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As stated earlier, I believe in a stick and carrot approach which uses Carbon Taxes combined with Renewable Energy Credits to push industries to adopt carbon mitigation and control, what I call Carbon Storage and Sequestration (CSS); my preferred definition for this CO2 mitigation solution. Most scientists, however talk about CCS (Carbon Capture and Sequestration) which ignores the storage issue; but if you ignore the semantics, scientists are discussing the details of how a storage system would work.

Last month, the Massachusetts Institute of Technology (MIT) released an interdisciplinary study, “ The Future of Coal – Options for a Carbon Constrained World“, which examined: “how the world can continue to use coal, an abundant and inexpensive fuel, in a way that mitigates, instead of worsens, the global warming crisis.”

Their conclusion: “carbon capture and sequestration (CCS) is the critical enabling technology to help reduce CO2 emissions significantly while also allowing coal to meet the world’s pressing energy needs.”

The key findings of the report included:

A significant charge on carbon emissions is needed in the relatively near term to increase the economic attractiveness of new technologies that avoid carbon emissions and specifically to lead to large-scale CCS in the coming decades. We need large-scale demonstration projects of the technical, economic and environmental performance of an integrated CCS system. We should proceed with carbon sequestration projects as soon as possible.

The U.S. government should provide assistance only to coal projects with CO2 capture in order to demonstrate technical, economic and environmental performance.

Congress should remove any expectation that construction of new coal plants without CO2 capture will be “grandfathered” and granted emission allowances in the event of future regulation. This is a perverse incentive to build coal plants without CO2 capture today.

Emissions will be stabilized only through global adherence to CO2 emission constraints. China and India are unlikely to adopt carbon constraints unless the U.S. does so and leads the way in the development of CCS technology.

The report is 192 pages long with an additional 69 pages of Appendices, and those areas which deal specifically with storage systems are: Chapter 4 and Appendix 4.B.

Chapter 4 - Geological Carbon Sequestration, pages 43 - 62, asks all the key questions and starts off by stating:

Importantly there do not appear to be unresolvable open technical issues underlying these questions. Of equal importance, the hurdles to answering these technical questions well appear manageable and surmountable. As such, it appears that geological carbon sequestration is likely to be safe, effective, and competitive with many other options on an economic basis.

The study details all the issues of capacity, assessment, monitoring, plugging, etc. Most importantly it calls for large scale test projects and recommends the Texas/ Louisiana area which has the largest capacity and the best geological infrastructure. Teaxs would also be a good choice because of the concentration of coal fired power plants which are near potential storage sites. President Bush should be happy to send a test project to Texas and it would make it harder for him to object.

Chapter 7 - Public Attitudes Toward Energy, Global Warming, and Carbon Taxes, pages 105 - 110, assesses the public’s attitudes towards taxes as follows:

Policies that produce higher fuel prices have long been thought to be politically infeasible because the public reputedly reacts more negatively to higher fuel prices or taxes than to the threat of global warming.

Carbon taxes, because of their transparency, are thought to be especially unpalatable politically, and public reaction to taxes therefore offers a conservative gauge of support for this line of policy-making.

Based upon four surveys (contained in the appendix), the study found that 50% found global warming to be a top-tier environmental concern, and even those who did not place it in the top two indicated a willingness to pay $16/month, while those who did rank it higher were willing to pay $27/month. It concluded that a $30/ton Carbon Tax would “amount to $13.50 per month on a typical household electric bill.”

Most importantly the surveys indicate a trend in the public attitudes towards accepting “the least popular instrument, taxes. Willingness to pay has grown fifty percent in just 36 months.”

Appendix 4.B states the main problem behind underground sequestration, proper cement plugging of wells at depth to avoid upward migration of CO2 through the bore hole. One major weakness with cement plugs is their susceptibility to carbonic acid, a byproduct of placing CO2 in brine, which will degrade them over time. The rest of this appendix deals with the differences in plugging techniques and the lack of a uniform standard. They conclude by emphasizing: assessment before, during, and after injections; long term monitoring of CO2 at the surface; and allocating funds to replug high risk wells. It mentions storage occurring at depths of 1/4 mile to 1/2 mile.

Here are the key components I believe are required for a successfull underground storage plan which relies upon existing wells:

• The first large scale test facility should be built in Texas and should be started within the next two years, preferably this year.
• A carbon tax of at least $30/ton, preferably $50/ton, should also be implemented. The tax should be phased in, to avoid major economic disruption, starting at $10 and progressing to the maximum within ten years from its start.
• An assessment program; which should begin at the same time that the initial Texas site is selected, that grades existing wells into low, medium, and high risk categories. Emphasis must be placed on establishing facilities at the lowest risk areas first.
• Once established, all facilities must have constant monitoring at ground level; which can be done by automated stations.
• A mechanism to replug those wells which show signs of breaching; which does not rely upon voluntary compliance and which can be enforced rapidly with a simplified court process (similar to a show cause hearing).
• An independent monitoring agency with no industry connections; which is independent in the same manner as the Federal Reserve Bank. At the least it should be part of a Carbon Tax and Credit Agency.
• Funding for this program should come from a combination of Carbon Taxes and a special Carbon Storage credit, and should not be dependent upon any government for revenue.

The technology is available, what we lack is the economic incentives to make a storage system the preferred alternative. Only a stick and carrot approach can work, we can not rely upon credits alone. Carbon Taxes must be set high enough that it becomes prohibitively expensive to continue with current business practices. For those who argue against a high tax I have a new rallying cry - “Remember Sleipner.” Don’t tell me that Norway can do something that we can’t. We have to change the economics of the equation and make CO2 emissions too expensive; only then will we make progress towards wide spread implementation of CO2 storage.

Most importantly of all, we must implement an immediate moratorium on construction of new coal plants until a storage system is implemented; and then restrict construction to new coal plants which agree to be part of this system. Once new plants are online we should start to phase out and retire the worst of the older facilities, using some of the revenue produced from carbon taxes to accomplish this goal through eminent domain.