World Bank plans a fund to help developing nations with CCS

Norway and the World Bank are in discussions over setting up a new trust fund to help developing countries create and deploy carbon capture and storage (CCS) technology.

The fund is still in the planning stages, and World Bank officials declined to discuss it beyond acknowledging "expressions of interest" with an unnamed bilateral donor. Norwegian ministry officials also could not be reached yesterday for comment.

But think tanks, nonprofits and industry groups familiar with the proposal said Norweigan leaders first publicly floated the plan at a Sept. 14 World Bank workshop on CCS needs and concerns in developing nations. At the workshop, Norway announced it will give 35 million kroner (about $6 million) for a World Bank trust fund to help nations develop and deploy the technology.

"We can't move CCS projects forward without financing," said Sarah Forbes, a senior associate at the World Resources Institute think tank. "The World Bank can play a role in moving CCS projects forward broadly, and specifically in developing countries."

The trust fund plans come on the heels of an International Energy Agency report calling for 3,400 CCS plants by midcentury, most of which will need to be sited in developing nations. The study, outlined at a major carbon sequestration conference this week in London, outlines a future in which 97 percent of the growth in greenhouse gas emissions will come from fast-growing nations over the next two decades and makes a strong case for driving the technology forward outside of the United States and Europe.

Details of the fund remain unclear, but those at the meeting and familiar with the fund said they expect the World Bank will fund "capacity building," which could range from technical assistance to helping to finance the development of a specific project.

"Some countries need basic steps of how the technology works. Others need specific collaboration with Western countries," said George Peridas, a science fellow at the Natural Resources Defense Council.


Some green groups remain on red alert

The plans appear certain to raise the ire of other environmental groups that oppose the technology and believe the World Bank should avoid funding fossil fuel projects altogether.

In launching a fund last year for clean technology efforts in developing countries, the World Bank initially eyed using the money to accelerate deployment of CCS. Green groups reacted fiercely, and ultimately, the bank decided that because capturing and storing CO2 underground is not currently a viable technology, it should not be eligible for money through the Clean Technology Fund.

Susanne Breitkopf, who works on World Bank issues for Greenpeace, argued that CCS is an unproven, expensive technology and many countries like India have expressed strong reservations about deploying it. Instead, she said, the multilateral donor institution should focus more on helping countries leapfrog dirty technologies to develop wind, solar and other renewable energy.

"The World Bank is on the wrong track if it pursues the coal and CCS option at this point," Breitkopf said.

Karen Orenstein, spokeswoman for Friends of the Earth, agreed.

"The World Bank should be greening its energy portfolio," she said. "It's difficult to understand why the World Bank or Norway would be pouring money into an unproven technology ... rather than pour money into renewable technologies."

To Norway and IEA experts, CCS is key

According to the International Energy Agency, CCS in the power sector could account for 8 to 10 percent of global greenhouse gas emissions reductions by midcentury. That, the agency found, is particularly true for China and India, which are the largest and third-largest coal users in the world, respectively.

U.S. Energy Secretary Steven Chu this week called on the United States and other countries to make CCS technology affordable and widely deployable within the next eight to 10 years. Yesterday, he announced $55 million to develop advanced technologies that can capture carbon dioxide from flue gases at existing power plants.

At a CCS conference in Bergen, Norway, earlier this year, representatives of the oil-rich Scandanavian nation argued that large-scale and affordable deployment of the still-nascent technology holds the key to increasing energy worldwide while reducing emissions.

Among the published conclusions of the May conference was an understanding that CCS must be accessible to developing countries. It was noted that the World Bank "emphasized their interest to provide financial support for CCS" in countries that express an interest.

Speaking at the Bergen conference, World Bank Vice President for Sustainable Development Katherine Sierra said developing countries increasingly are seeking affordable but also sustainable energy solutions. Reuters quoted her as saying that while the bank traditionally has not funded "pre-commercialized technology" like CCS, it would like to play a bigger role in this arena.

"We are having discussions with a few countries to learn what they are doing [with CCS]," she said. "If there is a request from countries for us to help pull together a financing package we could certainly be interested in discussing it."

Forbes, of WRI, said she understands that CCS funding, particularly via the World Bank, is likely to be a sensitive topic. But she also argued that as energy use grows around the world, it is increasingly critical to solving the global warming problem.

"CCS is about climate change, it's not about fossil fuels," she said. "We have to start thinking about it as a climate change technology."

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