* Britain’s biggest CCS test plant opens in Scotland
* Technology could cut emissions by 90 percent
* UK hopes to take lead in creating green jobs
By Nina Chestney
RENFREW, Scotland, July 28 (Reuters) - A pilot project in Scotland has begun testing a method of cutting the amount of carbon dioxide released into the atmosphere, which Britain hopes will be a leap forward in the fight against climate change.
Doosan Babcock Energy (034020.KS) switched on its OxyFuel combustion burner, Britain’s largest demonstration project for carbon capture and storage (CCS), on Friday.
More than 100 people from industry, the media and the regional and national governments were invited to witness the event, just outside the city of Glasgow.
“We will supply this technology as soon as the market allows. We are 100 percent confident the demo will work,” Iain Miller, chief executive of Doosan Babcock Energy, told guests.
CCS captures CO2 from power stations and stores it underground to prevent it from entering the atmosphere. It should help European countries meet their joint target of a 20-percent cut in CO2 emissions by 2020 while safeguarding continued operations of coal-to-power industries.
CCS could cut emissions by 90 percent. Several technologies are being tested but none have been proved on a commercial scale yet.
The OxyFuel method burns coal with pure oxygen rather than air, making almost pure CO2 gas and water vapour. This is compressed to trap the CO2, leaving only residual latent gases to be released into the atmosphere.
Doosan Babcock led the 7.5-million-pound ($12 million) project, backed by the British government, Scottish and Southern Energy (SSE.L), and sponsors including Drax (DRX.L), EDF (EDF.PA), E.ON (EONGn.DE), ScottishPower (IBE.MC) and Vattenfall VATN.UL.
Vattenfall has operated a 30-megawatt test facility attached to a power plant in Schwarze Pumpe in Germany since 2008.
Relatively small at 17 metres (56 feet) long, 5.5 metres (18 feet) wide and 5.5 metres (18 feet) tall, the 40-megawatt burner will undergo 20 days’ testing until December at a cost of 10,000 pounds a day. If it works, the technology will be fitted to new or existing coal plants to reduce their emissions.
Britain wants to take the lead on the technology to create green jobs and profit from global business potentially worth 2 billion to 4 billion pounds by 2030. It could also make up ground lost to its European neighbours in renewable energy deployment.
“CCS is our priority. The alternatives are far less attractive,” Joan Ruddock, minister of state for the Department of Energy and Climate Change, told Reuters at the launch.
Big questions remain over how the technology will be paid for on a commercial scale and how carbon dioxide will be transported and stored. CCS is expected to add about $1 billion to the cost of a power station.
To speed up the race to prove CCS, the European Union this year unveiled a 1.05-billion-euro ($1.50 billion) package to support up to seven large-scale projects or parts of between 10 and 12 schemes.
While welcoming the Doosan Babcock project, Barbara Helfferich, spokeswoman for European Environment Commissioner Stavros Dimas, told Reuters the European Union’s goal would be a challenge and demonstration projects required “significant scaling up”.
Britain has done more than any other European country to get CCS off the ground. New coal plants in Britain will have to fit CCS within five years of 2020. The government promised support for up to four 300-to-400 megawatt schemes, with the first operational by 2014.
Experts say the technology can and must be deployed earlier to reap the industrial and environmental benefits.
“I would like to see the government accelerate its time frame and bring forward deployment well before 2020. It can be done,” Miller told Reuters.
Doosan Babcock aims to have a 250-megawatt unit running by 2015 and 1,000-megawatt units by 2020, he added.
E.ON’s CCS project at Kingsnorth, the potential site for a new coal plant, is in the running to win up to 90 million pounds from the government in a competition for a commercial-scale plant. An additional 15 million pounds is available for pilot schemes, from which the Doosan Babcock project received 2.5 million.
Some argue this is not enough, with industry lobbying for subsidies like those given to wind power.
“It is unrealistic to get to 2014 from where we are now. To step up to 300 megawatts requires a different order of magnitude in terms of funding,” said Hannah Chalmers, CCS expert at London’s Imperial College.
The government is pinning its hopes on the recovery of carbon prices in the EU’s emissions trading scheme to drive the technology eventually.
Environmentalists are concerned that CCS will be used to justify the construction of more coal plants, diverting money away from energy efficiency improvements and renewable energy.
There is the problem of transporting and storing the carbon dioxide. The Doosan Babcock burner will not attempt to store CO2 but release it in a diluted, less harmful, form into the atmosphere.
Britain has enough storage capacity for decades in its depleted oil and gas fields and saline aquifers. Countries such as Japan and India have little capacity and would have to export liquid CO2 for burial elsewhere.
For Britain, keeping up the momentum of pilots is key to getting the technology proved.
“The UK would be barmy to lose this opportunity. Slipping behind is just not acceptable,” said Jeff Chapman, chief executive of the CCS Association.