Final report for One North East And NEPIC 21/12/10 - The Carbon ...

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The case for a Tees CCS networkFinal ReportThis is a systemic issue that affects all CCS networks in the UK and Europe and so canbest be dealt with at the level of European and national Government.In addition the North East region specifically faces additional barriers:Lack of credible independent examination of CO 2 storage optionsInsufficient organisation of stakeholdersDiversity of CO 2 sources implies cross-industry coordination will be needed todevelop an optimum common CO 2 entry specification for any pipeline.Whilst not a barrier per se, improved public or political awareness and support fordeployment of CCS in the North East or by large industrial or gas power sector CO 2emitters could increase the likelihood that optimal choices become available in a timelymanner.7.2 Recommended actions to deliver a North East CCS networkAssuming stakeholders agree that CCS offers genuine opportunities to protect the NorthEast economy from the threat of higher carbon prices and regulation, then considerableactivity on the part of many stakeholders is required to remove the barriers to deploymentof CCS infrastructure in the North East.Many of these barriers are common to other places where CCS deployment is beingconsidered. There are already a number of multi-stakeholder organisations examiningenergy, climate and CCS issues nationally and internationally. The UK Government andsome of the companies in the North East are already involved in these activities and thereis no requirement to duplicate this activity.There is however a real opportunity for ONE 95 /NEPIC stakeholders to protect value at riskin existing businesses in the Tees Valley and create new business opportunities bycontributing in a coherent manner to policy development on CCS development,demonstration and deployment, including broader energy, industrial and climate policies.Recommendation One – Improve organisation of stakeholders in a North East CCSnetwork.Recognising that regional partnerships in Scotland, Yorkshire, Rotterdam 96 , and NorthernNetherlands, have been efficient in monitoring, influencing and directing CCStechnologies, markets and regulations to the benefit of their regional stakeholders, thisreport recommends that One North East (and successor organisations) and The NorthEast Process Industries Cluster should seek to establish an appropriate organisationalstructure to monitor, influence and direct regional CCS deployment most efficiently. Therecently formed PICCSI group represents an excellent start in this process.One option to achieve this is to ensure the Tees Valley becomes a Low Carbon EconomicArea for CCS. 97 Within this structure, the proposed level of organisation could be a „NorthEast CCS Task Force‟ and should ideally include:95 Or alternative strategic North East economic partnership or successor body.96 See for example http://www.rotterdamclimateinitiative.nl and http://microsites.ccsnetwork.eu/rotterdamroad97 This could provide a means of bringing together formally diver stakeholders that could impact the timing,likelihood and amount of investment ( including BIS, DECC (primarily the Office for CCS but also the oil and gasdivision), HM Treasury, The Crown Estate, environmental NGOs, local population, European Commission,Ofgem, HSE, fuel suppliers, offshore industry and potential financiers).66
The case for a Tees CCS networkFinal Report Private sector representatives from large existing and potential Tees Valley CO 2emitters (and medium-sized emitters subject to interest). Public sector representatives with responsibilities for spatial and economicplanning, climate and energy policy, and the regulatory frameworks for CO 2capture, transport and storage. Potential providers of CO 2 capture, transport and storage facilities. (Oil companiesinterested in CO 2 -EOR could also be included).Recommendation Two – Use the improved organisation to assist the developmentof a CCS network.Recognising that stakeholders will be impacted by international developments in climate,energy and CCS, the Organisation should evaluate the local impacts from:Global and European energy and climate policies.Global and North Sea Basin-related CCS technology and market developments.This would include RD&D, regulations, economics, social acceptance, regionalinitiatives, and health, safety and environmental aspects of CCS system designand operation.Legal impediments to commercial discussions between stakeholders and to CCSdeployment.The ownership, strategies, or activities of key stakeholders and associations.The Organisation should influence :The design of European, UK, North East and local policies, regulation and otherinitiatives for CO 2 capture from the coal, gas and industrial sectors and for CO 2transport and storage infrastructure.Regional and local public and political opinion on CCS.The priorities of trade associations (e.g. CCSA, CIA).The priorities for UK and regional public and private CO 2 storage evaluation.National planning for energy, CCS and offshore infrastructure.Further the Organisation should seek to act as a single point-of contact to control directly: Shared responses to Consultations. 98 Marketing of a CCS network to wider stakeholders. Contractual commitments between stakeholders (e.g. emitters and transportcompany) to use network if available, to ensure these are compatible with widerobjectives. The design specification of CO 2 transport and storage infrastructure (capacity,location, entry/exit specifications). Engagement with other regional CCS networks (for example in Scotland,Yorkshire and Rotterdam) on issues of common interest.98See for example recent electricity market and CCS related consultations listed athttp://www.decc.gov.uk/en/content/cms/consultations/open/open.aspx , the carbon floor price consultationavailable at http://www.hm-treasury.gov.uk/consult_carbon_price_support.htm and ongoing updates to nationalplanning policy consultations such ashttps://www.energynpsconsultation.decc.gov.uk/docs/ConsultationDocument.pdf67
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