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Carbon capture path for thermal plants still elusive

23 October 2024

 

The decarbonisation path for upcoming thermal power plants across the GCC region remains vague, according to industry sources.

Both clients and utility developers are understood to be exploring options to include carbon capture, utilisation and storage (CCUS) provisions in ongoing and upcoming tenders for developing gas-fired power plants in line with their net-zero carbon emissions targets.

Two sources said several independent power projects (IPPs) in Abu Dhabi and Saudi Arabia, as well as independent water and power projects (IWPPs) in Qatar and Kuwait, have considered or are considering available options.

“So far, the only option at the table appears to be that the offtaker and the project company implementing the scheme agree to achieve decarbonisation of a power plant asset at a specific time, mainly by 2049,” one of the sources said. “If not, the international developer reserves its right to leave the project company.”

Most European and Japanese utility developers and investors aim to achieve net-zero carbon emissions between 2045 and 2050. 

Regional utilities and offtakers such as Abu Dhabi’s Emirates Water & Electricity Company (Ewec), Saudi Power Procurement Company (SPPC), Qatar’s General Electricity & Water Corporation (Kahramaa), Kuwait’s Ministry of Electricity, Water & Renewable Energy (Mewre) and Bahrain’s Electricity & Water Authority (Ewa) have either thermal IWPP or IPP schemes that are under tender or about to be awarded.

These entities have specified parameters related to carbon capture or CCUS in their recent and upcoming tenders.

Commercial viability

Introducing CCUS in utility assets, particularly for combined-cycle gas-turbine plants (CCGTs), is becoming a high priority for both offtakers and developers. However, there is less certainty on how and when integrating the solution will become commercially viable.

In a recent interview with MEED, Tomaz Guadagnin, Engie’s managing director for Flex Gen in Asia, Middle East and Africa, said building a power station with CCUS today requires significantly bigger land and capital expense as the asset will require additional gas turbine exhaust systems, among other things.

As such, “it is an important requirement that predictability of the operation of that product is provided”.

Guadagnin says it is key for international developers to consider that these factors need to be built into the tariffs so that companies can reach a financial investment decision.

It is also imperative that developers and offtakers understand what will be done with the captured carbon dioxide.

“What will be done with the captured CO2, where does it fit in, how is it transported and the work required around that and its utilisation. We still don’t have clear visibility on how these will materialise,” the executive noted.

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Jennifer Aguinaldo

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