CCS: Role in Global Emission Reductions, a presentation delivered by Bo Diczfalusy, Director of Sustainable Energy Policy and Technology at the International Energy Agency (IEA), on a Tuesday Dec 6 COP 17 Institute side event. The presentation reviews the IEA’s work in CCS. It also talks about global energy demand, which is expected to double in the next 40 years. Since 2005, non OECD countries are emitting more than OECD countries. More than 30 per cent of global incremental demand is from China alone.

1. Carbon Capture and Storage:
Role in Global Emission Reductions
Global CCS Institute event
Durban, 6 December 2011
Bo DICZFALUSY
Director, Sustainable Energy Policy and Technology
International Energy Agency
© OECD/IEA 2010

2. International Energy Agency
IEA countries
OECD countries, but not IEA members
 Inter-governmental body founded in 1973, currently 28 Member Countries
 Policy advice and energy security coordination
 Whole energy policy spectrum and all energy technologies
 Flagship publications include WEO and ETP
 Host to more than 40 technology-specific networks (“Implementing
Agreements” or “IAs”)
 Operated independently with their own membership and financing
 Includes GHG IA
 Active in CCS since 2000; dedicated CCS unit created in 2010
 Provides policy advice
 Supports broader IEA cross-technology analysis
© OECD/IEA 2010

3. Contents
1. Trends and targets in energy and emissions
2. The role of CCS
3. Recent and current IEA activity
© OECD/IEA 2010

4. Global Demand x2 in 40 Years
 From 6 000 Mtoe
to 12 000 Mtoe
 75% of the
increase is from
fossil fuels
 Moderate
increase in OECD
world
 Rapid demand
growth outside
OECD
Source: IEA statistics
© OECD/IEA 2010

5. Global CO2 Emissions Doubled
 Global energy-related CO2 emissions have more than doubled
in past 40 years, from 14 Gt to 30 Gt
 Until very recently, majority of emissions in OECD countries
 Since 2005, non-OECD countries emit more than OECD
 Current CO2 concentration in atmosphere roughly 390 ppm
© OECD/IEA 2010

6. Energy Demand Continues to Grow
 Energy demand +40% by 2035 (12 000  17 000 Mtoe)
 China: >30% of global incremental demand
 OECD demand stagnates
Source: “New Policies Scenario”, IEA World Energy Outlook 2011
© OECD/IEA 2010

7. CO2 Emissions Continue to Grow
 Energy-related CO2 emissions 36 Gt by 2035
 Gas-related CO2 emissions grow fastest (1,5% pa), followed
by coal (0,5% pa)
 650 ppm CO2-eq pathway
Source: “New Policies Scenario”, IEA World Energy Outlook 2011
© OECD/IEA 2010

8. 2035: CO2 Emissions Shift to Asia
© OECD/IEA 2010 Source: “New Policies Scenario”, IEA World Energy Outlook 2011

9. Towards a Sustainable Future
 Current policies or “reference scenarios” unsustainable
 Scientific evidence and policy ambitions now often target
“450 ppm scenarios” (50-50 chance to keep temperature
increase at ≤2C)
 Critical period NOW to establish policy and develop technology
Source: “New Policies Scenario”, IEA World Energy Outlook 2011
© OECD/IEA 2010

10. Carbon Capture and Storage:
Limited Role with Known Policies...
 Only 65 GW of CCS-equipped coal-fired power capacity by 2035
 Share of CCS in coal-fired power remains at 3% in 2035 (and only
1% of total power generation)
 No gas-CCS
 No or very limited industry-CCS
© OECD/IEA 2010 Source: “New Policies Scenario”, IEA World Energy Outlook 2011

11. … But Critical in “450” Scenarios
© OECD/IEA 2010

12. Can the Potential of CCS be Exploited?
 3 000+ projects across the globe
 3 000+ across industries: CCS not only about coal-fired power
 150 Gt CO2 captured and stored
© OECD/IEA 2010

13. CO2 is Captured and Stored as We Speak…
Weyburn >2,3Mt
Sleipner 1Mt Snohvit 0,7Mt
In Salah 1,2Mt Rangely 1Mt
 Five to eight (5-8) integrated large-scale projects are currently
storing >5Mt CO2 per year
 Another six (6) projects under construction
 Several smaller-scale pilot installations across the globe
 Applied R&D by government, industry and research community
 Academic research into capture, transport and storage
technologies and related sciences
© OECD/IEA 2010

14. … and More is Planned
60 other integrated large-scale projects in various stages of development
Source:
© OECD/IEA 2010

15. CCS Cuts Across Various Sectors
Industrial
Power sector
applications
CCS
Transport:
Hydrocarbon
biofuel
extraction: EOR
production
© OECD/IEA 2010

16. Challenges Remain for CCS
 Firm decisions to address climate change
 Understanding of CCS and recognition of its role
 CCS in industry and biomass
Setting
strategic policy  Existing public
 CAPEX, OPEX drivers support 25-35 bn
USD globally
 Market
dynamics, incl.  Need to
impact of Reducing Providing
costs of incentive mobilise
cheap gas technology mechanisms 5 trillion USD
 Industrial 2010-2050
deployment  OECD – non-OECD
bottlenecks
 Incentive policy
 Infrastructure pathways
planning and
coordination Understanding Laws &
storage regulations
 Knowledge on storage capacity
 OECD vs. non-OECD countries
 Time required for storage site development
 International legal issues e.g.,
 Long-term liability London Protocol and OSPAR
 Public acceptance
© OECD/IEA 2010

17. A long-term signal to investors?
The case for clean-tech support:
• Most low-CO2 technologies are not cost-competitive
• But should account for vast majority of supply by
2011 2050 (renewables, CCS, nuclear) to cut CO2
• Today’s CO2 price – where it applies – is too low
• Necessary step: targeted support for cost reductions
Bridge in key technologies
• Rising CO2 cost + lower unit cost of low-CO2
technology ensure full competitiveness
2030
© OECD/IEA 2010

18. Summing Up
 Global energy demand and emissions continue to grow
 Role of CCS is critical
 This potential WON’T be realised without designated
policies
 This potential MAY be realised, if ambitious policies
and incentives exist … and other challenges are
overcome
 Delaying CCS is a very costly option
© OECD/IEA 2010

19. Thank you!
bo.diczfalusy@iea.org
© OECD/IEA 2010