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by Climate Change Economics LLC

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Our glaciers are shrinking

Just because we can do a thing it does not necessarily follow that we must do that thing.


Editorial by Barry Piacenza

Climate Change Economics LLC - October 15, 2010

This Editorial pertains to the report of the Interagency Task Force on Carbon Capture and Storage August, 2010. Report was co-chaired by the US Department of Energy and the Environment Protection Agency and sent to the President of the United States.

What is carbon capture and storage?

This is a process by which carbon dioxide CO2 is captured from power plants and or industrial sources and captured CO2 is transported in pipelines or via truck or other methods to be stored in geologic formations such as deep mines, old salt formations, under the oceans, oil and gas reservoirs or in coal seams and other geological formations found suitable for storing CO2 for very long periods of time perhaps millions of years.

This is not a new technology it has been used for 40 years on a small scale with about 3600 miles of existing pipelines.

The storage of carbon dioxide in the oceans and rock formations either on land or under the oceans leaves the CO2 question to be solved by future generations of humans. We have seen similar programs regarding nuclear waste with substantive unfortunate histories.

Carbon capture and storage is an expensive technology not only to design, develop and implement it's also expensive because its outcomes raises costs for electricity 40-80% (depending on which technology is utilized) and creates legacy problems that can last millions of years and those carry associated future costs as well as institutional, financial controls and regulatory schemas that frankly do not work. There are additional problems pertaining to aggregation, pore space, property rights and the fact that the public is again being asked to support a very large millennium scale project the outcomes of which are largely unknown.

The regulatory changes alone (in the United States) are substantive these include but are not limited to the Safe Drinking Water Act, the Clean Air Act, Resource Conservation and Recovery Act, CERLA, the London Protocols, Marine Protection Research and Sanctuaries Act, the Outer Continental Shelf Lands Act, the National Environmental Policy Act, and a host of other regulatory issues both nationally and internationally. Additionally there are questions regarding long-term liability and stewardship issues. On the economic side their are perturbations relative to utility rates and costs that will severely impact economically, socially, medically disadvantaged populations on a global scale. These factors alone will add additional pathologies to the use of carbon capture and storage and its outcomes.

Legislative pipeline costing so far exceeds $60 billion in direct spending and $30 billion in tax credits to the American Recovery and Reinvestment Act of 2009 the ARRA authorizes $2.4 billion to support CCS RD &D and the initiatives that range from analysis of the sequestration potential of geologic formations to public-private cost share demonstrations advanced CCS technologies1.

One of the baseline assumptions for this report is that global carbon dioxide levels are targeted at 550 ppm as opposed to 350 ppm as advocated by some the world's leading climatologists including Dr. James Hansen PhD. A 550 ppm world is a very dangerous place. If concentrations rose to 550 parts per million, for example, the world would see an initial warming of 1.6 °C — but even if concentrations stabilized at this level, further warming would leave the total temperature rise closer to 3 °C, and would persist for millennia2. In addition to these findings the National Academy of Sciences in a prerelease report shows that ” For example, if concentrations reached 550 ppmv, transient warming would be about 1.6°C, but holding concentrations at 550 ppmv would mean that warming would continue over the next several centuries, reaching a best estimate of an equilibrium warming of about 3°C.”3 A 3°C rise is equivalent to 5.4°F rise in temperature which has substantial impacts.

The United States, Australia, Japan, China and European countries are publishing data on the geological storage potentials these atlases will contain comprehensive information regarding the location of stationary CO2 emissions sources locations and sequestration potential of various geologic sequestration sites and provide information about the commercialization opportunities for CCS technologies. In United States this work is being done by the US Geological Service (USGS) 4.

Carbon capture and storage technology regardless of the type of technology utilized will increase the cost of electricity for anywhere from 40% to 80% whether a pre-combustion CO2 capture, or post-combustion CO2 capture or proxy combustion CO2 capture. Each of these approaches results in increased capital and operating costs and decreased electricity output (or energy penalty), thereby significantly increasing the cost of electricity (COE) (Rubin, 2008; DOE, 2010a). The energy can penalty occurs because the CO2 capture process uses some of the energy produced in the plant. Energy penalties are in a range of 20% to 30%, which means that you are going to burn 20 to 30% more coal and increase costs to the consumer of the electric power from 40 to 80%! The only winner in this formula is the energy producing company and the coal producer. The consumer loses because they're paying 40 to 80% more for their electric power plants, society loses because there are the unknown legacy costs of having to care for the stored carbon dioxide whether it be in land-based storage or ocean-based storage. The long-term costs of storing the material in the legacy issues are not completely known.

We are providing information from (appendix A., table 8 -- A) of various projects 6

It is estimated by Department of Energy that for a new 550 MWe net output power plant, addition of currently available pre-combustion CO2 capture and compression technology increases the capital cost of an IGCC power plant by approximately $400 million (~25%) compared with the non-capture counterpart. For a similar sized new supercritical PC plant, post-combustion and Oxy combustion capture would increase capital costs by approximately $900 million (80%) and $700 million (65%) respectively. For post-combustion CO2 capture on a similarly sized new NG CC plant, the capital costs would increase by $340 million or 80%7. For illustration purposes we provide the following below of these cost factors8.

In conjunction with carbon capture one must also transport the captured carbon dioxide. In conjunction with this aspect of policy development CO2 transportation via pipelines in the United States has been in existence for approximately 35 years and are standardized_49 CFR 194 and administered by the US Department of Transportation Pipeline and Hazardous Materials Safety Administration and other various state agencies. However if CO2 is to become commercially deployed these pipelines are expected to become the principal form of transport to bringing CO2 from point sources to geologic storage sinks such as saline formations, coal seams, and oil and gas fields (Dooley et al., 2008). The estimated length of pipelines the for commercial deployment of CCS given studies ranges from 5000 to 13,000 miles in 2020 and from 22,002 36,000 miles through 20309.

In conjunction with capture and transportation of CO2 one must now turn to the storage aspect of these projects. These are long-term sequestration's sometimes to last millennium. This part of the discussion is very similar to that sometimes discussed in the Nuclear Regulatory Commission capability of long-term storage of radioactive waste materials either at high or low levels.

The history of CO2 storage into subsurface formations goes back to the 1970s pertaining to enhanced oil recovery however these projects are much smaller than we would be seeing under these new schemas. There are a number of formation capabilities including oil and gas fields, on mineable coal seams, and saline formations, with retention for over 1000 years. This long-term storage capabilities bring about a whole host of long-term legacy issues there are multiple vulnerable considerations regarding geologic sequestration of CO2 these include but are not limited to the endangerment of drinking water supplies. CO2 forms a weak acid, carbonic acid that could cause leaching and mobilization of certain natural occurring metals naturally-occurring metals or other contaminants from geologic formations into ground water e.g., arsenic, lead, and organic compounds). Additionally, pressures induced by injection may force native brines (naturally occurring salty water) into USDWs, causing degradation of water quality and affecting drinking water treatment processes, as well as fluid movement based on some form of thermal shock in the vicinity of these wells10.

Although CO2 by itself may not be toxic there are acute health effects to humans and animals and vegetation depending on concentrations and duration of exposure some of the adverse health effects can cause both chronic (e.g., increased breathing rate, vision and hearing impairment) and acute health effects to humans, animals, and vegetation, depending on the concentration and duration of exposure11. In conjunction with long-term storage there are multitudes of regulatory and other issues that need to be taken into consideration including but not limited to:
  • Financial Assurances,
  • Institutional and Proprietary controls,
  • Institutional Controls,
  • Physical Controls,
  • Storage Cell, rupture and design issues, leakage,
  • Ground Water Monitoring,
  • Migration,
  • Ocean acidification,
  • Maintenance of Physical Controls & Monitoring,
  • Regulatory monitoring,
  • Deemed safe issues,
  • Failure issues,
  • Criminal activity,
  • Management and mismanagement,
  • Financial embezzlement, misfeasance and malfeasance,
  • Creation of a long-term advocacy group for this technology to lobby Congress for more money and protect and defend itself.
Figure III-2 Vulnerability Evaluation Framework for Geologic Sequestration of CO212.

The long-term security issues for the sites are substantial most will be retained for a thousand years according to the IP CC, 2005. There are also issues for the behavior of the natural systems into response of the introduced CO2 as well as, terrorist issues, security concerns over the long-term and the best ensuring storage integrity at each site. Currently monitoring is only for 14 continuous years and other related areas such as EOR nearly 40 years of storage history so far to date. We are talking about the ability to secure these sites for over 1000 years or more and assume all of the affiliated costs and liabilities affiliated to the sites on a global basis some of which are going to be in remote areas the globe if they are released would create substantial ecological damage to the planet not to mention catastrophic damage to the locale of the event which could include human casualties as well as wildlife and other casualties within the immediate area. If supercritical CO2 is injected into shallow formations where pressures are not high enough to maintain its supercritical state and the CO2 reverts to a gas, it could cause expansion of gaseous CO2, a drop in temperature (the Joule-Thomson effect), and then freezing and thermal shock in the vicinity of the well. This thermal shock could compromise the integrity of the injection well, increased potential for fluid movement and contamination of USDWS13. The effect of the Joule Thomson effect is very dangerous and uncontrollable once started there's no way to stop it. In addition there are concerns regarding impurities in the CO2 stream which include sulfur dioxide which can oxidize to a sulfate and change the chemistry of the reservoir fluids (e.g., affecting the acidity or the oxidation potential) and dissolution or precipitation of minerals, which could, in turn, affect reservoir performance (e.g., injectivity and/or storage integrity). There are unknown rates of reactions between injected, formation fluids and rock formations there is also the potential for heavy metal concentrations captured in CO2 stream all of which complicate the long-term issues affiliated with storage and corrosion14. The long-term stewardship issues have unknown costs and risks affiliated with them for which there are no conclusive outcomes on long-term testing capability the Department of Energy National Risk Assessment Partnership is currently building the scientific basis for quantifying risk profiles15.

On the cost of storage side current estimates of commercial scale projects are $11-$17 per ton, $20 per ton and $6 per ton 16. this does not include the year their estimates for building the structures which was to capture the CO2, overall costs for this type of venture are in the tens of billions of dollars and in the long-term could approach trillions. The current barriers include market failures, legal and regulatory frameworks, long-term liability for CO2 sequestration, and integration of public information, education and outreach not to mention the possible disaster capabilities that might be involved on one of the sites if they are breached and the ecological damage to the planet. It is important to recognize that unless there is a price on carbon none of the schemas will work. Unless you can establish a clear price on carbon and price signals on greenhouse gas emissions that rise over time we'll incentivize business to look for ever cheaper ways to reduce emissions. It will also put an established low carbon technologies on a level playing field with conventional carbon emitting technologies, yield near-term opportunities for emerging technologies, and create greater market certainty for long-term investments in new or improved low carbon energy development17. In essence were now establishing the capacity for an ever rising price of carbon none of the schemas will work unless those markets work effectively. It will put continuing pressure on the development of new technology that will undermine the success of this carbon capture and storage schema to produce lower emission and lower cost energy development so therefore this whole scheme could collapse because it won't generate enough capacity to become economically self-sustaining over long periods of time i.e thousands of years that the material would be stored which undermines the financial and institutional capabilities to run these enterprises. From an economic standpoint it would be cheaper to do what needs to be done with developing alternative energies as opposed to developing a capture and storage schema that may be economically unsustainable. It could make everyone of the sites a Superfund site on a global basis. It is also possible that there will be knowledge spillovers were individual firms will not typically take on investments for the good of the broader industry or society as a whole unless there is a clear return on investment to the firm. Therefore the private market has a limited incentive to invest in “shared learning” that would lead to an improved economic outcome for society as a whole. This market failure is most pronounced for research in the basic sciences, which can yield highly valuable but difficult to appropriate economic returns18.


It is apparent from the research today that what is being created here is a model very similar to that of the nuclear storage debacle we are now faced with. The total cost of a global basis of the nuclear storage issue is currently unknown we will now compound this issue with a CO2 storage issue the cost of which will continue to rise on an unknown basis with many if not more of the problems illustrated within this short editorial. Hence Just because we can do a thing it does not necessarily follow that we must do that thing the wiser choice for risk management is to fix this problem in the appropriate manner as stated by the IP CC and other scientific reports which is to shut down coal-fired power plants and other producers of heavy carbon dioxide in the atmosphere. “So, if we want to solve the climate problem, we must phase out coal emissions. Period”. 20.

Recent studies in the journal of Nature Geoscience indicate that the effectiveness of different types of sequestration and their associated leakage and the long-term projections over 100,000 years show that deep ocean storage leads to extreme acidification of the oceans and CO2 concentrations in the deep ocean, together with a return to the adverse conditions of a business as usual projection with no sequestration over several thousand years. Geological storage may be more effective in delaying the return to the conditions of business as usual projections especially for storage in offshore sediments. However, leakage of 1% or less per thousand years from an underground stored reservoir, or continuous resequestration far into the future, would be required to maintain conditions close to those of a low-emission projection with no sequestration21. It is apparent from these studies that it is best to do the right thing in the beginning which is to shut down coal-fired emission sectors of electrical grids worldwide seek immediate Manhattan Project style intervention for alternative low carbon emission electrical grid capabilities and not have mankind burdened with the nuclear waste style carbon sequestration. The carbon sequestration CO2 amounts would be massive and carry with them all of the liabilities indicated herein.


1 Report of the Interagency Task Force on Carbon Capture and Storage, August 2010, page 19

2 Published online 19 July 2010 | Nature 466, 425 (2010) | doi:10.1038/466425a, author Hannah Hoag - Report maps perils of warming

3 Copyright © National Academy of Sciences. Permission is granted for this material to be shared for noncommercial, educational purposes, provided that this notice appears on the reproduced materials, the Web address of the online, full authoritative version is retained, and copies are not altered. To disseminate otherwise or to republish requires written permission from the National Academies Press. Climate Stabilization Targets: Emissions, Concentrations, and Impacts over Decades to Millennia Committee on Stabilization Targets for Atmospheric Greenhouse Gas Concentrations; National Research Council, 2010, page 16

4 Report of the Interagency Task Force on Carbon Capture and Storage, August 2010, page 25

5 Report of the Interagency Task Force on Carbon Capture and Storage, August 2010, page 29

6 Report of the Interagency Task Force on Carbon Capture and Storage, August 2010, page A- 20

7 Report of the Interagency Task Force on Carbon Capture and Storage, August 2010,page 33

8 Report of the Interagency Task Force on Carbon Capture and Storage, August 2010,page 34

9 Report of the Interagency Task Force on Carbon Capture and Storage, August 2010, pages 36 - 37

10 Reportof the Interagency Task Force on Carbon Capture and Storage, August 2010, page 42

11 Report of the Interagency Task Force on Carbon Capture and Storage, August 2010, page 43

12 Report of the Interagency Task Force on Carbon Capture and Storage, August 2010, page 42

13 Report of the Interagency Task Force on Carbon Capture and Storage, August 2010, pages42

14 Report of the Interagency Task Force on Carbon Capture and Storage, August 2010, pages C-6

15 Report of the Interagency Task Force on Carbon Capture and Storage, August 2010, pages 47

16 Report of the Interagency Task Force on Carbon Capture and Storage, August 2010, pages 44

17 Report of the Interagency Task Force on Carbon Capture and Storage, August 2010, pages 54

18 Report of the Interagency Task Force on Carbon Capture and Storage, August 2010, pages 55

19 Report of the Interagency Task Force on Carbon Capture and Storage, August 2010, pages 56

20 Storms of my Grandchildren -- The Truth About the Coming Climate Catastrophe and Our Last Chance to Save Humanity. James Hansen, 2009 page 176

21 Long-Term Effectiveness and Consequences of Carbon Dioxide Sequestration, Gary Shaffer, Nature Geoscience, Volume 3, July 2010