Big coal slow to move on carbon capture

The Australian Coal Association increased spending on carbon capture and storage (CCS) projects in 2009-10, although progress has been slower than expected.

Accounts for the ACA’s Low Emissions Technology Fund show that $64 million was spent funding CCS projects last financial year, almost double the previous year’s $35.2 million.

The fund is the primary source of coal industry investment in CCS. When the so-called ”Coal21” fund was launched in 2006, it was meant to invest $1 billion in clean coal technologies over the next 10 years. So far it has spent a total of $100.4 million - a tiny fraction of the industry’s revenue.

ACA executive director Ralph Hillman said take-up of CCS ”all depends on a carbon price”. Mr Hillman said low-emission energy technologies were developing slower than unexpected due to policy uncertainty on climate change.

”All this is taking longer than everyone thought. Climate change policy in other countries has gone right on the backburner. It’s not a conducive environment.”

The Coal21 accounts show the bulk of total project funding in 2009-10 was spent on pre-feasibility studies for two CCS projects in Queensland - Zerogen ($39 million) and Callide Oxyfuel ($19 million).

Remaining project funding was spent on research including: $5.4 million allocated to Australian National Low Emissions Research and Development Ltd; $250,000 to the Otway Stage 1 storage project in Victoria, run by the CO2 Co-operative Research Centre; $175,500 for an assessment of CO2 storage sites in Queensland; and $159,123 to the Delta CCS project at Lake Munmorah in the Hunter Valley in New South Wales .

The Coal21 fund has a statutory obligation to spend $300 million on an Integrated Gasification Combined Cycle (IGCC) coal-fired power station in Queensland.

The Coal21 fund has invested in pre-feasibility studies for two IGCC projects: the Zerogen proposal for a 530 megawatt power plant near Gladstone, backed by Mitsubishi Heavy Industries, and the GE- and Xstrata-backed Wandoan Power Consortium, proposing a 334 megawatt plant.

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