14 April 2023
You would have to have missed the last three decades not to understand the threat that rising CO2 levels pose to our planet today. Of course, scientists have warned us about this for years, but still, each year, we pump billions of tonnes of carbon dioxide into the atmosphere with almost no activity to remove this harmful gas.
Recently, there has been renewed interest from the biogas sector in the capture of CO2. For example, at the World Biogas exhibition in March, there were numerous technology providers selling carbon capture solutions. Some of these technologies have been available for a number of years, but few units have been deployed – so what has changed to suddenly ignite such interest in carbon capture?
Most importantly, operators have now identified how carbon capture can be monetised. This was stimulated initially by the collapse of the UK’s foremost producers of CO2, who produced CO2 as a by-product of fertiliser production. Those on the forefront could command a significant premium for carbon dioxide derived biogas. Even the quality conscious food and drinks sector opened up to the possibilities of CO2 from biogas. This stimulated interest from potential producers and consumers of CO2 to investigate supply from more environmentally sustainable sources.
The food and drinks sector is a finite market, but others are looking to longer-term uses of CO2. After all it makes sense to extract CO2 from concentrations of around 50% biogas production when the alternative is trying to extract it from the air, which has a concentration of approximately 0.04%.
Much is being made of sequestration of CO2 under the North Sea. If the economics of this can be made to work, the dry oil and gas fields of the North Sea could provide an enormous outlet for CO2. However, this model relies on a carbon credit market and offsetting credits, which can be opaque and seen as risky and uncertain. Whilst some operators are pursuing this market, additional underpinning of the market by government would help accelerate rollout.
Others are looking carefully at how CO2 would be needed to produce bioethanol and other equivalent products. Many industries, such as airlines, are now being mandated to use a certain amount of bio derived fuels and CO2 is required to make almost all of the alternatives.
What is clear is the market for CO2 is opening up. Whether to replace CO2 production with more environmentally sustainable product methods, or looking to supply more environmentally sustainable fuels, the market has plenty of opportunities.
With small scale technology CO2 extraction technologies are getting better and less costly. Many operators are deploying CO2 capture systems. But the market still has uncertainty so many are taking a considerable market risk. However, there is an underlying feeling that the market will launch, and it is simply the right thing to do. It is not just the biogas sector now betting on carbon capture, in April, British Petroleum (BP) announced it was taking a 40% stake in Harbour Energy which has a number of carbon capture storage projects under the North Sea.