Global CCS Institute releases Global Status of CCS: February 2014 report

The Global Carbon Capture and Storage Institute has released the February 2014 edition of its annual review of the status of CCS across the world. Its general findings are that North America is leading the world in implementation (with the Boundary Dam project in Canada and the Kemper County project in the USA), that China is becoming increasingly important, and that Europe is lagging behind, though there has been encouragement with the UK government’s funding pledge for the White Rose project. The Middle East is also regarded as pioneering, with the world’s first large-scale CCS development in the iron and steel sector, the Emirates Steel Industries project, under construction. No new large projects have moved into operation over the past year, leaving the number at 12, though one (the Emirates project) has moved into the construction stage. In the planning phases (identify, evaluate, define) before the final investment decision, the trend of a gradual fall in the number of projects has continued, something that must be considered worrying, probably reflective of the costs and difficulties involved in the projects in construction and operation, and tightened government budgets. China is notable for having 6 of the 8 large projects in the identification stage. A recent call by Scottish CCS to include targets for CCS within the EU 2030 climate and energy framework may help, in the medium term, to address Europe’s general sluggishness.  The report reiterates the importance of CCS in the effort to control the release of greenhouse emissions worldwide.

Ethiopia planning to become regional electricity production powerhouse

The Financial Times has covered Ethiopia’s plans to become one of Africa’s top electricity producers, and an exporter to neighbouring countries such as Djibouti, Sudan and Kenya, and beyond. Currently there is some export, assisted by a difference in religion: predominantly Christian Orthodox Ethiopia consumes little power on the weekends, while Sunday is a working day in predominantly Muslim Sudan and Djibouti. Such export has served to demonstrate the potential economic benefits to Ethiopia of being a major electricity exporter, and the government has a 25-year master plan which aims to increase exports from the current 223 MW to 5 GW. Associated supporting projects to develop transmissions infrastructure are underway, funded by the African Development Bank and the World Bank, including a large link from Ethiopia to Kenya. There is already a memorandum of understanding to purchase Ethiopian electricity in place with Kenya, and talks are underway with Tanzania and Yemen for similar agreements. Power generation within Ethiopia is to be a mix of geothermal, solar, wind, hydro (with a controversial project proposal which includes damming the Blue Nile), and possibly conventional thermal power plants. Such a transformation in Ethiopia would also have the potential to turn it into an African superpower.

US Supreme Court to review EPA’s powers to set emissions rules

The US Supreme Court is to review the Environmental Protection Agency’s power to set greenhouse gas emissions rules for refineries, steel mills, and cement plants (amongst other industry) that are upgraded or expanded, with a ruling due in July this year. The review has been sparked by pressure from states and business groups opposed to the EPA’s power, and is the latest step in the legal saga surrounding emissions. A 2007 decision by the Supreme Court ruled that the EPA had the power to regulate greenhouse gas emissions under the Clean Air Act if they were found to be harmful. Following this, an EPA investigation concluded in 2009 that GHGs were in fact harmful, and in 2010 set the rules which are now under review. While some states are hostile to the rules, others are supportive, and the legal history seems to justify the measures the EPA has taken to date. The Supreme Court will hear oral submissions in late February. In an associated case, the EPA’s power to enforce rules covering power plant emissions that cross state lines is being considered, with a ruling also expected in July.

Foreign companies buying up Indian power generation assets

The Wall Street Journal has reported on a series of acquisitions of Indian power generation assets by foreign companies. At first glance, the trend is puzzling, as many of the assets being purchased (if operating) are losing money, coal supplies are not always assured, and India has been notorious for the slow process of project approvals. However, because of the shortage of power generation in the country, investors see a large potential for growth, and because many plants are currently unprofitable, asset prices are low. On top of this, investors are favouring plants currently in operation or construction rather than projects in the planning or development stages, in this way avoiding the approval barriers. Some of the foreign investors have been Singapore’s SembCorp Industries, Abu Dhabi National Energy Co, and GDF Suez. Time will tell if they prove to be sound investments.

Shand 6 MW test facility attracting interest from research groups

The test facility being built as an accompanying project to the Boundary Dam No. 3 Unit development (currently in test operation as one of the world’s first large scale CCS-equipped power stations) has been attracting interest from research groups around the world. The $CAN 64 million ($US 57.6 million/€41.9 million) facility, incorporated into the Shand Power Station in Estevan, Saskatchewan, Canada, will have 6 MW of power generation capacity along with 30-metre high desorber and absorber vessels for conducting experiments into the capture of carbon dioxide and noxious gases. It has been funded by SaskPower and Hitachi in a 50:50 split, and is due to be complete by mid-2014. SaskPower president and CEO Robert Watson has said that groups from China, India, Thailand, Britain, Norway, Poland, and United Arab Emirates, amongst others, have been in contact regarding using the facility, which will be open for hire by researchers from around the world (at a speculated cost of around $CAN 50,000/$US 45,000/€32,700 per day). It is expected that the facility will conduct the research that leads to more effective carbon capture in future CCS projects. Intellectual property will belong to whichever group carries out the research.

Iberdrola investing less in Spain and more in overseas markets

Spanish utility Iberdrola has announced its investment spending over the next three years, with only 15% of the €9.6 billion ($US 13.2 billion) of net investment money to be spent in Spain. With recent reductions in compensation for transmission of electricity and a 7% tax on all electricity generation, Iberdrola argues that the Spanish government is forcing the company to look overseas for attractive investment opportunities, with the UK, Mexico, Brazil and the US being the most attractive destinations. Iberdrola has shut three Spanish power plants in recent times, and has applied to the government to close a fourth, as profits are consumed by the regulatory system. “If the regulatory and legal framework isn’t clear enough, stable enough, predictable enough then the money won’t flow,” said CEO and Chairman Ignacio Galan. With around one third of Iberdrola’s business being done in Spain, the 15% investment figure suggests that Spain will in future play a smaller role in the company’s overall business.

Novatek vying for Russian LNG ascendency

The Financial Times has carried a piece on the rivalry between Russia’s oil and gas producers Gazprom, Rosneft and Novatek. Traditionally, according to the article, oil and gas have been seen as separate businesses, with Gazprom dominating the gas industry and Rosneft the oil industry, both being majority state-owned. In the mid 1990s, Novatek began as a start-up gas company, eventually rising to become a rival to Gazprom, and all three companies are now competing in the LNG export sector, after Russian president Vladimir Putin last year enacted a law breaking Gazprom’s monopoly on gas export. Novatek began a $US 27 billion (€19.7 billion), 16.5 million tonnes/annum LNG project with Total in 2007, which is expected to begin foreign export in 2017, becoming only the second operating LNG project in the country. Rosneft is currently diversifying from oil into gas, with its own plans to begin LNG production by 2018. It appears that the added competition is spurring development of the LNG sector within the country. Russia plans to double its share of the global LNG market to 10% by 2020, when LNG is projected to form 15% of the world’s gas supply.

APR Energy to build gas-fired plant in Myanmar

American company APR Energy has won a contract to provide a 100 MW gas-fired turnkey power plant in Myanmar (Burma), as the rapid development of the country continues following its 2012 political thaw. Japanese companies have been at the forefront of the push into Myanmar, but a handful of American companies have also made an entry, including General Electric. The APR Energy plant will be composed of mobile gas power modules, a bridging solution for providing electricity while larger, longer-term power generation capacity is developed. The country certainly needs it – according to APR, three-quarters of the population of Myanmar are without electricity. The plant is to be up and running within the second quarter of 2014, and run until the end of 2015.