Vattenfall fires up CO2-free power station

By Chris Bryant in Spremberg, Germany
Published: September 10 2008 03:00

Vattenfall, the Swedish energy group, yesterday fired up a carbon-capture plant in eastern Germany, marking the first step towards a commercially viable coal-fuelled power station that does not emit carbon dioxide.
The 30MW pilot plant is capable of producing electricity from lignite -
so-called brown coal - for only about 25,000 homes but the company says the €70m ($99m) project is an important milestone on the road towards widespread use of carbon-capture technology.
The pilot project is, however, on a very different scale from the power stations that would need to be fitted with carbon-capture and storage technology to make a significant difference to greenhouse gas emissions.
The carbon dioxide produced at Schwarze Pumpe will be transported by tanker to the Altmarkt region in Saxony-Anhalt, where it will be stored in an airtight bore hole.
The carbon capture and storage process, whereby carbon dioxide is separated at the power plant, transported and buried underground - so it will not have to be transported over long distances - has long been seen by the energy industry as a means to make coal a viable climate-friendly fuel, at least in the near-term.
By 2015, Vattenfall aims to build a 500MW plant at Jänschwalde, Brandenburg, but it is by no means the only company researching carbon capture and storage.
Germany's Eon is among the companies to have entered a UK government competition promoting the use of carbon capture technology. Meanwhile, Italy's Enel has committed to spending €320m by 2012 on the technology and is considering a project near Venice.
StatoilHydro, the Norwegian oil company, has been storing carbon dioxide under the North Sea at its Sleipner field for more than 10 years.
However, the experience of BP, the UK oil group, has underscored the complexity of these projects. In May the company abandoned plans for a plant in Australia because it discovered geological problems that made the long-term storage of carbon dioxide unfeasible. The company also pulled out of a similar project last year, at Peterhead in Scotland.
Yet BP has a joint venture with Rio Tinto for two carbon capture projects in California and Abu Dhabi. It has also a tie-up with Statoil and Sonatrach, the Algerian energy group, whereby CO2 is stripped from natural gas and pumped underground.
The €1bn cost of constructing a commercial plant and disagreement about the best technology to use, means that so far only small-scale power-plants have been built. Energy companies
also say the technology will only become economically viable if the price of tradable CO2 emission certificates increases.
Copyright The Financial Times Limited 2008