Tough measures deliver in Scandinavia

It may be vacation time, but I find I am not far away from the world of climate policy – in fact a trip with my son up to Norway by ship gives an excellent perspective on policy measures that are delivering real results.

We started out in Copenhagen, with the main convention centre near the airport already sporting a Vestas wind turbine out the front, presumably in readiness for COP 15 in just a few months time. This turned out to be the first of many that can be seen around Copenhagen and in the near vicinity. Although Denmark still relies on both coal and natural gas for electricity generation, it now also generates more than 6000 GWhrs per annum from 5212 wind turbines (2007), making up nearly 20 % of domestic electricity supply.

Wind, coal and gas are all used in Denmark

Wind, coal and gas are all used in Denmark

A spectacular array of turbines can be seen in Copenhagen harbour and the main shipping channel serving the city. Oddly, the actual number of wind turbines in Denmark is expected to decline in the near term as older small units (< 500 MW) are decommissioned and new large units are built (now up to 4+ GW).

Copenhagen harbour

Copenhagen harbour

This transformation in the energy mix comes through the application of a focussed policy agenda which supports wind energy through a fixed tariff approach. In the process Denmark has built a significant wind industry, employing nearly 30,000 people and delivering export earnings of €5.7 billion per annum.

On to Norway and our ship pretty much sailed along the edge of the Utsira formation, a 400 km long saline aquifer which stretches along the western coast past Bergen. A recent study has estimated that this one formation could be used to store about 40 Gt of CO2, or nearly all the global fossil CO2 emissions for nearly 18 months. Other formations with similar capacity exist in the British sector of the North Sea.

Norway has led the way in carbon dioxide capture and storage (CCS) and some 8 million tonnes of CO2 has been successfully sequestered within the Utsira formation by Statoil Hydro. The CO2 comes from the Sleipner natural gas field where it is removed from the natural gas by amine treatment. Importantly, 12 years of storage experience now exists in this location and there has been no trace of any leakage despite extensive monitoring. The CO2 sits in the formation about 1000 metres below the sea bed, protected by some 800 metres of cap rock.  Today, the north-south extension of the Utsira / Sleipner carbon dioxide plume is about three kilometres long. Over time the CO2 will dissolve in the formation water and sink to the reservoir bottom.

Oil, gas (and now CO2) rigs can be seen in the Norwegian North Sea

Oil, gas (and now CO2) rigs can be seen in the Norwegian North Sea

Getting back to the policy aspect of this, this pioneering CCS project has been underpinned by a long standing CO2 price in the Norwegian offshore sector, delivered by a ~$50 per tonne CO2 tax. Similarly, the EU-ETS and other nascent trading systems are beginning to deliver a CO2 price into the broader developed country markets.

The experience in Scandinavia supports a number of points:

  • That big changes can be made in the energy system over a number of years, provided policy is focussed, long term and that the government stays with it.
  • That CCS is a viable technology that can be delivered on commercial terms provided a suitable CO2 price exists in the market.
  • That CCS is a safe technology, backup up by experience and monitoring for over 10 years.

Both Norway and Britain have their eyes on a large-scale CO2 storage industry. One of the Norwegian maritime schools has even proposed a design for a multi-purpose vessel which could be used for backhaul transport of CO2 to suitable storage locations. In such a service, CO2 transport costs from other Northern European ports to the North Sea could be less than €10 per tonne.

Replicating the achievements of Denmark and Norway is now a priority for many countries. But results will take time and successive governments will need to persist with and build on the foundations put down by their predecessors. On this issue at least, bipartisan politics will need to be the name of the game in the years to come.

Our ship in Geiranger Fjiord at the norther end of the Utsira formation

Our ship in Geiranger Fjiord at the norther end of the Utsira formation