5.1 Importance of CCS in developing countries

In order for CCS to play a role in reducing global CO2 emissions on a significant scale, it will need to be deployed in both developed and developing countries (‘Annex 1’ and ‘Non-Annex 1’ countries respectively, under the UNFCCC), particularly since it is expected that in the coming decades all the net fossil fuel growth (and associated CO2 emissions) will come from developing countries. The IEA estimates that 70 per cent of CCS deployment will need to happen in non-OECD countries to achieve global emission reduction targets by 2050 (IEA 2012b).

A substantial challenge for many developing countries is to increase access to energy in a sustainable, climate-friendly way. Many developing countries are also interested in continuing to utilise their indigenous fossil fuel resources to ensure energy security and to continue to benefit from them economically.

While developing countries may face many obstacles to CCS deployment, under the UNFCCC Annex 1 parties have agreed to assist developing countries to undertake mitigation action. As previously reported in the Global Status of CCS: 2011, since 2009 a number of governments and organisations have collectively contributed or allocated hundreds of millions of dollars to current and future activities to support CCS capacity and project development in developing countries. Organisations and countries that have contributed significant funds in this space include the EU, the Global CCS Institute, the Norwegian Government, the UK Government and the US Government. These contributors have provided direct support by financing specific activities, as well as contributing to CCS capacity development funding mechanisms managed by organisations such as the ADB, APEC, the CSLF, the World Bank, and the Institute itself.

The most significant funding contribution in 2012 has come from the UK Government. At the CEM held in London on 25–26 April 2012, the UK Government announced £60 million to support CCS in developing countries, in response to a call for funding from the Working Group on CCS Funding Mechanisms for Developing Countries, a subgroup of the CEM Carbon Capture Utilisation and Storage (CCUS). Action Group.

The significant emission reductions that can be obtained by CCS underpin the international funding support outlined above, but emission reductions need to be realised at the project level within individual countries. However, a number of recurrent concerns are shared by a number of developing countries. Key concerns tend to include the high cost of CCS, access to energy, and permanence of storage. This underlies the importance of capacity development and knowledge sharing, even at the early stages, to help countries:

  • Analyse the costs of CO2 mitigation efforts compared to the cost of climate change impacts on health, population migration, catastrophic events, etc. The IEA estimates that abandoning CCS as a mitigation option in electricity generation increases investment cost in other low-carbon technologies by 40–57 per cent in order to meet emissions reduction targets (IEA 2012b)
  • Keep abreast of developments in capture and compression technology. Reducing the energy penalty will be vital for large-scale deployment of CCS, addressing not only a significant cost component but also the ‘energy access’ issue. However, it is only through ongoing research and development and ‘testing’ CCS at large-scale demonstration projects that the energy penalty issue can be addressed
  • Learn from the experience of existing pilot and large-scale demonstration projects, in particular about the monitoring, measurement, and verification techniques that can be utilised to track the permanence of CO2 storage.