Coal fans have been pinning their hopes for survival on technology that captures and stores carbon emissions, or CCS for short. The problem is that coal is running into stiff competition from low cost natural gas and renewable energy, too. In other words, cutting carbon emissions is just half the battle. The other half is offering rates that can compete in today's diversified electricity market.
CCS may fail to save coal power plants, but the technology still has potential in the low carbon economy of the future. In a twist of irony, a new study from Stanford University demonstrates that CCS could help give the biofuel industry a big edge on its fossil fuel competition.
If that sounds like a lot of expense for little return, it is. That's what doomed FutureGen, the US Energy Department's signature CCS project. The $1 billion project was canceled in 2015 after it became clear that the financials couldn't work out.
The basic problem is that CCS systems are expensive. Simply storing excess carbon doesn't help offset that expense unless tax credits are other subsidies are involved, and that leaves companies exposed to public policy risks.
That's an important step as far as resource conservation goes, but it doesn't quite resolve the central issue for coal.
Coal is already sequestered in the ground, where it is generally not causing any trouble. The trouble begins when it is unearthed.
Biofuel potentially offers a more sustainable solution because plants already do a lot of the heavy lifting, by removing carbon from the atmosphere.
That negative-carbon capability could provide the biofuel industry with a bottom line incentive to invest in CCS technology, and that's where the new Stanford study comes in.
Published Monday in the Proceedings of the National Academy of Sciences, the study zeroes in on one type of CCS system that seems to have good potential for application to US ethanol refineries.
The CO2 emitted from ethanol refineries is relatively pure, which makes it more simple and inexpensive to compress for injection underground than emissions from other sources.
As the authors note, large scale CCS is already practiced at a small number of US ethanol refineries. The aim is to show the feasibility of adopting these practices at a broader scale, using the existing technology.
First, a quick look at the numbers:
The researchers estimate that 60 percent of all CO2 emitted annually through the production of ethanol at the country’s 216 biofuel plants (about 1 percent of all CO2 emissions from the U.S.) could be captured at low cost, under $25 per metric ton of CO2.
According to the study, about 4,300 miles of pipeline infrastructure would be needed to ship all that captured CO2 to storage sites. The next problem is how to pay for all that.
The solution lies in applying tax credits or similar public subisides. The researchers estimate that a credit of $60 per metric ton would provide enough bottom line motivation to sequester 30 million tons of carbon and invest in the necessary pipeline infrastructure. A credit of $90 per metric ton could spur 38 million tons of sequestration.
As for the risk inherent in policy-based solutions, the number crunching took into consideration the 12-year lifespan of tax credits for carbon capture contained in the new federal budget.
Refineries with CCS-equipped facilities could also receive an additional benefit for ethanol sales to the California market:
...on April 27, California will consider updating its rules to include new protocols that would quantify the value of carbon removal in the fuel production process. If adopted, fuel producers could collect more credits by selling lower-carbon ethanol in California.
Carbon recycling provides a long term solution that could add even more value to existing CCS technology, but those systems are farther away from scale than the solution described by the Stanford study.
It's also important to keep in mind that even if the financial motivation and technology are currently available, the "near-term" deployment described in the Stanford study could be more than a few years away.
One main hurdle is the navigation of state processes for permitting the construction of new pipelines.
Local communities have been flexing their muscles when developers come through with plans for new pipelines, and the carbon-saving angle of a new CCS pipeline isn't likely to pacify opponents.
New clean tech infrastructure -- wind energy transmission lines, wind farms and solar farms, too -- can also face objections from local property owners and other stakeholders, including the fossil fuel industry.
Nevertheless, the report provides a strong case for continued support for the US biofuel industry, and a timely one, too: in a historic move, Japan recently announced that it is permitting its first corn ethanol imports from US refineries.
Photo (screenshot): US Department of Energy.
Tina writes frequently for TriplePundit and other websites, with a focus on military, government and corporate sustainability, clean tech research and emerging energy technologies. She is a former Deputy Director of Public Affairs of the New York City Department of Environmental Protection, and author of books and articles on recycling and other conservation themes.
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