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Large-scale deployment of CCS will underpin new low emissions industries (including hydrogen) and provide a potential decarbonisation pathway for hard-to-abate industries such as natural gas processing and cement.

CCS currently offers strong potential where a facility produces a pure and high pressure CO₂ stream, as this negates the need for capture technology.

Such processes include oil and gas extraction, natural gas processing, and coal gasification or methane reforming for hydrogen production. Australia has a comparative advantage in CO₂ transport and storage, with a number of sources of CO₂ located close to suitable geological storage basins and with established pipeline easements between the two.

Australian CCS projects could also play an important long-term role in storing CO₂ drawn down from the atmosphere, likely to be crucial in global efforts to meet the Paris Agreement’s temperature goals.

Setting the stretch goal

Achieving a stretch goal of under $20 per tonne for CO₂ compression, hub transport (in the vicinity of 100 km) and storage would position CCS to be competitive over the long term with other forms of abatement supported by the Emissions Reduction Fund.

The stretch goal covers CO₂ compression, hub transport and storage, but does not cover capture processes, noting the cost of capture technologies varies between applications and depends on factors such as the relative concentration of CO₂ produced by an industrial process.

Collaboration and partnerships between governments, industries and communities will be necessary to enable large-scale CCS development and deployment in Australia. Governments play a role through investments in research, development and demonstration and by providing targeted incentives for technology adoption. CCS hubs and shared pipeline and storage infrastructure could provide pathways to scale and lower costs, and enable emissions to be safely stored from a range of sources including hydrogen production, power generation, gas and oil production, and hard-to-abate industrial processes.

Our investments

The Australian Government has begun work on a new method for CCS to incentivise adoption through the Emissions Reduction Fund. Recommendations of the King Review, such as below-baseline crediting under the Safeguard Mechanism and a technology neutral remit for ARENA and the CEFC, will also encourage technology development and adoption in industry. Establishing CCS as a priority technology and working towards this stretch goal will build on and reinforce these commitments, and accelerate the development of this critical technology as a potential decarbonisation pathway for key industries.

CCS is a critical factor in de‑carbonising industry and in the development and scale-up of the hydrogen industry.

Hydrogen Energy Supply Chain Project Partners