EXECUTIVES BLAME CONGRESS FOR LACK OF CCS PROGRESS

Tamar Hallerman
GHG Monitor
10/19/12

PITTSBURGH—Many executives addressing the International Pittsburgh Coal Conference this week pegged the relative stagnation of the country’s carbon capture and storage industry to the hyper-partisanship that has characterized Congress over the last several years, and few appeared optimistic that things could turn around following the November elections.

Many of the speakers that addressed the audience here recognized the need for Congress to approve a regulatory regime and adequate incentives to help kick-start the CCS industry, but few seemed confident that the current political climate will be able to pave the way for such cooperation on an issue. “We can’t get off the ground with ‘clean coal’ technology because we lack leadership at the national level,” John Hofmeister, a former Shell Oil president who is now CEO of Citizens for Affordable Energy, said during his keynote address. He attributed that leadership void to “the incredible, awful, sometimes downright revolting perversity of partisanship” that has caused many members of Congress to focus constantly campaigning for reelection rather than aiming to formulate comprehensive energy policy. “Why pass policies that would affect the long-term energy supply when [members always] have an election to work towards?” he said. “Replacing power plants takes decades…building out new nuclear facilities takes a decade or more. But nobody’s worried about a decade because there are [elections every two years].”

Former House Science Committee Chairman Sherwood Boehlert (R-N.Y.) also lamented the “anti-science atmosphere” that he said has permeated Congress in recent years. He added that Congress might have missed its chance to significantly boost the CCS industry in 2010 when cap-and-trade legislation faltered in the Senate after narrowly passing the House the year before. “My personal thinking is we’re not going to get a hell of a lot of progress on CCS domestically until we put a price on carbon,” he said, a move he said he is not expecting regardless of which party wins the presidency next month. Boehlert said that given those political realities, which he said “have significantly reduced the prospects for timely development and deployment of commercial scale CCS projects” in the country, he recommends that American companies interested in CCS should instead look to countries like China to invest in R&D and deployment projects.

CCS Development Not as Far Along as Many Have Hoped

In their keynotes, both Boehlert and Hofmeister lamented that despite having bipartisan support, CCS is not as far along in 2012 as many had hoped it would be several years ago. In its two most recent status reports on the industry, the Global CCS Institute has reported a largely flat number of projects under development globally. Meanwhile, the Congressional Budget Office said this summer that the $6.9 billion in federal funding that has been spent to date on CCS is unlikely to help advance the widespread deployment of the technology unless the federal government enacts other policies to incentivize utilities to limit greenhouse gas emissions such as a carbon price. “The private sector would have a greater incentive to invest in CCS technology if the federal government adopted policies that in some way offset the higher cost of generating electricity in coal-fired plants equipped with the technology,” CBO said this summer. However, CBO acknowledged that the option would require more federal investment in a technology that is already considered controversial and where there has already been substantial federal investment as part of the 2009 stimulus bill, making it harder to get the political support to delegate more money to the technology, particularly given the pinched funding climate. Since 2010, most talk about pricing carbon has been dead on arrival in Congress. However, discussions surrounding the possibility of a carbon tax have resurfaced in earnest in recent months.