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GAO: No Clean Coal Technology Without Price on Carbon Pollution

Another blow to the “breakthroughs will save us” bunch

CAP’s Daniel J. Weiss reports on the new GAO report on CCS. For background, see “Is coal with carbon capture and storage a core climate solution?

The Senate clean energy and global warming debate should begin the week of July 26th. As it looms closer, Senators John Rockefeller (D-WV) and George Voinovich (R-OH) introduced comprehensive legislation to invest in “carbon capture and sequestration” technology (often called “clean coal”) that would capture and permanently store 80 percent or more carbon pollution from coal fired power plants. Yet they oppose legislation to shrink carbon pollution, which would create a market for CCS technology. On Friday July 16th, the Government Accountability Office unmasked the inconsistency of this approach when it determined that CCS remains an “immature” technology, and a price on carbon is essential to its development and deployment.

GAO found that many barriers remain before widespread adoption of CCS:

DOE does not systematically assess the maturity of key coal technologies, but GAO found consensus among stakeholders that CCS is less mature than efficiency technologies.

Commercial deployment of CCS is possible within 10 to 15 years.”¦ [Problems include] the large costs to install and operate current CCS technologies, the fact that large scale demonstration of CCS is needed in coal plants, and the lack of a national carbon policy to reduce CO2 emissions.

GAO concluded that a mandatory reduction in carbon pollution was essential for CCS to blossom.

Without a tax or a sufficiently restrictive limit on CO2 emissions, plant operators lack an economic incentive to use CCS technologies. Reports by IPCC, NAS, and the Global CCS Institute have all highlighted the importance of a carbon policy to incentivize the use of CCS.

Three days before, Senators Rockefeller and Voinovich introduced the “Carbon Capture and Storage Deployment Act,” S. 3591. George Peridas of NRDC provides a helpful summary.

* Devotes up to $0.85 billion to research and development programs for CCS;

* Funds early CCS projects through a wires charge on fossil-based electricity generation, by collecting around $2 billion/yr for up to 10 years. This is along the lines of the Waxman-Markey provisions passed last year by the House, which survived in the Kerry-Boxer and Kerry-Lieberman proposals in the Senate.

* Extends existing loan guarantees of up to $20 billion for projects related to CCS infrastructure”¦as well as tax credits, for up to 10 gigawatts “¦of CCS deployment;

* Creates an incentive program for up to 62 gigawatts of CCS capacity, through tax credits and bond interest payment assistance;

* Creates a new emissions performance standard for new coal-fired powered plants initially permitted between 2010–2020;

Aside from lacking a limit on carbon pollution, there are other important concerns about this bill.

The bill’s $850 million for research and development is unpaid for. The tax credits to employ 62 gigawatts of power plants with CCS could cost billions of dollars. It too lacks funding. If these provisions were part of a bill to limit carbon pollution, they could be paid for with revenue from the auction of pollution allowances. Without such a program, these measures would require deficit spending.

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The bill requires that power plants eventually reduce their carbon pollution by fifty percent, but not until at least “January 1, 2030” — twenty years from now. We cannot wait that long to act. NASA reported that the 2000’s was the hottest decade on record, and the last six months were the hottest on record too. In contrast, the American Power Act requires compliance with a pollution limit for power plants ten years earlier.

Senators Voinovich and Rockefeller have yet to support global warming pollution reduction legislation. Both voted for Senator Lisa Murkowski’s resolution to overturn EPA’s endangerment finding, which would have blocked President Obama’s clean car standards that even had the auto companies’ support.

Senator Voinovich and all other Republican members skipped the Senate Environment Committee vote on the Clean Energy Jobs and American Power Act, S. 1733, last fall.

Senator Rockefeller introduced the “Stationary Sources Regulatory Delay Act, S. 3072, which would block EPA from taking any steps to reduce global warming for two years, which would delay progress for double that time. Upon its introduction, he said that the bill would

Safeguard jobs, the coal industry, and the entire economy as we move toward clean coal technology”¦Congress, not the EPA, must be the ideal decision-maker on such a challenging issue.

As Senate floor debate is about to occur so that Congress can be the decision-maker, Politico reports that:

West Virginia Sen. John Rockefeller (D) has also spoken up more aggressively in recent weeks about his opposition to such [global warming] measures.

On Friday July 16, Carte Goodwin was appointed to replace the late Senator Robert Byrd. At his first press conference the new appointee joined Senator Rockefeller in opposition to global warming pollution reduction legislation.

From what I’ve seen, they are simply not right for West Virginia”¦I will not support any piece of legislation that threatens any West Virginia job or any West Virginia family.

GAO determined that CCS technology — essential for West Virginia families and jobs in a carbon limited future — can not succeed without such legislation.

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Seven months before the GAO report, Senator Byrd knew that the best hope for West Virginia was to include CCS incentives with a limit on carbon pollution. These measures were included in S. 1733.

I have spent the past six months working with a group of coal state Democrats in the Senate”¦drafting provisions to assist the coal industry in more easily transitioning to a lower-carbon economy”¦These are among the achievable ways coal can continue its major role in our national energy portfolio. It is the best way to step up to the challenge and help lead change.

As one of his final votes, Senator Byrd opposed Senator Murkowski’s amendment. He said:

I believe that the measure that we are being asked to vote upon today is extreme”¦.

Finally, mark my words, the regulation of greenhouse gasses is approaching, whether done by Congress or by regulation.

Senator Byrd knew that the future of coal depends on investments in carbon capture and storage technology combined with declining limits on carbon pollution. GAO just confirmed his wisdom. It’s now up to Senators Rockefeller, Voinovich, and Goodwin to get serious about CCS by supporting Senator Reid’s legislation to limit carbon pollution from utilities.

— Daniel J. Weiss

JR: This analysis is yet more evidence that an R&D-only approach can’t avert catastrophic global warming (see The breakthrough technology illusion and Bill Gates is wrong about “energy miracles”). CCS in particular simply is too implausible without a shrinking cap and rising price (see Harvard stunner: “Realistic” first-generation CCS costs a whopping $150 per ton of CO2 “” 20 cents per kWh! and here). To make CCS viable, you’d need a massive injection of demonstration funding (which could realistically only come from a bill that is paid for by making polluters pay) and the certain knowledge of a serious CO2 price in the foreseeable future.