Vattenfall AB (Vattenfall) has set a goal of making its power generation carbon-neutral by 2050. Vattenfall, at present, gets 22% of its electricity from renewable sources, mainly hydropower and offshore wind in Sweden. 31% is generated from nuclear energy. It intends to reduce its carbon emissions by 3% from 2008 to 2010. Vattenfall expects to cut emissions by 50% from 1990 levels by 2030 from offshore wind, ocean power, biomass, new nuclear power, and carbon storage at fossil fuel plants.
The company has worked with McKinsey & Company (McKinsey) on a study that examines carbon dioxide’s concentrations reducing technologies in the atmosphere.
Vattenfall Chief Executive Officer Josefsson said that the McKinsey study found that the cost of emissions abatement by 2030 is about half of 1% of global gross domestic product. That is about as much money as a $10 change in the price of oil, which the global economy has shown it can absorb, he said.
Clean coal technology has been found to be one such technology capable of stabilizing carbon dioxide concentrations at 450 parts per million. The current concentration is approaching 400 parts per million and was under 300 parts per million before industrialization the Massachusetts Institute of Technology (MIT) President Susan Hockfield said.
Sequestering carbon is part of of an economywide transformation that will need to happen to stabilize greenhouse gas concentrations Josefsson said. If businesses and policy makers wait 10 years to pursue low-carbon technologies, achieving the 450 parts per million target will not be possible, he said.
This is not a small correction. It’s a total redesign of society and the way it’s been. It’s a totally new infrastructure and for that, you need time, Josefsson said. We think in 40 years, we can change everything as a power company–it’s a question of how and in what order.
In Germany, Vattenfall has found that the oxyfuel technology being tested can effectively cut carbon dioxide emissions by 100% by pumping gases underground through pipelines. But it’s not clear that this can ever be done economically, Josefsson said.
Josefsson further argued that the cost of developing carbon storage technology should be shared by government and industry.
Companies with shareholders and boards cannot take such a loss to get a gain in 20 years. This is a perfect example of a public-private partnership, Josefsson said. Things will not happen by themselves in the time required if we don’t get that match between industry and government.
In the US, there are no carbon-capture facilities functioning. The Department of Energy gave funding for a research project in Illinois called FutureGen in 2008. At present, in stimulus plan and budget, $3.4 billion has been set aside for research in low-carbon coal technologies, such as carbon storage at coal power plants.
To address climate change, the world’s economies need policies that manage the cost and speed of change to low-carbon technologies, Josefsson said. The need for a carbon cap-and-trade system designed to put a price on emitting carbon dioxide was stressed by Josefsson.