS at the scale required to help achieve the Paris goals at lowest societal cost, we need supporting policies that, for example, incentivize and permit the use of existing pipeline infrastructure, or the construction of new CO2 transport infrastructure (such as pipelines, trucks, rail, ships); or clarify the risk-sharing mechanisms and regulations with respect to long-term stewardship of stored CO2.

We are working with partners in industry, government, and NGOs such as with the Carbon Capture and Utilizations Association (CCSA) and the UK government’s CCUS Council, because we expect it to be an important and cost-efficient lever to help deliver on our net zero ambition and help the world get to net zero.

And while CCUS is vital for the world to achieve net zero, it is also an important element of the bp strategy. Whilst there is much more to do, at bp we are actively working on CCUS, including two developments in the UK.

First, two projects we are participating in on the north east coast of England – NZT, = a planned gas fired power plant with CCUS technology, and the Northern Endurance Partnership (NEP), the offshore CO2 storage infrastructure that NZT will use, have been awarded funding from the UK government in the last year. This is a crucial step towards developing the UK’s first net zero industrial cluster by 2030.

We also announced a feasibility study to develop H2Teesside, a 1 GW blue hydrogen project, leveraging the NEP infrastructure to develop low carbon hydrogen and help further decarbonize industries in the area. H2Teesside has the potential to generate 20% of the UK’s target for low carbon hydrogen production by 2030. It could be a game changer.

You can find more about how CCUS works on bp.com

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[1] CCUS in Clean Energy Transitions – Analysis - IEA

[2] poyrypointofview_fullydecarbonisingeuropesenergysystemby2050.pdf