Energy Commissioner Andris Piebalgs last week welcomed a report published by McKinsey & Company entitled ‘CCS: Assessing the Economics’.

After the presentation he stated that ‘early effective demonstration of technological viability of Carbon Capture and Storage (CCS) in power generation, both in Europe and internationally, is essential to move rapidly to economically viable, near free carbon electricity generation. This report is a valuable contribution to the discussions currently ongoing to find the best way to push this technology forward".

As part of its January 2008 climate and energy package, to stimulate development of CCS in Europe, the Commission proposed an enabling regulatory framework which could incorporate a link to the Emissions Trading Scheme (ETS) for demonstration funding purposes. The revised Community guidelines on state aid for environmental protection take a favourable view on CCS and indicate the legal grounds on which CCS demonstration projects can benefit from state aid. The Commission will, in the second half of 2008 propose a revision of TEN-E guidelines to encompass CO2 infrastructure.

In the framework of the SET Plan, the Commission proposes to launch a European Industrial Initiative on CCS as a base for the coordination, transparency and visibility of demonstration projects. This way, EU will take lead in large-scale demonstration world-wide and will maximize the benefits of early demonstration.