Front Burner - COP26: A carbon capture reality check

Episode Date: November 3, 2021

Over 50 nations arrived at COP26 with net-zero emissions targets, but many rely on high hopes for carbon capture tech. Today, a reality check — will carbon capture help us, or provide excuses for more pollution?

In the Dragon's Den, a simple pitch can lead to a life-changing connection. Watch new episodes of Dragon's Den free on CBC Gem. Brought to you in part by National Angel Capital Organization, empowering Canada's entrepreneurs through angel investment and industry connections. This is a CBC Podcast. Hi everyone, Angela Starrett here. And if you've been listening over the last couple of weeks, you've probably noticed I've been filling over the last couple of weeks you've probably noticed I've been filling in for Jamie and maybe you're wondering why well Jamie is just taking a bit of time to spend with her family and and she'll be back soon so in the meantime you're

stuck with me and on that note a couple of things about me I've been a reporter at the CBC since 2003 I'm in Vancouver and I do all sorts of different kinds of reporting, radio, TV, digital, investigative, and now I guess I and ensure they decrease tomorrow at a pace and scale needed to reach net zero by 2050. That was Prime Minister Justin Trudeau earlier this week at the UN Climate Summit in Glasgow. This is one of the big ones, COP26, where leaders from all over the world get together and make commitments about how they plan to steer the world away from a climate catastrophe. And for years now, one of the ways the government and industry say they'll do this is through carbon capture and storage.

Here's Alberta Premier Jason Kenney just yesterday reacting to the PM's promise to cap oil sands emissions. The single most important way the Prime Minister could help us would be putting real resources behind a huge expansion of Alberta's carbon capture and storage technology. Today, a reality check on carbon capture. Nicholas Kuznets is here with me, and he covers oil and gas for Inside Climate News. And he's going to explain why tech, meant to clean up energy and industry, is sometimes panned as an excuse to pollute even more. Plus, a bit later, my colleague Chris Brown went to Sweden to learn how a collection of enormous vans could help with carbon already in the atmosphere.

Hey, Nicholas. Hi, thanks for having me on. Thanks for joining us. So help me understand here, when people talk about carbon capture, you know, in the traditional sense of it, what are we talking about here? So traditionally, carbon capture is about removing carbon dioxide from the pollution that's coming out of smokestacks. So from power plants or industrial processes, things like natural gas processing,

you know, making fertilizer like that. And in general, who's behind the big capture operations that use this tech? So the biggest player has been the oil and gas industry. The oil and gas companies started developing some of the technologies behind this decades ago. And it was really useful, particularly when processing natural gas, which it comes out of the ground. And what the companies really want is methane, but sometimes there's a lot of carbon dioxide mixed in. And so in order to sell the methane, they need to take the carbon dioxide out. So that was kind of the old origins. But I think maybe when people started to hear about it more and talk about it more,

was in the early 2000s, the coal industry sort of latched onto this technology as a possible future when people were talking more and more about trying to limit emissions. And so the hope then was that you could attach this technology to a coal-fired power plant and take the carbon dioxide out of the emissions. You know, when the carbon is captured, it's obviously got to be stored somewhere. Right now, where is most of that carbon going? The vast majority of the carbon dioxide that's captured now ends up being injected into old oil fields in order to push more oil out of the ground. Particularly in the United States, where most of the carbon capture is happening,

that's where pretty much all of it is going. So it's actually helping to produce more oil. Oil companies say that the carbon stays underground after it's pumped into oil fields, as you say. But what indication do we have that it's actually safe there? Well, so first of all, there has not been a ton of independent monitoring. I mean, for the most part, this practice, as I mentioned, has been done for a long time, for decades even. And mostly the idea was just about getting the oil out of the ground. They weren't paying quite as much attention to the carbon dioxide. That said, research suggests it definitely can be done safely, you know, if the right steps are taken. And some of the biggest dangers are when it is injected into old oil fields because these oil fields will have old wells drilled into them.

And those, if they're not plugged properly, can leak out the gas. And this has happened. There have been accidents. In one case in Wyoming, a school had to be closed when it was filling up with dangerous levels of carbon dioxide because there was an old well that was not properly plugged. That's definitely, of course, a huge concern. In July, over 500 environmental groups signed a letter urging the Canadian and U.S. governments to stop investing in all carbon capture. Given that this is money that could help clean up big emitters, big emissions, what are they concerned about? Well, I think you touched on one of the big concerns. This has been for a long time is that it'll really sap attention and funding from the much more important task of switching to clean energy.

Beyond that, I mean, there's the concern that in a real pragmatic way, any money and investment that goes towards carbon capture could end up extending the life of fossil fuel infrastructure, you know, things like power plants, if it's attached to power plants, and be an excuse to burn more fossil fuels when really, certainly in the power sector, it's a much cheaper, more viable alternative currently to simply replace it with solar and wind power. And I want to talk a little bit more about how are these carbon capture operations right now making themselves financially viable? Sure. Well, one piece is the fact that, with few exceptions, they're selling the carbon dioxide they capture to oil companies, which are injecting it underground. So that's one source of revenue. The other piece

is countries around the world, particularly in Europe, United States, and Canada have been putting in place incentives, tax incentives and subsidies, you know, various forms of support to try to get this technology going. So, I mean, the idea for a lot of this is to encourage innovation and to kind of get the technology tested and viable. But I think a lot of the concerns is that in practice, it's worked out in many cases as an incentive for a type of oil production. And a lot of the times it's oil companies that are some of the biggest proponents and beneficiaries of these.

And so there's a lot of concern that it's kind of working out to be a new kind of subsidy for the industry. At Chevron, we're working to find new ways forward, like through our venture capital group, backing technologies like electric vehicle charging, carbon capture, and even... Global demand for energy is increasing,

and the challenge is to meet this demand while reducing our carbon footprint. Part of Shell's solution involves carbon capture and storage. And that's why we built Quest. We know that Canada is sinking a lot of money into this capture tech. Over $300 million is slated for a research and development tax credit over the next seven years. And Ottawa is consulting on an investment credit it says will go to a range of capture techniques as long as the carbon isn't put back into oil production. I mean, since the U.S. has had a tax credit for carbon capture for over a decade, I'm, how has that money actually brought the U.S. closer to its

climate goals? I think there's debate on that question. A lot of the money has potentially gone to practices that would have been done anyway. I mean, for the most part in the U.S., the kind of facilities that have carbon capture attached to them, The biggest one is run by ExxonMobil, and it's a gas processing plant where they're producing natural gas from a field that has a ton of CO2 mixed into it. They're actually required to capture that CO2 anyway. But I think that the proponents would say that the value of the incentives hasn't been high enough to really spur the innovation they're looking for. And in the U.S., the tax credit was increased a couple of years ago. And actually right now in Congress, as part of President Biden's climate and social legislation, they're looking at a whole

range of direct subsidies and increasing the value of that tax credit that a lot of people think could make a big difference. So far, carbon capture really remains kind of a niche technology. The capacity is really low still. It's not in any way sort of a significant piece of reducing emissions at this point. A group of Canadian oil and gas companies made a pretty bold ask this year requesting our government pay for 75% of carbon capture facilities through tax credits. In Canada, of course, the oil sector has a particular interest, I think, in getting this developed. You know, Canada's oil is mostly coming from the oil sands, which are among some of the most carbon intensive sources of oil globally. If the country and those companies want

to continue producing that oil far into the future, even as the world, you know, hopefully begins to use less and less oil, carbon capture would be kind of a really critical tool for them to cut their own emissions. Now, of course, it's important to add, though, even if the producers are able to cut their own direct emissions that are associated with, you know, mining and pumping the oil, that's just a small fraction overall. The vast majority of the emissions associated with oil come when it's burned in the final product, you know, in a car, in a plane or whatever. And we've also heard concerns about the reality of whether these plants can keep their promises. For example, the Boundary Dam coal plant in Saskatchewan started a carbon capture operation in 2014, saying it would trap a million tons of carbon pollution a year. They received millions from the government to do this. Seven years later, it's apparently only captured 4 million tonnes total.

And instead of aiming to capture 90% of emissions, it's now looking at 65. Former Premier Brad Wall called it a weapon against the high emissions using coal. But as of today, there's no immediate plans for further expansions. SaskPower says it won't be equipping two additional units at Boundary Dam with the technology. It says there simply isn't a business case for it. Has the promise of carbon capture projects you've seen, you know, lived up to the hype? No, is the short answer. And the history, the technology's history is certainly a troubled one for any of these other sectors where it would play potentially any, you know, a larger role in cutting emissions. There was another power plant in Texas.

It's their very own version of a ribbon cutting. Carbon capture facility Petronova opening the valves in Fort Bend County. Captures a ton of carbon dioxide. Where again, there was, you know, support and a lot of hope around it. And it was running. It was never even intended to capture all of the emissions from this power plant, which was a coal power plant, but it failed to hit all of its targets. And then as the economy crashed and oil prices importantly crashed at the beginning of the pandemic, the operator of it had to shut down the carbon capture piece. They couldn't get enough money for the CO2 they were

capturing to justify continuing to run. And then later that year, they announced that they actually were just suspending indefinitely. So I think Boundary Dam is the only power plant in the world that has carbon capture on any kind of commercial scale. It's faced trouble in a lot of places. There's been billions sunk into it here in the U.S. for power plants that were never built. And I guess all this raises the obvious question. I mean, for what reason would we invest in carbon capture tech instead of spending on renewable energy and reducing emissions in the first place? Right. And this is where it becomes a complicated and I think an interesting issue, because there is this emerging group of people from the sort of policy world, science world, even some advocates, not as many, that have made the case that there are little niches where this could be really promising. Cement and steel, those together account for a really significant portion of global emissions. And right now, there isn't really a good alternative for making them without releasing

all that carbon dioxide to the air. So people say that carbon capture could be a really important role in getting rid of those emissions. There's also increasingly the realization that no matter how quickly we phase out fossil fuels, there's going to be too much carbon dioxide in the air and we're going to need to remove some of it. And so some of the technologies around carbon capture are similar. There's a sort of an emerging field called direct air capture, where rather than removing it from power plants or industrial plant, it's just sucking the CO2 straight out of the air. And so I think people are starting to make a case that those two areas could be really promising for the future.

They could be things that we really need. And so we need to develop this technology in order to apply it there. And so the trick becomes, well, how can you do that? How can you kind of develop this, what remains a really expensive technology that we might need in the future without it becoming kind of an excuse to continue to burn fossil fuels, which is what obviously we need to be using less of. Nicholas, thank you so much for taking us through this story today. It's really great to talk to you.

Yeah, thank you so much for having me. It's been a pleasure. In the Dragon's Den, a simple pitch can lead to a life-changing connection. Watch new episodes of Dragon's Den free on CBC Gem. Brought to you in part by National Angel Capital Organization. Empowering Canada's entrepreneurs through angel investment and industry connections. Hi, it's Ramit Sethi here. You may have seen my money show on Netflix. I've been talking about money for 20 years. I've talked to millions of people and I have some startling numbers to share with you. Did you know that of the people I speak to, 50% of them do not know their own household income. That's not a

typo. 50%. That's because money is confusing. In my new book and podcast, Money for Couples, I help you and your partner create a financial vision together. To listen to this podcast, just search for Money for Couples. So, Nicholas mentioned that despite activists' pretty broad opposition to carbon capture from oil and gas, some are still hopeful about an emerging technology called direct air capture. The criticism remains that this can provide cover for industry to keep emitting. But the world's largest air capture facility, known as ORCA, just opened up in September. And according to the CEO of Climeworks, which runs this plant, it uses clean power, it doesn't give carbon to oil recovery, and it's extracting carbon right out of the air.

We need direct air capture as a solution for stuff we cannot reduce otherwise. It's emissions from agriculture, it's emissions from operations that physically have a hard time to avoid CO2, like aviation or some parts of shipping or long-haul trucking. To some degrees, they clearly will work on their processes and become less emitting in the future. But some degree will always remain that needs to be compensated with CO2 removal. CBC foreign correspondent Chris Brown went all the way to Iceland to see Orca. And he's with us now to explain what the hope is. Hey, Chris. Hello. So Chris, since this tech is so new, I was hoping you could describe the scene in Iceland to me. What

does the Orca plant actually look like? So if you go outside of Reykjavik, 45 minutes outside the city, there is a plain of lava. And right next to that, there's a bubbling, gurgling volcano. And you can see vents of steam coming up. And right there, they put a geothermal plant. And the steam vents go deep into the mountain and they come up and they power clean, cheap electricity that heats everything. The entire city of Reykjavik is almost heated by this plant. And right next to that,

if you can imagine, say, maybe six shipping containers with the sides taken off and a whole bunch of fans in them, really, I mean, I don't want to sound uncharitable. It's like an oversized kitchen hood fan that they have, about six of them. And literally, these fans suck in clean air from Iceland, the atmosphere, and the filters get full. They heat it up with a blast of steam that essentially shakes the CO2 loose and it's piped away from the orca plant to the next phase. And that is where it is entombed underground. They mix it with water, the CO2 gas. This is a separate company called CarbFix. And they blast it

underground because Iceland is made up of volcanic basalt rock, it chemically alters the gas and turns it into a solid. They're saying that Iceland's lava beds alone could hold somewhere around 50 times the annual emissions from the world. They're that porous and it's that good of a place to put CO2. These types of rocks are found elsewhere in the world. They're found in America, they're found in Canada, India, they're found in Japan. So the storage space is more than what we need if we were to burn all the fossil fuels on Earth.

All of these things really weren't necessarily possible to do even 10 years ago. And you add on to that now that there's actually a developing market of companies that will pay, in some cases, hundreds of U.S. dollars a ton to have the carbon taken out of the air. And so you're seeing the beginnings of this market. I mentioned that this is currently the biggest facility of its kind in the world. How much carbon is it actually able to take out of the air? Yeah, so that's, it is the biggest in the world, but it's still not very big. When you look at the 4,000 tons it can take out of the air. Yeah, so it is the biggest in the world, but it's still not very big. When you look at the 4,000 tons it can take out a year, about 10 tons a day, it's like, huh, how much is that really?

It really only amounts to a few seconds. But the idea here is that they will scale up and they'll go, perhaps in 20 years, they'll be pulling 30 to 50 million tons of carbon out of the air. There's another company, a Canadian company, Carbon Engineering in Squamish, BC. They're building a plant. They're designing it right now down in West Texas. That will have the capacity of 1 million tons a year. And of course, one big part of whether we can scale up these climate operations is the cost. There's activists who argue money could be more effective if spent on planting trees or transitioning to renewables. So right now, how much does it cost to remove just one

ton of carbon from the air? It's expensive. Anywhere from $500 US a ton, $700 US a ton, because it is brand new. I know the folks at Carbon Engineering expect they'll be able to get their costs down to under $200 US a ton. Our prices for removal, permanent removal from our first plant start at $300 a ton. We are very confident those prices will come down, but only if we deploy. Just like you have a laptop and you have a mobile phone because people bought the first mainframes and the first large-scale computers many years ago, we need to deploy to bring costs down.

And we're very confident that will happen. That's where you start to be able to get stuff happening because you've got carbon taxes, you've got tax credits and so forth. So this is what I think is exciting for people in the industry. Christoph Gebald, who was talking to me from Climeworks, he likened it to being in the same situation as the wind industry was or the solar industry was 15 years ago, that their costs were extremely high. And then they started to fall. And as they started to fall, the plants got bigger. So you're in at the beginning on this high costs.

Again, a lot of potential. The field we are working in, carbon dioxide removal, is a niche, or most people haven't even heard about it. But my hope is that that will be recognized and implemented, so to say, in the strategy, in the how. How are we getting to net zero? That is my hope. Making this abstract thought tangible. And this is how it looks. This is the amount of CO2.

This is what it costs, etc. Thank you so much for this, Chris. Thank you. Good to be in the show again. And that's it for today. I'm Angela Starrett. Thanks so much for listening to FrontBurner. Aunt Berna.