Don Valley CCS Project,
South Yorkshire, UK
2Co is helping the UK cut its emissions by making carbon capture, use and storage a reality through development of its Don Valley CCS Project.
One of Europe's most advanced CCS projects
2Co's Don Valley CCS Project is one of the most advanced full chain carbon capture and storage projects in Europe.
The project currently leads the European Commission rankings for all European CCS projects, and ranks in Bloomberg New Energy Finance's top ten global CCS projects. The Don Valley project was awarded €180 million of EU funding in 2010 and planning permission was awarded in 2009. National Grid is currently permitting a pipeline to take the CO2 offshore to North Sea storage sites. The project currently expects to be operational by the end of 2016 and at a total cost of up to £5 billion would represent a major investment in UK infrastructure.
As one of the first commercial-scale end-to-end CCS projects in the world, the Don Valley CCS Project would position the UK at the forefront of the global CCS industry and create an international centre of expertise, with significant export opportunities.
World-class knowledge & expertise
The 2Co project team has unparalleled commercial and technical experience in carbon capture, utilisation and storage technologies needed across the full project chain. Shell, BOC/Linde and GE are key technology suppliers to the Don Valley CCS Project. The technologies they will use have been tested and proven at scale around the world. Samsung C&T and BOC have both recently agreed to take significant equity stakes in 2Co’s onshore plant.
Reliable low carbon power generation at the lowest cost
The Don Valley CCS Project in South Yorkshire will use pre-combustion carbon dioxide (CO2) capture technology at a new-build integrated gasification combined cycle (IGCC) power plant.
The plant design includes CO2 capture from a coal gasification plant which will supply hydrogen-rich gas for power generation from which the principal emission is water vapour. This will generate 920 MW (gross) - approximately 650MW (net) - of incremental base-load low carbon electricity from the end of 2016, just as the retirement of existing power plants makes the UK’s electricity supply/demand balance a significant issue. The plant will generate enough low carbon electricity to power one million UK homes, making it the UK's largest CCS project.
From the outset, the CCS plant will capture at least 90% of the carbon in the coal as CO2 (up to 5 million tonnes of CO2 per year) and equivalent to taking over 2 million family cars off the road: a significant boost to the UK’s 2020 emissions reduction targets. The captured gas will be compressed and transported via a 400km National Grid pipeline to permanent storage locations 3km under the North Sea.
'No Cost' North Sea storage
2Co is working with Talisman on two of its Central North Sea oil fields which it plans to use for permanent CO2 storage. The North Sea oil fields under consideration are approaching the end of their life, and would otherwise be decommissioned at substantial cost to HM Treasury.
2Co Energy proposes to inject the captured CO2 into these oil fields where it will be a valuable commodity for producing otherwise 'hard to reach' oil from depleted oil fields and increasing yields by up to 15 per cent of the oil originally in place. Naturally occurring CO2 has been used to extract oil in North America for 40 years and today accounts for six per cent of domestic oil production - some 300,000 barrels a day. The availability of man-made CO2 from carbon capture projects will enable this industry to develop in the UK too.
Not only are oil fields the best geological storage sites, but using CO2 for Enhanced Oil Recovery (EOR) boosts the economic viability of the Don Valley CCS Project and importantly reduces the amount of government support required. With the use of EOR, 2Co's current projections estimate that Don Valley, and other heavy emitting industry, will be able to safely and permanently store their captured CO2 at zero cost.
By creating a commercial use for the captured CO2, rather than treating it as purely a waste product, could generate billions of oil production taxation revenue for government. This game-changing EOR technology will significantly offset the high initial infrastructure and storage costs that have hampered UK CCS development in the past and makes CCS cost-competitive with other low carbon sources of electricity generation.
If CO2-EOR is widely deployed, experts believe that an additional 3-8 billion barrels of oil could be extracted from the UK North Sea, potentially doubling the UK’s remaining recoverable oil reserves, and extending the life of the North Sea oil industry by 20 years or more.
2Co is currently working with the Scottish Government, Scottish Enterprise and the Scottish CCS to assess the full potential for CO2-EOR in the North Sea.
Best place to create a world-class CCS cluster and low carbon industrial zone
Unique geographic and industrial assets make the Yorkshire-Humber region best-placed to become a world-leading CCS location. It is not only within easy reach of offshore CO2 storage sites in the North Sea but the region also represents the heart of the UK's coal-fired power generation emitting 90mt CO2 per year - almost one fifth of the UK's annual CO2 emissions.
Due to its strategic geographical location and the economies of scale derived from an infrastructure pipeline and 'no cost' storage, the Don Valley Power Project will spark a major cluster of CCS projects in the Yorkshire / Humber region.
A "plug and play" transport and storage infrastructure would create one of Europe's most dynamic low carbon industrial zones and see the region become a magnet for heavy emitters looking to reduce their emissions at least cost. 2Co are optimistic that a sustainable UK CCS industry will result that can be exported around the world.
Public Private Financing
Project construction will be funded by government grants, debt, and equity investment from project owners.
Over £3 billion will be invested at the CCS plant site, £1 billion in offshore facilities, and hundreds of millions of pounds into the 400km pipeline. Total investment in the Don Valley CCS project is expected to be £5 billion.
The Don Valley CCS Project is the only UK CCS project to have already won funding (€180 million) under the European Energy Programme for Recovery (EEPR). It is currently competing for additional funding under the EU’s New Entrant Reserve programme (NER300) and is a bidder for the UK government’s CCS development programme in 2012.
Assuming it is successful in these competitions, 2Co will work with the project's public and private investors to reach a final investment decision at the end of 2013 so the plant can be in operation by the end of 2016.
Economic benefits to the UK
The project represents up to £5 billion of capital investment into UK infrastructure. Over the next five years, the project will create up to 3,800 construction jobs in parts of the UK that need them most, such as Yorkshire and Scotland.
The onshore part of the project in South Yorkshire could create around 3,000 jobs at peak construction, and directly create around 300 new jobs once the plant is operational.
The offshore part of the project could create 800 North Sea jobs during construction and sustain 300 highly skilled and well-paid jobs once in operation.
The leadership the UK is showing in CCS combined with the need to see the technology deployed globally, will help create a UK centre of expertise and skills that can be exported around the world. HM Treasury will receive substantial oil taxation revenues that it would otherwise not receive and its share of the costs of decommissioning the oil platforms concerned will be deferred for 25 years or so.
CCS is essential to meeting UK's climate and energy objectives
Early development of commercial scale carbon capture and storage (CCS) projects is critical to the UK's ability to meet its climate change and energy security objectives by 2030 and beyond. 2Co has welcomed the UK government's sustained commitment to a CCS commercialisation programme.
The UK's independent Committee on Climate Change says CCS technologies are essential and urgently needed to decarbonize the UK's coal-fired power sector and carbon-intensive industrial sectors like cement and steel.
Over the next few decades, CCS will be vital to achieving the UK's carbon emissions reduction targets with minimal economic impact by allowing fossil fuels like coal and natural gas to remain part of the future energy mix. The International Energy Agency (IEA) estimate widespread deployment of CCS technology can contribute 20 per cent of the global carbon dioxide emissions reductions needed by 2050 and argue this would cost 70 per cent more without CCS.
The Don Valley CCS Project can make a significant contribution to meeting the UK's need for 'base-load' low-carbon electricity to support development of more renewable energy and at a cost that is competitive with established renewable sources of energy.