Position Paper the Future of CCS in Germany

Introduction

Carbon capture and storage (CCS) technology is expected to play an important role in facilitating Germany's low-carbon ambitions over the coming years. However, by the time it takes CCS to reach technological maturity, German renewables can be expected to have major cost advantages over the newcomer technology.

Scope

• A concise review of the German draft CCS act, adopted by the German Federal Cabinet in April 2009.
• Five years worth of German global power output data across the entire power generation technology spectrum (conventional and mainstream renewables).
• German power supply and demand data (both current and forecast to 2012) coupled to a high level estimate of power imports, exports and losses.
• Reasons why CCS will not threaten the development of existing and future significant renewable energy capabilities in Germany.

Highlights

The draft German CCS act is a necessary yet insufficient condition to drive the widescale development of CCS in Germany. The proposed regulatory framework approach does put certain liability questions to rest but fails to provide the CCS investment community with the necessary reassurances by relying on the European carbon market to fund CCS.

The current political and energy landscape in Germany - a country which depends on coal for about half of its electricity needs - provides the ideal platform for the development of CCS. CCS will take root as part of the country's challenge to replace a significant proportion of power generation in the coming years.

Germany's climate protection strategy focuses on the increased use of renewable power and higher levels of energy efficiency. CCS will not threaten the development of existing and future renewable energy assets in Germany and can instead play a role in reducing CO2 emissions from widespread fossil fuel power generation.

Reasons to Purchase

• Quickly determine and assimilate the most critical developments and issues that challenge and promote the development of CCS in Germany.
• Benchmark the relative appeal of CCS against other forms of renewable power generation in the wider context of Germany's dynamic energy landscape.
• Tailor your strategy having assessed how German CCS will be impacted by technology maturity, policy incentives and the wider German energy landscape.

Table of Contents :

DATAMONITOR VIEW 1
CATALYST 1
SUMMARY 1
METHODOLOGY 1
ANALYSIS 2
CCS is a key component in Germany's effort to overcome security of supply and long-term climate change concerns 2
In April 2009, the German Federal Cabinet adopted the CCS act-a necessary yet insufficient condition to drive the uptake of CCS 2
The current political and energy landscape in Germany provides the ideal platform for the development of CCS 3
CCS will take root as part of the country's challenge to replace a significant proportion of power generation in the coming years 4
Germany's climate protection strategy focuses on the increased use of renewable power and higher levels of energy efficiency 5
CCS will not threaten the development of existing and future significant renewable energy capabilities in Germany 6
APPENDIX 7
Ask the analyst 7
Datamonitor consulting 7
Disclaimer 7

List of Figures 
Figure 1: There is a very strong case for CCS in a country which depends on coal for about half of its electricity needs 3
Figure 2: Phasing out of nuclear means Germany faces an energy supply gap, despite major renewable capacity additions 4
Figure 3: Renewable power generation has seen remarkable growth since 1997, albeit from a low installed base 5