Despite the growing interest in carbon capture and storage technology in Southeast Asia, the future prospects remain uncertain, in the absence of supporting factors, especially in electricity generation.
According to a recent report from the Institute for Energy Economics and Financial Analysis, large-scale adoption of carbon capture and storage in Southeast Asia remains unlikely in the foreseeable future, with no government funding and market drivers, and few carbon emissions limits.
CCS can only be adopted in Southeast Asia in a high carbon price environment with strict emissions regulation, says Putra Adiguna, an analyst with the Institute of Energy Economics, but there is no carbon pricing in the region except for Singapore.
Carbon Capture Uses
There are 3 uses for carbon capture and storage, which currently dominate discussions in Southeast Asia: gas processing and technology-based industries for hydrogen and ammonia exports, as well as potential future use in the electricity sector.
The current global carbon capture and storage capacity is 40 million tons per year, of which 70% is used in the oil and gas production sector.
In Southeast Asia, 75% of CCS projects are used to process gas during production.
Overall, more than 60% of the world’s current carbon capture capacity is used for gas processing, not electricity generation.
Carbon sequestration in the electricity sector
in general, The costs of carbon capture, storage and use on a large scale range from less than $50 to more than $100 per ton.
When talking about the use of carbon capture and storage in power plants, Adigona sees cost still being an obstacle, pointing out that claims about the continuing decline in costs are not true.
According to the report, the cost of using carbon capture and storage technology in a 240 megawatt coal power plant amounted to $1 billion in 2017.
The analyst proved the correctness of his words by closing the only project to capture and store carbon in a power plant in the United States in 2021, for economic reasons, after only 3 years of operation.
The US government has spent at least $1.1 billion to support carbon capture and storage in electricity and industry, but none of the electricity generation projects are in operation yet, and the European Union has spent 424 million euros ($245 million), but it has not Makes the desired progress.
In view of this, it is unlikely that most Southeast Asian governments will assume such a prominent role in supporting CCS developments.
Even the potential leaders in CCS, China, Japan, and South Korea, still have a lot to catch up.
Adigona believes that a careful assessment of the full cost of carbon capture and storage over the life cycle of the project is necessary.
This helps assess the feasibility of using this technology, especially in cost-sensitive markets, and it should be used in sectors from which it is difficult to reduce emissions, taking into account the adoption of other low-cost options from renewable energy sources, according to the report.
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