The Role of Carbon Capture and Storage in the Energy Transition

In this paper, we review and analyze the salient features of the ongoing energy transition from a high to a low carbon economy. Our analysis shows that this transition will require decarbonizing the power, transport, and industry sectors, and the transition pathway will be country-specific. Carbon capture and storage (CCS) technologies will play a major role in this energy transition by decarbonizing existing and new fossil fuel power plants and the production of low-carbon fossil-fuel-based blue hydrogen. Blue hydrogen can be used for hydrogen fuel cell mobility in the transport sector and heat and feedstock in the industry sector. Current estimates show that there is adequate CO2 storage capacity in the world's saline aquifers and oil and gas reservoirs to store 2 centuries of anthropogenic CO2 emission. However, the slow pace of CCS implementation is concerning and is due, in part, to too low of an oil price to make CO2-enhanced oil recovery profitable, lack of financial incentives for CO2 geological storage, low public acceptance, lack of consistent government energy policy and CCS regulations, and high capital investment. We propose several ways to accelerate CCS implementation. Among others, they include establishing regional CCS corridors to make use of economy of scale, public CCS engagement, carbon pricing, and using public-private partnership for financing, technology transfer, and linking up different stakeholders.