August 14, 2020 Read More →

CCS projects likely to become uneconomical because of market volatility

Karma:

NRG Energy Inc.’s shutdown of the only operational carbon capture storage (CCS) plant in the U.S., due to collapsing oil prices, throws into question the viability of such ventures considered key to reducing carbon emissions and fighting climate change, energy experts say.

The Petra Nova CCS plant, meant to capture greenhouse gases from a coal power plant in Richmond, Texas, was an ambitious $1 billion project between NRG and Japan’s JX Nippon. 

NRG closed the plant in May citing falling oil prices and the COVID-19-induced economic downturn which rendered the project not viable.

A post-mortem report from the Institute for Energy Economics and Financial Analysis says there were early warning signs about the viability of Petra Nova and urges investors to scrutinize all future CCS projects.

“There are market forces undercutting the claims that carbon capture is financially viable,” David Schlissel, the director of resource planning analysis for IEEFA, told Karma. “Instead of spending billions to retrofit old coal plants, [it would be cheaper] to expand the wind production tax credit, extend the solar investment tax credit and use renewables as a transition.”

[Neanda Salvaterra]

More: Failed Carbon Capture Storage Project Spells Trouble for Future Ventures, Say Experts

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