The Senate finally passed the $700 billion bailout package today after significant modifications were made to the original 3-page proposal submitted by Henry Paulson (the final version is 451 pages long). The bill has large sections devoted to providing tax credits for companies investing in carbon capture and sequestration technologies. A local PDF copy of the bill is available here. I definitely do not consider myself capable of understanding Federal regulatory material and will wait for the experts to analyze the document line by line. But from what I could understand, section 45Q of the document provides a tax credit of US$20 per ton of carbon dioxide that is stored in geological formations and US$10 per ton of carbon dioxide buried for EOR purposes. These figures are to be compared with the IPCC estimates of US$30-71 per ton of CO₂ for pulverized coal plants and US$14-53 per ton of CO₂ for plants using Integrated Gasification Combined Cycle technologies (source: Table TS.10 of the IPCC Special Report on Carbon Capture and Sequestration).

Speaking at a Clinton Global Initiative gathering, Nobel Prize winner and former Vice President of the US Al Gore urged a Gandhian style Civil Disobedience to stop new coal plants which do not have CCS capabilities. Mr. Gore said:

“If you’re a young person looking at the future of this planet and looking at what is being done right now, and not done, I believe we have reached the stage where it is time for civil disobedience to prevent the construction of new coal plants that do not have carbon capture and sequestration,”

While there is still significant amount of active research in the area, the industry has been reluctant to implement CCS technologies due to the high capital costs as well as higher costs to consumer. For instance for a pulverized coal plant, the cost of electricity with CCS is expected to increase by 43-91% whereas for an IGCC (Integrated Gasification Combined Cycle) plant the increase is in the range of 21-78% (source: IPCC Special Report on Carbon Capture and Sequestration, Table TS.10). Such an approach still requires strong incentives on part of the government to become commercially feasible. While Mr. Gore was not clear on what action he expected, I believe it is a demand that concerned citizens put pressure on their representatives towards passing legislation in this regard. In any case, I am sure that we will be hearing more about this in the near future.

The Alberta Saline Aquifer Project (ASAP) has awarded five major contracts to explore geologic sequestration of carbon dioxide in saline aquifers. The contracts were awarded to Norwest Engineering, Schlumberger Carbon Services, Colt WorleyParsons, Hatch Energy and Oxand Canada. The ASAP is an industry initiative of 35 large organizations collaborating to gain a better understanding of geological sequestration.

MWH is partnering with Schlumberger in a new project to understand the risks associated with geological sequestration of carbon dioxide on groundwater sources. The official press release claims that the project was spurred by the recent EPA draft regulation on underground injection of carbon dioxide.The project goals, as reported in the press release are:

The research project involves a literature search and review of both published and unpublished “gray” literature, the syntheses of the available information, and production of a preliminary report identifying the potential impacts of Carbon Capture and Storage (CCS) technology on the quality of groundwater supplies. MWH will then develop a set of guidelines describing the critical parameters that need to be monitored, along with the frequency and length of the monitoring. Finally, MWH will host and facilitate a stakeholder meeting to discuss the rules’ implications and identify the research gaps in the available data or knowledge base.