Generating electricity by burning coal or gas and pumping the emissions underground is likely to cost at least six times more than electricity generated from wind power with battery storage, new analysis has found.
The analysis, by Associate Professor Bruce Mountain of the Victoria Energy Policy Centre at Victoria University, finds adding carbon capture and storage (CCS) – a key aspect of the federal government’s technology roadmap – to electricity generation would:
- More than double the capital outlay for coal-fired power stations.
- Cost even more for gas generators than coal generators.
- Increase the cost of electricity by between $90 and $125 per megawatt hour.
“Our analysis suggests carbon capture and storage is likely to cost at least six times as much as wind generation plus storage, with comparable dispatchability,” said Associate Professor Bruce Mountain.
“Making accurate cost estimates is not easy, as there are only two commercial-scale electricity generation projects using capture and storage in the world. One of those has already been mothballed and the second operates far below its design capacity.
“There are other examples of carbon capture and storage in the oil extraction industry, but these are not dealing with emissions from electricity generation.
“New technologies may reduce capture costs in future, but none of these technologies appear to be anywhere close to commercialisation.”
Suzanne Harter, climate change campaigner at the Australian Conservation Foundation, which commissioned the analysis, said CCS was costly and unproven at scale.
“Carbon capture faces huge technological and geological challenges, it does not cut emissions to the levels required to tackle climate change and is so expensive it can’t compete with cheaper and more effective renewable technologies,” Ms Harter said.
“Minister Angus Taylor must not repurpose the Australian Renewable Energy Agency (ARENA) and the Clean Energy Finance Corporation (CEFC) to add costly, unproven carbon capture and storage to their investment mandates.”