BELGIUM: April 18, 2008


BRUSSELS - The European Union may boost efforts to capture climate-warming carbon dioxide (CO2) and store it underground by pushing forward proposals for a dozen demonstration projects, EU officials said on Thursday.


Carbon capture and storage (CCS), designed to trap CO2 emissions from power plants and heavy industry, is seen as a possible silver bullet in the fight against climate change, but it has not yet been proven on an industrial scale.

The technology has the capacity to curb global carbon emissions by a third given that it can remove around 90 percent of all carbon from fossil fuel-fired power stations.

The European Commission has proposed legislation to encourage CCS, notably by helping fund up to 12 demonstration plants and by providing a legal and regulatory framework to make geological storage of CO2 possible.

"We may already get agreement on carbon capture and storage under the Slovenian presidency," a presidency official said.

Slovenia holds the rotating European presidency until the end of June after which France takes it over.

"It looks as if everyone is happy with the proposal," the official added, speaking on condition of anonymity.

A European Commission source said CCS could be detached from a package of energy reforms announced in January with the aim of reaching a political agreement in time for a meeting of EU ministers in June.

The proposal has broad backing but agreement is still needed on details such as security measures for the vast pools of CO2 that would be stored underground, added the source.


NEW VENTURE

CCS would improve energy security for many countries by allowing them to continue burning plentiful coal supplies and help cut emissions from countries like China which rely heavily on coal for their electricity.

Industry estimates suggest that the first commercial-scale CCS test plant will be running some time between 2012 and 2015, but the timetable is starting to look vulnerable after recent project cancellations in the United States, Britain and Canada.

European power companies E.ON and Electrabel said on Thursday they were teaming up with Hitachi Power Europe to test clean coal technology on their power plants.

The mobile tester will be able to treat 5,000 cubic metres of flue gas per hour from burnt coal and will be moved from site to site.

European rivals RWE and Vattenfall Europe are also working on projects.

But CCS is expensive and some oil majors like Royal Dutch Shell say government action is needed to support and stimulate investment quickly on a scale large enough to affect global emissions.

Britain and the United States are leading the world in earmarking finance for commercial-scale pilot plants -- about 500 million pounds ($985.2 million) and $1.3 billion to fund one and up to three projects respectively.

Norway has budgeted this year over 1 billion Norwegian crowns ($197.7 million) for research, and China has a full-scale plant slated for 2015.

(Reporting by Pete Harrison; Editing by James Jukwey)


Story by Pete Harrison and Paul Taylor


REUTERS NEWS SERVICE