CLANCY YEATES
April 5, 2010
A LOOMING glut in natural gas is raising the possibility that investment in ''clean coal'', often seen as the saviour of our coal and electricity industries, will be put on the back burner.
With ballooning gas supplies and a possible fall in gas prices, a supplier to utilities says investors could shy away from backing carbon capture and storage, which involves burying power station emissions.
Philippe Paelinck, the director of CO2 product at Alstom, a global supplier to utilities, described the gas bubble as the biggest threat to the development of carbon capture in the next five years.
''I think if you look at the main threat to CCS [carbon capture and storage] in the coming five years, it is really gas,'' Mr Paelinck said.
In the past two to three years, global gas reserves have surged because technological advances and increased demand have made unconventional reserves commercially viable. Soaring demand has also increased the world's yearly supply of liquefied natural gas by 50 per cent in the last two years.
In Australia this trend has manifested itself in the coal seam gas boom, which has attracted tens of billions of dollars in investment from the world's oil giants.
''All of a sudden gas becomes a lot more available at an affordable price,'' he said. ''If you have low gas prices, there will be a clear temptation, it's already there, to switch to power generation from gas.''
Alstom produces power generation equipment for both fossil fuel and renewable power stations. It is backing several carbon capture and storage projects in Europe and the US.
In Australia, which generates more than 80 per cent of its power from coal, gas is expected to meet a growing share of electricity generation. Investment in gas plant is expected to be $15 billion in the next decade.
The last two federal governments have talked up the potential of carbon capture as a means of reducing carbon emissions into the atmosphere, but the technology requires hefty subsidies to be economic.
Mr Paelinck said making clean coal viable depended on significant investments in the developed world because emerging nations such as China were not pouring enough funds into the technology.
''If we don't develop CCS because of gas in the US and in Europe, we won't have any CCS in the rest of the world - that's the problem,'' he said.
Clean coal supporters say inadequate financial support now will limit the technology's potential to cut emissions later on. But some environmental groups are sceptical and say the money would be better spent on renewable energy.
Mr Paelinck said the technology was already competitive with some overseas wind farms, but in Australia it was less competitive because the country's geology required more spending on pipelines and infrastructure.
Source: http://www.smh.com.au/business/gas-glut-seen-as-a-threat-to-clean-coal-technology-20100404-rlm3.html
April 5, 2010
A LOOMING glut in natural gas is raising the possibility that investment in ''clean coal'', often seen as the saviour of our coal and electricity industries, will be put on the back burner.
With ballooning gas supplies and a possible fall in gas prices, a supplier to utilities says investors could shy away from backing carbon capture and storage, which involves burying power station emissions.
Philippe Paelinck, the director of CO2 product at Alstom, a global supplier to utilities, described the gas bubble as the biggest threat to the development of carbon capture in the next five years.
''I think if you look at the main threat to CCS [carbon capture and storage] in the coming five years, it is really gas,'' Mr Paelinck said.
In the past two to three years, global gas reserves have surged because technological advances and increased demand have made unconventional reserves commercially viable. Soaring demand has also increased the world's yearly supply of liquefied natural gas by 50 per cent in the last two years.
In Australia this trend has manifested itself in the coal seam gas boom, which has attracted tens of billions of dollars in investment from the world's oil giants.
''All of a sudden gas becomes a lot more available at an affordable price,'' he said. ''If you have low gas prices, there will be a clear temptation, it's already there, to switch to power generation from gas.''
Alstom produces power generation equipment for both fossil fuel and renewable power stations. It is backing several carbon capture and storage projects in Europe and the US.
In Australia, which generates more than 80 per cent of its power from coal, gas is expected to meet a growing share of electricity generation. Investment in gas plant is expected to be $15 billion in the next decade.
The last two federal governments have talked up the potential of carbon capture as a means of reducing carbon emissions into the atmosphere, but the technology requires hefty subsidies to be economic.
Mr Paelinck said making clean coal viable depended on significant investments in the developed world because emerging nations such as China were not pouring enough funds into the technology.
''If we don't develop CCS because of gas in the US and in Europe, we won't have any CCS in the rest of the world - that's the problem,'' he said.
Clean coal supporters say inadequate financial support now will limit the technology's potential to cut emissions later on. But some environmental groups are sceptical and say the money would be better spent on renewable energy.
Mr Paelinck said the technology was already competitive with some overseas wind farms, but in Australia it was less competitive because the country's geology required more spending on pipelines and infrastructure.
Source: http://www.smh.com.au/business/gas-glut-seen-as-a-threat-to-clean-coal-technology-20100404-rlm3.html
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