Annex 2
PROPOSAL FOR EU-CHINA COLLABORATION
NEAR-ZERO
EMISSIONS COAL
WITH CO2 CAPTURE
AND STORAGE
China and the EU already have an Action Plan
on Clean Coal technologies and several Member States have bilateral
activity with China in this area. We recognise that China's near
term priority is to improve efficiency and reduce environmental
impact of coal use, although we are aware of growing Chinese interest
in CO2 capture and storage.
This forms a centrepiece of the EU-China Partnership
on Energy and Climate Security, announced at the EU-China Summit
in September. In the declaration a new initiative on Near-zero
Emissions Coal with CO2 Capture and Storage was proposed.
The co-operation goals included the aim of developing and demonstrating
in China and the EU advanced, near-zero emissions coal technology
through carbon capture and storage by 2020. This will address
the challenge of increasing greenhouse gas emissions from the
use of coal in China—and will provide impetus towards meeting
the medium-term goals of the Partnership.
By 2030, China's CO2 emissions from
coal use will double to more than 5000 Mt CO2/year,
exceeding total European emissions. This is significant in the
context of stabilisation of atmospheric CO2 and mitigating
global climate change. It will be vital to minimise emissions
where coal is used. China is already improving the efficiency
of new plant which is slowing the rate of emissions growth. CO2
capture and storage (CCS) offers the opportunity to reduce emissions
per unit of electricity by 85—90%—"Near-zero
Emissions Coal".
Large scale deployment of CCS in China could
significantly reduce future greenhouse gas emissions. The aim
of the proposed collaboration is to bring forward the time when
new coal plant in China might be built with CCS. It would build
on planned European research and demonstration activity in this
area and will facilitate technology transfer between EU industry
and researchers, and their counterparts in China, opening market
opportunities for Europe. The aim is to assess and demonstrate
CCS in China in parallel with development and demonstration activity
in the UK and Europe.
At present there is limited activity on CCS
in China although there is extensive expertise in clean coal technology
and gasification. The viability and potential for large scale
CCS in China is uncertain, as well as when and where it might
be deployed and how it could be financed. While the country's
geological storage capacity requires further assessment, there
are many sedimentary basins that are expected to contain storage
opportunities, including oilfields with enhanced oil recovery
potential, enhanced coal bed methane and saline aquifer opportunities.
There are a range of emissions sources where CO2 capture
could be envisaged including power plants and other sources, and
there are a range of capture technology options. We envisage an
integrated assessment of CO2 capture and storage opportunities
leading to a demonstration in China.
We propose a collaborative approach that will
be conducted through joint research and development between UK,
European and Chinese partners, involving academic, research institute
and industry partners. A three phased approach is envisaged leading
towards a possible demonstration project starting up between 2010
and 2015.
Usually there are a series of steps towards
major capital projects such as a large demonstration project over
a period of several years. These steps involve both technical,
non-technical and financing activity, separated by major decision
points. We propose a three phase approach, as summarised below.
|
| Phases | Activity
| Timing | Potential Cost
|
|
| 1. Exploring the Options for Zero Emissions Coal (CCS) in China
| Appraise and Select options for Demonstration
| ca 3 Years 2006-2008
| min
4.5 million
5-7.5 million
|
| 2. Define a Demonstration Project
| Define the Option (Engineering, Design and Finance)
| ca 2 Years ? 2009-2010
| 7.5-15 million |
| 3. Construct a Demonstration Project
| Construction stage | 3-4 years, ? 2010-2014
| 35-750 million
[Depending on Option]
|
|
Establishing a collaboration in this area would address a
number of major issues necessary to address climate change, including:
— meeting China's growing energy demand whilst reducing
the impact of coal on the global climate;
— demonstrating the UK and EU's commitment to technology
transfer of climate related technologies
— providing a significant opportunity for UK and EU
industry, placing it in a much stronger position to compete with
US clean coal technology industry.
Phase 1
To demonstrate its commitment to the Partnership, and strong
support for this initiative, the UK (DEFRA/DTI) is proposing to
substantially fund Phase 1 of this project, working with other
Partners as appropriate. We propose that Phase 1 could involve:
— Assessing the viability of Zero Emissions Coal
and Carbon Capture and Storage as a GHG Mitigation Option in China
(technical and economic potential and mapping within the context
of China's energy/coal plans and projected emissions)
— Screening and identifying opportunities for demonstration
and early deployment of CCS in China (including Enhanced Oil Recovery/Coal
Bed Methane, "capture-ready" Plant and options for full
scale demonstration).
— Identifying Opportunities for demonstration and
deployment of CCS in China
— Reviewing Financing Options for Demonstration
and Deployment and evaluating non-technical issues
— Building capacity and awareness of CCS in China
It is anticipated that the Phase 1 duration will be 3 years.
A budget of
4.5-7.5 million is envisaged.
| 
