German CCS debate heats up as government advances

The debate on carbon capture and storage (CCS) is heating up in Germany, as the federal government finalises its carbon management strategy and environmental groups reiterate their warnings on the associated risks.

Environmental group Greenpeace today slammed Berlin's plan to support CCS technology as part of its nascent carbon management strategy. Greenpeace pointed to the technical risks and high costs, and that Europe's only larger CCS sites — Norway's Sleipner and Snohvit — have already encountered "unexpected" problems.

Germany's federal ministry of economic affairs and climate action stressed in a strategy paper last week that CCS is categorised as safe and "not a high-risk technology". The ministry started consultations last week on its strategy with other relevant ministries, with a draft to be sent to parliament in the next few weeks.

The paper stresses that funding will be available only for dealing with technically unavoidable and "hard-to-abate" emissions, based on a "scoring model" developed by the economy ministry that analyses CCS use based on costs, technological availability, avoidance potential, emission source and lock-in risk.

The cement, lime and thermal waste treatment sectors have been given an "A" score, as their emissions are deemed "technically unavoidable", with steam crackers scoring a "B", allowing these sectors to be considered eligible for support.

Blue hydrogen, the glass industry and gas-based direct reduced iron (DRI) technology in the steel industry are rated "C", and aluminium, gas-fired power plants, combined-heat-and power (CHP) plants, and blast furnace technology in the steel industry are rated "D".

The development of CO2 infrastructure should be "private-sector and market-driven" and "as competitive as possible", the paper said, but some "hedging mechanisms" for investors may be necessary in the "ramp-up" phase to mitigate the risks for first movers and leverage the long-term potential for economies of scale. Support would go beyond Germany's carbon contracts for difference (CCfDs), and possibly imply some kind of state backing via public bank KfW.

CCfDs are among the existing funding instruments planned for certain CCS applications for larger industry firms, along with decarbonisation aid for medium-sized companies presented last month.

The ministry plans to set up a CO2 infrastructure working group to co-ordinate planning, possibly alongside other working groups on areas such as CO2 use or storage.

The annual quantities of CO2 to be sequestered in Germany are estimated at 34mn-73mn t of CO2 in 2045.

Germany's amended draft carbon storage bill, which forms the legal framework for the pipeline-based transport and storage of CO2, is now under parliamentary scrutiny.

And Germany will deal with carbon removal and the targets for "technical sinks" in its long-term strategy on negative emissions, which the government aims to present by the end of this year.

By Chloe Jardine