Denmark awards cement producers $2.6 billion to carbon capture and storage

Aalborg-Portland, the largest emitter of carbon dioxide (CO2) in Denmark, signed on Tuesday a contract for 16.5 billion crowns (2.55 billion dollars) worth of subsidies to be paid by 2030.

Denmark has set one of the most ambitious goals in the world for greenhouse gas reduction. It aims to reduce emissions by 70% compared to 1990 levels. The CCS project will be key to cutting CO2 from difficult-to-abate sectors such as cement.

Aalborg Portland CEO Soren Christensen stated in a?statement that "we can now take the definitive step towards realising a project?that is?not only significant in the Danish context?but is also one of the largest industrial CO2?capture projects?in Europe."

The traditional cement industry is responsible for 8% of the global CO2 emissions. This includes the amount of CO2 generated by the coal that heats kilns and the limestone being converted into clinker.

Aalborg-Portland will receive 875 crowns for each ton of CO2, which is equivalent to?1.1 billion crowns per year over 15 years. The subsidies cover the capture, transportation and storage of up 1.25 million tonnes of CO2 per annum.

The company said it expected the project to account for more than 50% of the Danish CCS Subsidy Pool's overall goal of capturing 2.3 millions tons of CO2 per year from 2029.

Aalborg Portland announced that Air Liquide will provide the technology to capture the gas, while Harbour Energy would provide the infrastructure for transport and storage.

The International Energy Agency (IEA) says that CCS technology can play an important role in achieving climate goals. However, critics question its commercial viability. They also claim it could prolong the use fossil fuels. $1 = 6.4795 Danish crowns (Reporting and editing by Terje Solsvik).

(source: Reuters)