23 March 2009 00:00 [Source: ICB]
E.ON renewed its pressure on the UK government last week to offer more financial incentives for carbon capture and storage (CCS) technology, as it awaits a firm decision on plans to expand its coal-fired Kingsnorth plant and fit it with CCS. The German energy company said that current fossil fuel policy acted as a financial disincentive for generators planning CCS-enabled plants.
Paul Golby, E.ON UK's CEO, said: "Let us complete the technical development of CCS while [the government] funds the difference between abated and unabated fossil."
An E.ON spokeswoman said CCS increased generating costs by about 25%, and the government had to provide financial support to make the investment worthwhile.
She added that if incentives to build and run CCS plants were not put in place, the first generator using CCS would effectively be penalized for doing so.
The spokeswoman likened the development of CCS to the unrolling of flue-gas desulfurization (FGD) equipment, the high price of which fell heavily as soon as more generators applied the technology. She pointed out that incentives and financial support were introduced for FGD, and called for similar support for CCS.
A Department of Energy and Climate Change spokeswoman said that a new consultation was already being planned to assess the high running costs of CCS. But she added that the department had launched its CCS competition - for which the Kingsnorth project has been shortlisted - to help the first commercial developer of carbon capture meet the high costs of development and operation.
E.ON added that it had begun assessing pipeline routes from the Kent coast to transfer the captured carbon from Kingsnorth to North Sea gas fields for storage. The company is also planning to ship the carbon in storage tanks to the fields.
Earlier this year E.ON said the cost of its Kingsnorth 1.6GW expansion had risen by 50% because of planning consent delays.
ENERGY KEY INDICATORS
EU energy firms' pledge will aid power sector consolidation
CEOs from power companies across the 27 EU member states signed a joint declaration last Wednesday pledging to keep climate change, market harmonization and security of supply at the top of their priority list for years to come. Although the 60 CEOs - who published their statement through industry lobby Eurelectric - said nothing fundamentally new, the declaration will help consolidate the European electricity industry around core principles. The declaration, which also referred to €1.8 trillion ($2.5 trillion) in needed investments, was submitted to EU energy commissioner Andris Piebalgs ahead of a European Council, also last week.
Petrochemical weakness tipped to drive up LPG stocks
The collapse of US petrochemical production has driven the country's liquefied petroleum gas (LPG) sellers into exporting roles in 2009 and will push up LPG stocks this year as export opportunities dry up, an industry consultant has said. "In January and February, unusually large amounts of LPG were shipped to Europe, Asia and South America," Purvin & Gertz consultant Walt Hart said at the company's international LPG seminar.
NGL futures outpace plastics
Natural gas liquids (NGL) futures trading was off to a flying start on US commodities exchange NYMEX while downstream plastics futures remained on the starting line, due in part to weak market conditions, NYMEX officials said last week. "Some [NGL] contracts that we knew would take longer to get going are now picking up, and we're getting positive feedback," said Joe Raia, managing director of energy and metals products for CME Group, the holding company for the NYMEX exchange.
For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.
Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.
Sample issue >>
My Account/Renew >>
Register for online access >>
|ICIS Top 100 Chemical Companies|
|Download the listing here >>|