China to develop first carbon capture project

China’s Shaanxi provincial government is considering a commercial-scale demonstration project using carbon capture and storage (CCS) technology in Yanchang, the first of its kind in the country. 

The Asian Development Bank has agreed to provide a technical assistance grant of $5.5 million to help develop the project under a memorandum of understanding with the National Development and Reform Commission of China, Yanchang Petroleum and Northwest University. 

The project is being developed upon a pilot study started in 2012. The ADB’s assistance will address key barriers to large-scale CCS demonstration by supporting the front-end engineering design of the project, including a feasibility study, environmental and social impact assessments and monitoring. 

The lender said that several potential early demonstration projects, mainly from the coal-chemical industry, had been identified and ranked, with the Yanchang CCS project the closest to ready. Once operational, the project could abate 1 million tons of carbon dioxide every year, equivalent to the annual carbon dioxide emissions produced by nearly 220,000 cars. 

“Large-scale demonstration of CCS in a carbon-intensive economy such as China could be game changing in the country’s management of emissions,” said Ashok Bhargava, director of the ADB’s energy division in the East Asia regional department. 

Carbon-based fuel accounts for more than 85 percent of primary energy supply in China with coal contributing about 70 percent, according to the ADB. As the world’s largest carbon dioxide emitter, the Chinese government is looking to delink its economic growth from carbon-based fuel consumption through energy efficiency measures and the rapid deployment of renewable energy. 

The ADB said CCS is the only available near-commercial technology that could abate up to 90 percent of carbon dioxide emissions in industrial and power plants. However, investment costs for such projects in their initial stage of demonstration is expected to remain high. 

Earlier this month, the Australian government proposed to allow its state-owned green bank, the Clean Energy Finance Corporation, to invest in CCS technologies as a complement to the country’s renewables investments. 

Currently, there are 17 large-scale operating commercial facilities deployed with CCS technology across the world, most of which are in the industrial sector, including in natural gas, fertiliser, hydrogen, iron and steel production.