Late last month, the Intergovernmental Panel on Climate Change (IPCC) released its latest report on climate change and carbon emissions, which noted that “atmospheric concentrations of carbon dioxide . . . have increased to levels unprecedented in at least the last 800,000 years.” The International Energy Agency (IEA) recently called carbon capture and sequestration (CCS) a “critical greenhouse gas reduction solution” and “an integral part of any lowest-cost mitigation scenario.” It projected that CCS will need to grow in output by at least two orders of magnitude by 2050 to meet emissions reductions targets. Even the World Coal Association has called for expanded use of CCS to enable coal plants to continue operating.

But behind these calls to action lays a distressing trend: CCS has so far proven unable to keep up with demand. Even worse, progress toward large-scale CCS deployment appears to be slowing, according to a report released today by the Global CCS Institute.

While four new projects came online in 2012, the report noted that the number of projects currently under development shrank from 75 last year to 65 this year, with several high-profile projects being canceled. Since last year, five CCS projects have been canceled, one has been downscaled and seven have been put on hold. Against this were only three new projects being launched.

Oxford University professor Myles Allen, one of the lead authors of the IPCC report, said in the statement released by the Global CCS Institute that CCS was a “pivotal technology” for addressing climate change. “Fossil fuels are useful, plentiful and affordable, so of course we will continue to use them,” he said. “To exploit this resource to the full, without further damaging the planet, we need CCS.”

Much Talk, Little Action

So far, however, progress has been achingly slow. Only 12 full-scale CCS projects are in operation worldwide, with a capacity of only 25 million tons per year (mtpa). Eight more are under construction. The IEA projects that a total CCS capacity of 8,000 mtpa will be necessary by 2050.

The report blames the lagging pace on policy rather than technology. “The major impediment to CCS progress is not considered to be technical uncertainties but, rather, insufficient policy support exacerbated by poor public understanding of the technology,” it says. “Without sufficient policy incentives to attract private funding, it is difficult to create the economic or market conditions required for broad-based CCS demonstration (and deployment).”

Worldwide, the U.S. leads with 20 CCS projects in development. China is second with 12. Both countries have recently made public commitments toward developing CCS. The Obama administration has made CCS one of the central components of its climate change initiative, and China included CCS policy in its 12th Five-Year Plan, which began in 2011. Still, of the five canceled projects, four were in the U.S.

The picture is more dismal in Europe despite greater public focus on climate change. Notably, no new projects were launched in Europe this year and none are currently under construction. In fact, no large-scale CCS project has entered operation in Europe since 2008.

Last month, Norway decided to cancel its full-scale CCS project at Mongstad, citing high costs and high risks connected to the facility. The project at a Statoil refinery on the country’s west coast was projected to begin full operations in 2020.  Now, the Norwegian Ministry of Petroleum and Energy is reconsidering its strategies to ensure whatever program is settled on will be economic.

Power Failure

As challenging as the overall description in the report is, there are additional areas of concern in the details. One in particular stands out: Progress toward CCS applications in power generation has been especially slow. Of the twelve operating CCS projects, none involve power generation. Worse, the report notes that since 2012 alone, the number of CCS projects under development in power generation has fallen from 42 to 30, a 29% contraction in just 12 months. Since 2010, the CCS capacity under development in the power sector has fallen from nearly 90 mtpa to just over 50 mtpa.

All four of the cancelled U.S. projects were integrated gasification and combined cycle power plants: SCS Energy’s PurGen One plant in New Jersey; Tenaska’s Taylorville Energy Center in Nebraska and Trailblazer Energy Center in Texas; and the Erora Group’s Cash Creek project in Kentucky. The fifth cancelled project, in Poland, was a retrofit on an existing coal plant, the 5 GW Belchatow power station. Four of the seven projects placed on hold were connected to power generation; three were in Europe. In nearly every case, according to the report, the decision to cancel or suspend these projects involved unfavorable finances.

The majority of current operating large-scale CCS projects involve natural gas processing, with the captured CO2 being used for enhanced oil recovery (EOR). EOR has been touted as a key method for carbon sequestration, but projects outside of oil development areas have encountered problems with what to do with their CO2. American Electric Power decided to shut down its successful CCS demonstration project at its Mountaineer Power Plant in West Virginia in 2011 in part because a lack of policy support gave it no economic way to recover costs by selling its CO2.

 —Thomas W. Overton, JD, gas technology editor (@thomas_overton, @POWERmagazine).