Funding row threatens to delay CCS projects
A row over how to finance carbon-capture technology threatens to delay projects.
A dispute over funding between the European Commission and member states is threatening to delay pilot projects to clean up emissions from coal- and gas-fired power plants.
European leaders agreed in March 2007 to equip up to 12 power plants with carbon capture and storage (CCS) technology by 2015, to allow Europe to carry on burning coal while meeting its greenhouse gas reduction targets. But member states are now arguing with the Commission over who gets to choose which projects are selected.
Demonstration plants
Member-state officials are to vote on 2 February on Commission-drafted plans that set out the rules for funding demonstration plants. The thorniest question is whether national governments or the Commission will manage 300 million allowances from the EU’s emissions trading scheme. Those allowances – whose value will depend on the market price of carbon – are meant to provide some of the funding for CCS projects and ‘innovative renewables’. An additional €1.5bn has been earmarked for CCS from the European recovery plan, but the total cost of 12 CCS projects has been estimated at €7bn-€12bn.
Click Here: All Blacks Rugby Jersey
Germany wants the 300m allowances to be split among the member states, which would then select the projects. This is “crucial” for several member states, according to a memo drafted by German officials last year.
The British government also wants the final say over which projects are approved in the UK. Poland, another big coal-burner, is still examining the pros and cons of the Commission’s proposal, a Polish spokesperson said.
But the Commission is adamant that the funds should not be ‘nationalised’. Commission officials say that the Commission would withdraw its proposal rather than give up this principle. It fears that splitting the fund 27 ways would undermine Europe’s plan to test different types of technology in different geological sites.
2011 deadline
According to an unpublished Commission impact assessment, a “significant proportion” of the 300m allowances must be awarded by 2011 “at the latest”. Any delay in drawing up the rules “would substantially prejudice the chances of projects being operational by 2015”, it says.
Eric Drosin at the Zero Emissions Platform, a group that represents companies, researchers and campaigners in favour of CCS, said: “If we don’t go ahead on the 2 February we run the very serious risk of not being able to deliver on the EU’s request to deliver CCS demonstration by 2015.”
From start to finish, a CCS project will take 70 months to get up and running, he said.
“The EU has in some respects fallen behind other national projects. In the US and Canada, money has already exchanged hands to get projects off the ground… Where is the EU?” Drosin asked.