Boundary Dam CCS Project: A critical review

 Last week I introduced the Boundary Dam CCS project. This post will explore some of the issues the pilot project has faced.

Cost - taxpayers subsidising private oil interests?

 Everything discussed in this section is taken from this financial report and analysis of Boundary Dam CCS, from Saskwind. The figure below summarises the findings of the report.

Figure 1: Financial analysis of the Boundary Dam CCS project.

 The report, summarised here in this excellent article by David Roberts, finds:

• The $1.2 billion project budget eventually overran to $1.47 billion.
• $240 million of this was payed for by the Canadian federal government, the other $1.23 billion by Saskpower's electricity customers (via their bills).
• Over the plant's 30 year lifetime:
• The plant will earn $713 million from the sale of CO2 and $391 million from electricity sold.
• If the construction and upkeep costs of the CCS facility are subtracted from this profit, the CCS facility will make a $1,042 million loss overall.
• The total loss for Saskpower's customers equals -$651 million.

 In the meantime, Cenovous Energy, the oil company using the captured CO2 to extract oil from the Weyburn oil field, will net a $1,823 million profit from oil sales. Of this, an estimated $1,000 million will be oil sales made possible by EOR using CO2 from Boundary Dam.

 The upshot? Saskatchewan tax payers subsidise Cenovous Energy's $1 billion profits to the tune of $650 million. I don't know about you, but that doesn't sound like a flagship environmental project to me.

 The alternative? According to this figure from the US Energy Information Administration's 2016 outlook, the cost of Hydro, Wind, Solar PV and Biomass renewable energy sources are all significantly lower than the cost of new CCS coal fired power stations.

Figure 2: Cost of different electricity sources.

 Saskwind's report states that wind power (Saskatchewan is Canada's windiest province) could provide an equivalent amount of electricity over 30 years for just $450 million. That's a whole $1 billion less than the Boundary Dam CCS project.

Environmental Concerns

Probably the most fundamental component of a CCS facility is that it does what it says on the tin: captures carbon. Upon construction, Saskpower hailed that the Boundary Dam CCS project would capture 1 million tonnes of CO2 per year. However, in this September 2015 press release Saskpower stated that Boundary Dam had captured just 400,000 tonnes of CO2 in its first year of operation, less than half their target.

 Stephan Melzer noted in his 2012 report on CO2 EOR that NUMBYISM (not under my backyard) was one of the major barriers to CCS development. He cited concerns about industrial subsurface storage, general mistrust of large industry and pollution. So how does Boundary Dam CCS compare to a 'normal' power station?

 In this 2016 paper by Koiwanit, J., et al the effect of CCS upon atmospheric NOx and SO2 pollutants was studied. Reductions in NOx and SO2 emissions were observed at CCS sites. It was found that reductions in SO2 and NOx pollutants contribute to reductions in acute respiratory problems such as asthma. However, the post-combustion CO2 capture technique used at Boundary Dam was found to be much less effective at reducing atmospheric contaminants than oxy-fuel capture technologies.

Conclusions

 Teething problems can be expected, but the suspect financial setup and poor CO2 capture record of Boundary Dam borders on the ridiculous. In terms of atmospheric pollutant reduction, Boundary Dam has been successful, but it is a small battle won in a very large war. To the residents of Saskatchewan, the Boundary Dam CCS project appears something of a white elephant. To Cenovous Energy? A piggy bank.