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IEA GREENHOUSE GAS R&D PROGRAMME

MINUTES OF THE 30th EXECUTIVE COMMITTEE MEETING Vaasa, Finland, 12th – 13th September 2006

PRESENT Members and Sponsors:

K Thambimuthu Australia (Chairman) S-O Ericson Sweden (Vice-Chairman) J Carras Australia J Davis Australia B Reynen Canada M Wilson Canada B Seckington Canada I Savolainen Finland M Ohlström2 Finland I Czernichowski-Lauriol2 France J-F Hake Germany S Fukuda1 Japan S Jegarl2 Korea E Lysen Netherlands P Versteegh Netherlands R Whitney New Zealand S Koren2 Norway K Möllersten Sweden C Ball1 UK J Braitsch USA M Wolf2 Alstom G Farthing2 Babcock & Wilcox A Wharton2 BG Group T Hill E.ON UK R Rhudy EPRI J Hamilton ExxonMobil G Galliano Repsol YPF I Le Nir Schlumberger T Mikus Shell T Sundset Statoil L de Marliave TOTAL J Podkanski IEA – OECD

IEA GHG team:

H Audus General Manager J Gale J Davison M Haines J Topper IEA EPL

Observers:

M Akai AIST, METI, Japan B Durie IEA GHG Australian Consortium M Esbaitah CO2CEC, Kuwait K Warmuzinski Polish Academy of Sciences C Wang Tsinghua University, China

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Note: New and replacement members of the Committee are shown with a superscript 1 in the list of attendees. People who attended as the representative of a Member or Sponsor for the purposes of this meeting but who are not their permanent representative are shown with a superscript 2. Apologies:

EGoettlicher Austria T Zillner Austria A Mortensgaard Denmark M Madsen Denmark P Dechamps European Commission D O’Brien European Commission P Salokoski Finland A Rojey France H Höwener Germany P Dadhich India T Eto Japan H-M Eum Korea T Matheson New Zealand T Riis Norway B-E Haugan Norway L Gutzwiller Switzerland G Schriber Switzerland A Gault UK L Miller USA G Kaefer ALSTOM D Ord BG Group G Hill BP A Lee Chevron S Carminati EniTecnologie J Heithoff RWE L Stromberg Vattenfall AB M Hamel OPEC

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1. WELCOME AND INTRODUCTIONS On behalf of the Executive Committee (ExCo), the Chairman welcomed Members’ and Sponsors’ representatives and observers and introduced those attending an ExCo meeting for the first time. 2. ADOPTION OF AGENDA The agenda and motion for procedure at the meeting (document GHG/06/40) was adopted. 3. ELECTION OF VICE-CHAIRMAN Document GHG/06/41 refers. Sven-Olov Ericson was nominated by Erik Lysen and seconded by Jürgen-Friedrich Hake. Members unanimously re-elected Sven-Olov Ericson as Vice Chairman of the Executive Committee for a further 2 years. 4. MINUTES OF THE PREVIOUS (29th) MEETING Members formally approved the minutes (document GHG/06/37). 5. MATTERS ARISING FROM THE 29th MEETING Document GHG/06/43 refers. In response to a question from Bill Reynen on action 21, John Gale reported that the IEA gap analysis of the IPCC Special Report on CCS will be sanitised and edited, to enable it to be posted on the CSLF website.

Action 1: General Manager 6. PROGRESS REPORT Document GHG/06/44 refers. Harry Audus summarised overall progress since the 29th meeting. Membership – Contracting Parties Kelly Thambimuthu informed the ExCo that Venezuela has withdrawn from the IEA Greenhouse Gas R&D Programme, by email dated 13th October 2005. No formal reason was stated. The Executive Committee unanimously approved the withdrawal, which will be effective as of 12th September 2006. It is expected that OPEC membership will be approved at a meeting of CERT on 16th October. It is hoped that Indian membership will be finalised by the next ExCo meeting. The IEA formalities for Austrian membership have been started. Membership – Sponsors Harry Audus apologised to BG, B&W and Schlumberger for the delays in completion of their membership applications, due to changes in the procedure for new sponsors. However, he expected that these changes would make it easier for sponsors to join the Programme in future. Members unanimously approved CO2CEC’s participation as a Sponsor in the IEA Implementing Agreement. Members authorised the General Manager to expedite the formal procedures for CO2CEC’s membership and complete negotiations on the terms and conditions on behalf of the Executive Committee.

Action 2: General Manager Staff Harry Audus asked Members to consider secondments of staff to the Programme Team. Studies Harry Audus summarised the studies which had been approved at earlier meetings but which have not yet been started. A study on CCS in National Inventories and Trading Schemes was approved at the 27th meeting but it had been agreed that the start of this study would be delayed pending completion of the revised IPCC Inventories Guidelines Report. Harry Audus suggested that this study had been superseded by IEA GHG’s other activities on this subject, in particular work on development of CDM methodologies. It was agreed that this study would not be carried out.

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Makoto Akai reported that a study on accounting and CDM was being done in Japan. He offered to send a copy to Harry Audus, who would distribute it to Members. Members should send comments to Harry Audus, who will collate them and pass them on to Makoto Akai.

Action 3: Makoto Akai / General Manager / Members Future membership Document GHG/06/45 refers. Harry Audus summarised the paper on future membership and pointed out that the Programme currently has relatively few members from non-Kyoto countries, the power industry and industry associations. John Carras suggested that population and global coverage should be important categories when considering new members and he pointed out that there are currently no African members. John Topper said that South East Asia is also an important area which should be targeted. He also said that, in common with IEA GHG, the IEA Clean Coal Centre (IEA CCC) de-rates subscriptions for developing countries. However, IEA CCC links their subscriptions to their growth in national GDP to reflect increasing ability to pay, to enable the subscriptions to be gradually increased as the countries become developed. He suggested that IEA GHG should do the same. In response to a query from Peter Versteegh, Harry Audus said that there did not appear to be any segmentation of interest among the current membership. Clare Ball said that NEET would provide a good forum for obtaining membership from developing countries. John Topper reported that he had attended the launch meeting of NEET in Washington in May and expected to attend 5 of the further 6 workshops in the series in S Africa, China, India, Brazil, Mexico and Russia; the next being in S Africa in February 2007. The proposals set out in the paper were accepted and in addition it was agreed that there was a need for more global representation. Strategy survey Document GHG/06/46 refers. Harry Audus reported that there had been a poor response from Members to the request for comments on IEA GHG’s phase 5 strategy document. Erik Lysen offered to share with the ExCo the research agenda and plans of the EU Zero Emissions Technology Platform. The summaries are attached as Annex 1. He suggested that these should be considered in IEA GHG’s strategy. It was agreed that Harry Audus and Jürgen-Friedrich Hake will work on economic modelling and come back with a proposal. Jürgen-Friedrich Hake offered to set up an informal e-mail platform of Members, which may lead to a network.

Action 4: Jürgen-Friedrich Hake / General Manager Harry Audus said that the IEA Secretariat needs to be involved. Jacek Podkanski said we should be wary about becoming involved in modelling as it is a political minefield. Jay Braitsch said that the DOE puts a lot of effort into modelling which is currently a poor tool for senior managers but a decision tool would be helpful. Ilkka Savolainen said we should collaborate with ETSAP. John Topper suggested we could become involved with ISO activities on standards. John Carras also mentioned the work on IPCC guidelines. Rob Whitney said the IPCC and CDM executive board are the main playing fields and the ISO is on the sidelines. Harry Audus said that involvement in standards is very time consuming and the general feeling was not to become involved. Harry Audus said that most of IEA GHG’s networks have short lives and are funded by the Members of IEA GHG but the Biofixation Network is different as it is funded by its own members and has its own network manager. Despite this, the Biofixation Network requires significant management effort by the IEA GHG Programme Team. He suggested that the Biofixation Network should be set up as a separate Annex to the Implementing Agreement. Peter Versteegh suggested that it would be more logical to bunch all the networks together in one annex. Erik Lysen suggested a task shared agreement for the networks. John Gale pointed out that there are different active parties in each of the networks, which would be complication. Following discussion, it was agreed that setting up a new Annex for the Biofixation Network could cause major problems and it would probably require more effort than is

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currently needed to manage the network. It was agreed that a new Annex will not be set up but the Biofixation Network will be told to improve its own management.

Action 5: General Manager Peter Versteegh suggested setting up a sub-group to discuss IEA GHG’s objectives and obstacles to us achieving these objectives. Richard Rhudy said we should consider what has changed externally that may affect what we do. Erik Lysen said we need to package messages in a form that is useful for policy makers. Bill Reynen said the best vehicle for this is the G8 series of workshops and we should consider how our work feeds in to these workshops. It was agreed that members will send comments on IEA GHG’s strategy to Harry Audus, who will report back to Members.

Action 6: Members / General Manager 7. IEA MATTERS IEA secretariat report Document GHG/06/47 and Annex 2 refer. Jacek Podkanski reported that the first draft of the report of the IEA/CSLF meeting in San Francisco will be available in mid-October. Presentations will be available on the IEA website in late September. Bill Reynen said that there had been positive feedback from this workshop. Trude Sundset asked Members to send her ideas for the second workshop to be held in Norway.

Action 7: Members Jacek Podkanski said that the IEA intends to feed the G8 with messages from the workshops. The IEA will hold a meeting on legal aspects of CCS in Paris on 17th October. Jacek Podkanski asked Members to suggest topics for discussion panels.

Action 8: Members The IEA has recently published the Energy Technology Perspectives 2006 report. Jacek Podkanski will send 30-40 copies of the report to Harry Audus, who will distribute them to Members.

Action 9: Jacek Podkanski / General Manager In response to a question from Kelly Thambimuthu, Jacek Podkanski said that the new World Energy Outlook will include CCS in alternative scenarios. IEA GHG on IEA matters Document GHG/06/48 refers. Harry Audus tabled a self assessment form which he had produced as part of the process for obtaining CERT authorisation of an extension to the Implementing Agreement. A copy is attached as Annex 3. Regarding the response to the G8 communiqué, Harry Audus said that it is effective to use other people to disseminate our information. In response to a query, Jacek Podkanski said that he cannot guarantee that IEA’s capture ready study will be jointly badged with IEA GHG. He could arrange for IEA GHG to use the G8 Gleneagles logo on its report. Peter Versteegh and Markus Wolf said he would like to receive a copy of the draft report on IEA GHG’s capture ready study as soon as possible.

Action 10: General Manager Harry Audus said that they should be aware that substantial changes may be made to the draft report to take account of comments received from reviewers. 8. ANNUAL REPORT 2005 Document GHG/06/49 refers. It was agreed that Harry Audus will tidy up the text and avoid repetition in the 2005 annual report. The report will then be issued.

Action 11: General Manager

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9. PROGRESS WITH COMMUNICATIONS STRATEGY Document GHG/06/50 refers. John Gale presented a summary of progress with the communications strategy. Erik Lysen questioned who the information papers are targeted at. He said that papers to brief journalists would be useful and very concise information is needed for a broader public. Bill Reynen said that the issues that were identified as negative in the IPCC media review were actually valid views and issues. We need to recognise this in the information papers. Kelly Thambimuthu said that two levels of information are needed: information for policy makers and information for journalists and the public. He asked Members to feedback ideas of topics for information papers.

Action 12: Members Jacek Podkanski said that talk of challenges and gaps has negative connotations. We should talk about what we know and encourage building of new plants. In response to a suggestion from Mike Haines, Kelly Thambimuthu said that if there is a pressing need for information papers in other languages, Members should arrange for translation into their own languages. Erik Lysen pointed out that the 4-page CO2NET brochure had been translated into many languages. Harry Audus said that we need a vision of how we get to large scale deployment. Clare Ball said we should focus on how to get demonstration plants and how to share the risks and benefits of such plants. Jon Davis said we need to show how cost reductions can be achieved. Erik Lysen emphasised the need to give incentives for CCS in EU national allocation plans. Several Members commented that it would not be helpful for IEA GHG to produce another roadmap. Bill Reynen said he would like to see our efforts focussed on helping the G8 initiative. It was agreed that the Programme Team will do some strategic thinking regarding their future actions.

Action 13: General Manager GHGT-8 and GHGT-9 conferences Document GHG/06/51 refers. John Gale reported on feedback from GHGT-8 and progress with GHGT-9. He asked Members approval for IEA GHG to purchase a paper management system for future GHGT conferences, at a cost of less than £30k. Peter Versteegh asked if we could share the system with IEA. John Topper said that IEA CCC might also use the system. Kelly Thambimuthu asked if this cost included annual updates and whether the costs would be recovered from the income of the GHGT conferences. John Gale said the expenditure would be recovered over the next 2-3 conferences. Richard Rhudy asked whether future sponsors of the conference will be obliged to use IEA GHG’s paper management system. Rob Whitney suggested that a business case should be prepared but Jon Davis said that a decision could be taken now. Jay Braitsch said there was no reason to buy the system now. John Gale said the call for papers for GHGT-9 will be in October next year and some time would be needed to test the system prior to that. It was agreed that the Programme Team would assess paper management systems and if a suitable system is available at reasonable cost it would be purchased.

Action 14: General Manager Richard Rhudy asked whether one of the parallel session blocks would be replaced by panel discussions at GHGT-9. John Gale said that this was an option that was being considered but no decision has been made. Student summer school Document GHG/06/52 refers. John Gale and Jürgen-Friedrich Hake reported on plans for student summer schools on CCS. The first one will be held near Munich on 19th-25th August 2007. IEA GHG is being asked to provide £25k of launch money and £4-5k/year to sponsor attendance at GHGTs. Jay Braitsch reported that he had run a summer school in 2004-5. This had been held on a small college campus to reduce costs and had included a field trip. The cost per student was $8-9k. He expected the costs of IEA GHG’s summer schools to be higher than in the proposal. In response to a question from Harry Audus, Jürgen-Friedrich Hake said that he had assumed speakers will not charge. Jon Davis endorsed the proposal but advocated caution on costs. He expected there to be demand for far more than 50 students and he suggested providing video conference presentations to other hubs around the

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world. Harry Audus replied that video streaming is possible but he would prefer to perhaps do it for the second meeting. He also said companies would be asked to sponsor people to attend. Jon Davis also asked whether we were targeting researchers or people who will implement CCS. Jürgen-Friedrich Hake said both groups would be included. The summer schools would be interdisciplinary and would include scientists, engineers, economists etc. In response to a query from Richard Rhudy he said that people already working in the field of CCS would be targeted. Markus Wolf asked how the students would be chosen and wanted to avoid building an artificial elite. Malcolm Wilson said that the UK Energy Research Council has run similar activities for graduate students. Students had to send a submission saying why they wanted to be there. John Carras said that it is important to get more young people to attend the GHGT conferences. Bill Reynen said that ARC had developed material for APEC, which could be used for the summer schools. Kelly Thambimuthu summarised by saying that members approved the proposal subject to sorting out the details and costs. John Gale agreed to produce a more detailed proposal which would be circulated for discussion. He suggested that some funding could be provided from surplus funds of GHGT-8.

Action 15: General Manager Executive conference Further to the written papers, John Gale described proposals for an Executive Conference, which could be held in the year between GHGT conferences. Bill Reynen said that the GHGT conferences had enhanced prestige because they are held every 2 years. He also said that next year will be busy with CSLF and G8 series meetings. Isabelle Czernichowski-Lauriol said that there will be a similar conference in France in 2007. Several members expressed reservations about the proposed conference, they questioned its aims and emphasized the need to concentrate on maintaining the quality of GHGT conferences. However, Trude Sundset said that many of the existing conferences are low quality and she supported the proposal for IEA GHG to organize an executive conference in 2007. Kelly Thambimuthu summarized by saying that Members agreed a major conference alternating with GHGT would not be feasible because of the effort required by the Programme Team.

Action 16: General Manager John Gale asked Members to tell him by e-mail of major events and conferences, to enable him to compile a diary of events, to put on the website.

Action 17: Members / General Manager 10. CONCLUSIONS FROM COMPLETED TECHNICAL STUDIES CO2 capture as a factor in power plant investment Document GHG/06/53 refers. John Davison reported on this completed study. In response to a question from Rob Whitney, John Davison said that the high ranking reported for pre-combustion gas fired plants was due to various non-financial factors such as environmental impacts and the ability to co-produce hydrogen. In response to a question from Jay Braitsch about the error bars, John Davison said the results were similar when based on responses from two different sets of investors: those who responded to the written questionnaire and the larger number of investors who took part in the telephone survey. This gave some degree of confidence in the robustness of the conclusions. Zero emissions technologies for power generation Document GHG/06/54 refers. Mike Haines reported on this completed study. Sven-Olov Ericson and Ilkka Savolainen said that co-combustion of some biomass could result in zero or even negative net emissions, despite the residual emissions from the plant and fuel supply chain etc. In response to comments, Mike Haines said that fuel transport distances have a major impact on emissions. In response to a comment from Bill Reynen he also said that oxy-combustion has advantages if the target is zero emissions but otherwise it may not be the economic optimum. Sven-Olov Ericson and Tim Hill asked about other emissions, such as SOX, NOX and mercury. Mike Haines said that there are significant issues to be explored, for example SOX may be converted to acid. Kelly Thambimuthu said that mercury management is better in oxy-combustion than in other systems. It was agreed that care should be taken when presenting the results of the study.

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Environmental impacts of solvent scrubbing Document GHG/06/55 refers. John Davison reported on this completed study. In response to questions from Kelly Thambimuthu, he said that the study excluded any environmental impacts of impurities contained in CO2 fed to storage, as the impacts underground were too difficult to quantify. He also said that there is some information on reaction of solvent with oxygen but it is very sensitive to solvent concentration, additives etc. Shortage of basic data from process licensors and elsewhere was a major obstacle for the study. It was agreed that this topic should be discussed at the CO2 Capture Network. John Topper said that he intends to include it in the agenda of the next network meeting in mid-2007. Several members expressed strong concerns about the use of spider diagrams in the report, as they could give the wrong message and the numbers are subject to large uncertainty. However, it was also said that we should not give the appearance that we are defensive and hiding results. Richard Rhudy emphasised the importance of environmental impacts of solvents and said that we should do more work rather than release the report at this time. John Topper said that the IEA CCC/GHG review of capture methods, currently being written, should identify some areas of concern and might be used to help identify necessary basic research. Kelly Thambimuthu asked members to read and comment on the draft report summary when it is sent out in the near future. If we are unhappy with the report we should hold it back.

Action 18: Members / General Manager 11. RESEARCH NETWORKS Documents GHG/06/56 refers. John Gale summarised the international research networks which the Programme has been involved in since the 28th meeting. Tim Hill asked how the results presented at the Well Bore Network relate to results from the North Sea. John Gale said that there was no information but because the North Sea operations are newer they may suffer fewer problems. He emphasised that the network had only looked at operating wells, not abandoned wells. Malcolm Wilson proposed that IEA GHG organise a 1-off network meeting to bring together people from key projects to agree a glossary of terms to use in best practise manuals. Trude Sundset supported the proposal. Members agreed that IEA GHG should canvas opinion on the usefulness and willingness to take part in such a meeting.

Action 19: General Manager 12. PRACTICAL INITIATIVES Document GHG/06/57 refers. John Gale provided an overview of practical R&D activities since the 28th meeting. Several Members supported the proposal for IEA GHG to synthesise global data on CCS projects and to use its database to pull together information and identify gaps in demonstration projects. Some members suggested the need to avoid overlaps with parallel activities by the CSLF, EU and IEA Clean Coal Centre.

Action 20: General Manager 13. LIAISON/ACTIVITIES WITH OTHER ORGANISATIONS CSLF Document GHG/06/58 refers. Harry Audus reported that IEA GHG is cooperating with the CSLF on an ad-hoc basis. Members agreed to CSLF use of IEA GHG data provided its source is acknowledged. Trude Sundset and Bill Reynen invited IEA GHG to attend a CSLF workshop in London in November.

Action 21: Trude Sundset / Bill Reynen / General Manager APEC Document GHG/06/59 refers. John Gale reported that IEA GHG will take part in two APEC workshops in China and Mexico. These will be the last in the series of workshops. Kelly Thambimuthu reported that there is a synergy with the AP6 partnership’s programme on clean energy. Erik Lysen said that it would be useful for IEA GHG to communicate with the French organisers of the EU COACH project on CCS in China.

Action 22: General Manager

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On a related issue, John Gale reported that IEA GHG was about to start a study to assess regional potential for storage of CO2 in India, following on from IEA GHG’s earlier studies on Europe and North America. The study will be co-financed by the UK government (DEFRA), from their G8 Gleneagles follow-up fund. CCS/CDM working group Document GHG/06/60 refers. Mike Haines reported on a series of workshops in London, Paris and Vienna. Bill Reynen reported that the only opposition to CCS at the SBSSTA meeting, where CDM was discussed, was from WWF and Greenpeace and their main concern had only been to ensure good monitoring. Kelly Thambimuthu suggested a streamlined methodology and approvals process. Mike Haines said that methodologies will be developed for particular projects and they will be consolidated later. Rob Whitney said that inclusion of CCS in the CDM is an important activity and he encouraged the Programme to devote as much resources as is necessary. 14. FUTURE STUDIES Results of prioritisation exercise Document GHG/06/61 refers. John Davison reported on the outcome of Members’ voting on prioritisation of future studies. John Topper questioned why only around half of members voted. He strongly urged them to vote in future, as their views are important. CO2 capture in the cement industry Document GHG/06/62 refers. John Davison described this proposed study, noting that it coincided with IEA interest in the topic. Kelly Thambimuthu suggested that industry associations in developing countries should be engaged in the study if possible. Sven-Olov Ericson said that biomass can be used to reduce emissions from cement plants. Improved solvent processes for CO2 capture Document GHG/06/63 refers. John Davison described this proposed study. He pointed out that the study will depend on availability of data from process developers and it may be necessary to curtail the study if such data turn out to be not available. It was agreed that ionic liquids would not be included in this study as they are at a relatively early stage of development. Richard Rhudy said that EPRI and Alstom will start up a chilled ammonia process pilot plant next year, so it may be too early to carry out this study. He said Powerspan’s ECO process should be considered for inclusion in the study. John Topper encouraged dialogue with IEA CCC, which is doing a review of CO2 capture that is concentrating on solvent processes. Potential break-through capture processes Document GHG/06/64 refers. Mike Haines described this proposed study. Kelly Thambimuthu said the study should focus on a particular timeframe, say 2020. He said that improvements in the thermal efficiencies of base-case plants should be taken into account. Jay Braitsch recommended not using the word “breakthrough” as it is too dramatic a word. He emphasised the difficulty of doing economic assessments of processes which are at an early stage of development. He recommended continuing to use PPAP. Richard Rhudy agreed and said processes should be included in the evaluation even if it is not possible to do an economic evaluation. Peter Versteegh said his organisation had developed techniques to evaluate new opportunities and he offered to help devise a structured approach for the work. Tom Mikus said that many people are working on this, including CACHET and CO2CRC and we need to synthesise with these activities. He said that many of the new ideas will not be in the literature and he proposed a brainstorming approach. Safety considerations for CO2 transmission and injection facilities Document GHG/06/65 refers. Mike Haines described this proposed study. Clare Ball said that this is a potential show-stopper issue and the UK strongly supports the study. Tim Hill also supported the study and considered it to be very timely. He asked for costs implications of safety measures to be included. John Carras recommended comparing data for CO2 pipelines with data for natural gas pipelines, to put them in context.

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Conclusion of the prioritisation exercise Kelly Thambimuthu concluded by saying that Members agreed to go ahead with the four studies that had been presented, taking into account the comments made by Members at the meeting.

Action 23: General Manager Reserve study proposal: Trans-boundary transmission and storage Document GHG/06/66 refers. Because the four studies with the highest numbers of votes had been approved, this proposal was not presented. However, Blair Seckington asked for this study to go ahead if problems are encountered with any of the four agreed studies. 15. MEMBERS IDEAS FOR FUTURE STUDIES It was agreed that the following studies will be re-submitted to the next round of voting by Members:

• Regional assessment of power plants with CCS • Use of biomass with CCS • Trans-boundary transmission and storage (if this study is not carried out as a reserve)

Action 24: General Manager Malcolm Wilson suggested an update on the PSA study carried out during phase 1 of the Programme. Members were invited to suggest other topics for future studies.

Action 25: Members In response to a comment from Sven-Olov Ericson, Kelly Thambimuthu agreed that there is a need to ensure that minority interests are taken into account when selecting studies. 16. PRESENTATIONS BY MEMBERS OF THEIR ACTIVITIES Shuichi Fukuda and Makoto Akai presented a proposal on ‘Development of international collaboration for building confidence in the long-term effectiveness of Carbon Capture and Storage’ (see Annex 4). Members approved IEA GHG’s participation in this activity. It was agreed that a Japanese presentation on this topic would be made at the Risk Assessment Network meeting in early October.

Action 26: General Manager / Makoto Akai Erik Lysen presented a proposal to host GHGT-10 in Amsterdam. Isabelle Czernichowski-Lauriol said that France had been considering bidding to host GHGT-10 but they supported the Dutch proposal and they would be happy to be involved in the organizing committee. Clare Ball said the UK had also been considering hosting GHGT-10 but they too supported the Dutch proposal. It was agreed in principle to hold GHGT-10 in Amsterdam but the Netherlands will produce a more detailed proposal for further evaluation by the Programme. It was agreed that expressions of interest for GHGT-11 would not be accepted until after GHGT-9. 17. RELATIVE MERITS OF ABATEMENT OPTIONS Document GHG/06/67 refers. Harry Audus presented a discussion document on this subject and invited Members to propose any further action. John Topper said that comparing the relative merits of options was a good idea but he was concerned that we will be working with other organisations that will want to promote their own technologies. Sven-Olov Ericson said this is an important topic, which the Programme had touched on in phases 2 and 3. He said that the Programme has the best possibility to do this work. To avoid conflict we should not put options against each other. Following on from a comment from Jay Braitsch he agreed that 2020 would be a good timeframe for the assessments. Richard Rhudy supported the proposal and asked how long the work would take. He also said we should work with others. Harry Audus said that we will work with other IEA Implementing Agreements. He suggested a workshop with other Implementing Agreements but pointed out that there may be difficulties because most of them do not have a central organisation. He said that the first stage of the work would be done in-house within a year. Erik Lysen supported working with other IAs and said it would be good to get an overall IEA badge for the work. Erik Lysen and John

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Carras emphasised the need to develop a methodology before comparing options. Jürgen-Friedrich Hake said the work would require much time and require expertise outside of the IEA Implementing Agreements. Harry Audus said that power utilities that operate all types of plant would be involved. Makoto Akai offered to contribute his inventory of studies to the collaboration. Peter Versteegh emphasised the importance of non-technical issues and said that the methodology should be allowed to change with time. Kelly Thambimuthu summarised by saying there was broad support and the proposed work should proceed but with a cautious approach.

Action 27: General Manager 18. OPERATING AGENT REPORT There was no paper on this item. John Topper reported that the Operating Agent had no concerns regarding the finances. He also said the Programme Team is small and needs to be enlarged as more resources become available. The search for new office accommodation is continuing. 19. FINANCES Documents GHG/06/68-70 refer. Harry Audus tabled the Members’ Accounts (see Annex 5) and reported on the Programme’s finances. It was suggested that the definition of the start of the year for Programme Phases could be made the same as the financial year. However it was agreed that this would not happen, because it would cause problems for some Members. 20. NEXT MEETING Document GHG/06/71 refers. The 31st meeting will be held in Amsterdam, The Netherlands on 19th and 20th April 2007. There will be a technical visit on the 17th and a forum on the 18th. The 32nd meeting will be held in Daejon, South Korea on 16th-19th October 2007. The 33rd meeting will be held in Berlin in spring 2008. The 34th meeting will be held in Washington DC, USA on 13th and 14th November 2008, before GHGT-9. The 35th meeting will be in Brisbane, Australia in May 2009. Trude Sundset offered to alert the CSLF secretariat to the dates of the Amsterdam meeting, to avoid a conflict of dates with a meeting that the CSLF plans to hold in Paris.

Action 28: Trude Sundset 21. ANY OTHER BUSINESS Jon Davis asked for an overview of studies underway to be included in future meetings.

Action 29: General Manager Kelly Thambimuthu concluded by thanking Mikael Ohlström and Ilkka Savolainen for organising and hosting the meeting on behalf of Finland.

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ANNEX 1

SUMMARY OF EU ZERO EMISSIONS TECHNOLOGY PLATFORM

The European Technology Platform for Zero Emission Fossil Fuel Power Plants (ZEP)

Strategic Research Agenda

7 September 2006

2

Key recommendations Experts agree that CO2 capture and storage technology (CCS), together with improved energy conversion efficiency, is a near-term solution to reducing CO2 emissions from fossil fuel power generation on a massive scale. Its immediate deployment is therefore vital if we are to avoid the catastrophic consequences of climate change we are facing today.

Yet despite most of the technology elements being available, CCS is still not deployed for two key reasons:

1. The costs and risks still outweigh the commercial benefits 2. The regulatory framework for CO2 storage is not sufficiently defined.

The Strategic Research Agenda therefore describes a collaborative programme of technology development for reducing the costs and risks of deployment; while the Strategic Deployment Document outlines how we can accelerate the market for zero emission power production. To this end, the Technology Platform for Zero Emission Fossil Fuel Power Plants (ZEP) recommends (under FP7):

1. Urgently implementing 10-12 integrated, large-scale CCS demonstration projects Europe-wide Improve the cost-effectiveness and availability of current CO2 capture

technologies; optimise energy conversion efficiency when integrated into a power plant; and bring to commercial readiness by 2020

Assess the full potential for CO2 geological storage, demonstrate its safety to the public and understand/respond to their concerns

Resolve all technological uncertainties and establish a critical mass of data for exploitation in parallel R&D projects

2. Developing new concepts already identified, but not validated, for demonstration by 2010-2015 and implementation beyond 2020, e.g. Advanced new materials and combustion systems Storage in onshore, deep saline aquifers and CO2 for Enhanced Oil Recovery in

the North Sea

3. Supporting long-term exploratory R&D into advanced, innovative concepts for implementation of next-generation technology by 2050, e.g.

Innovative CO2 capture technologies (membranes, adsorption etc.) Innovative concepts for CO2 storage Simple, reliable tools for long-term modelling and monitoring of CO2 storage

4. Maximising cooperation at national, European and international level Mobilise national and European funding and explore new options for launching

large integrated projects, such as Joint Technology Initiatives Further promote international cooperation, especially with emerging countries

such as China and India.

5. Strengthening and accelerating R&D priorities to support the Strategic Deployment Document, informed by experience from demonstration projects and parallel R&D projects on advanced, innovative concepts.

1

The European Technology Platform for Zero Emission Fossil Fuel Power Plants (ZEP)

Strategic Deployment Document

7 September 2006

2

Key recommendations Experts agree that CO2 capture and storage technology (CCS), together with improved energy conversion efficiency, is a near-term solution to reducing CO2 emissions from fossil fuel power generation on a massive scale. Its immediate deployment is therefore vital if we are to avoid the catastrophic consequences of climate change we are facing today.

Yet despite most of the technology elements being available, CCS is still not deployed for two key reasons:

1. The costs and risks still outweigh the commercial benefits 2. The regulatory framework for CO2 storage is not sufficiently defined.

The Strategic Research Agenda therefore describes a collaborative programme of technology development for reducing the costs and risks of deployment; while the Strategic Deployment Document outlines how we can accelerate the market to achieve zero emission power production by 2020. To this end, the Technology Platform for Zero Emission Fossil Fuel Power Plants (ZEP) recommends:

1. Kick-starting the CO2 value chain with urgent short- and long-term commercial incentives: By 2007, clarify the conditions under which the geological storage of CO2

qualifies for the EU Emissions Trading Scheme and other incentive mechanisms

By 2007, clarify CCS status under European Union guidelines for State Aid By 2007, create early mover funding mechanisms to support the development of

10-12 large-scale CCS projects which demonstrate a diverse range of infrastructure, technologies, fuels and storage locations.

Establish long-term, sustainable mechanisms to supplement EU ETS, informed by experience gained in demonstration projects.

2. Establishing a regulatory framework for the geological storage of CO2:

By 2007, amend existing EU legislation (concerning waste and water) in order to clarify the conditions under which CO2 is stored underground

By 2008, implement new EU guidelines for Member States permitting geological storage projects (including risk management, site selection, operation, monitoring, reporting, verification, closure and post-closure).

3. Gaining public support via a comprehensive public information campaign:

Generic EU-wide outreach via multi-media (TV, internet, print) Local, focused outreach in support of early mover CCS projects.

4. Establishing robust RD&D funding under the FP7 and national programmes (see Strategic Research Agenda):

Improve energy conversion efficiency, reduce cost and reduce scale-up risk of CO2 capture technology

Undertake EU-wide mapping of large CO2 sources and geological storage By 2008, establish a Joint Technology Initiative as part of a portfolio of

mechanisms for maximising European co-operation.

GHG/06/72

ANNEX 2

IEA SECRETARIAT REPORT PRESENTATION

AGENCE INTERNATIONALE DE L’ENERGIEINTERNATIONAL ENERGY AGENCY

2nd IEA WORKSHOP ON LEGAL ASPECTS OF STORING CO2

PARIS,17 OCTOBER 2006

Jacek PodkanskiInternational Energy Agency

Energy Technology and R&D Office

INTERNATIONAL ENERGY AGENCY AGENCE INTERNATIONALE DE L’ENERGIE

Agenda

Intellectual Property

National Legal and Regulatory Frameworks

International Marine Environment Protection Instruments

Level Playing Field for CCS Projects

Public Awareness

INTERNATIONAL ENERGY AGENCY AGENCE INTERNATIONALE DE L’ENERGIE

Agenda

Time Topic Speaker

8.00 Registration and Coffee

8.30 Opening Remarks French Host

John Ryan Department of Industry Tourism and Resources Australia

Claude Mandil Executive Director International Energy Agency

8.45 Welcome Address Barbara McKee Chair Working Party on Fossil Fuels

9.00 Update on Carbon Capture and Storage: Recent Developments

???

Session 1: Intellectual Property

9.30 Moderator Tony Espie BP

Scene Setting Mike Smith (confirmed) Southern States Energy Board United States of America

10.00 Panel Discussion Ian Harvey Intellectual Property Institute United Kingdom

Project based lawyer??

???

10.30 Morning Tea

© OECD/IEA - 2006

2 0 0 6

ENERGYTECHNOLOGY

PERSPECTIVES

Scenarios &Strategies

to 2050

Energy Technology Perspectives 2006

Jacek PodkanskiInternational Energy Agency

Vaasa, Finland12-13 September 2006

2 0 0 6

ENERGYTECHNOLOGY

PERSPECTIVES


to 2050

Energy Technology Perspectives 2006

2 0 0 6

ENERGYTECHNOLOGY

PERSPECTIVES


to 2050

Global CO2 emissions 2003-2050Baseline, ACT and TECH plus scenarios

0

10,000

20,000

30,000

40,000

50,000

60,000

2003 Baseline2030

Baseline2050

Map No CCS LowEfficiency

TECH Plus2050

Other

Buildings

Transport

Industry

Transformation

PowerGeneration

ACT Scenarios 2050

-16%

+137%

+6%+21%

+27%

[Mt CO2/yr]

CO2 emissions can be returned to current levelsthrough a portfolio of technologies

2 0 0 6

ENERGYTECHNOLOGY

PERSPECTIVES


to 2050

Emission reduction by technology areaACT Map Scenario

Improved energy efficiency most important contributor to reducedemissions, CCS accounts for 20% of Act Map emissions reduction

Other renewables

Biomass

Fossil fuel generation efficiency

Nuclear

Coal to gas

Hydropower

CCSPower

generation

End-useefficiency

Biofuels in transport

CCS in fuel transformation

CCS in industry

Fuel mix in buildings and industry

2 0 0 6

ENERGYTECHNOLOGY

PERSPECTIVES


to 2050

Impact of technology assumptions on marginal emission abatement costs

Absence of CCS significantly increases marginal cost of CO2 emissions reduction

0

10

20

30

40

50

Europe China

US

D/t

CO

2

ACT Map

C - LowNuclear

C - LowRenewables

C - No CCS

2 0 0 6

ENERGYTECHNOLOGY

PERSPECTIVES


to 2050

CO2 intensity of coal-fired power generationChina 2003 - 2050

0

200

400

600

800

1,000

1,200

2003 Baseline 2030 Baseline 2050 ACT Map2050

Gra

ms

of

CO

2 p

er k

Wh

CC

S

Imp

act

More than 50% reduction in CO2 intensity due to improved generation efficiency and CCS

2 0 0 6

ENERGYTECHNOLOGY

PERSPECTIVES


to 2050

Key findingsMost energy still comes from fossil fuels in 2050

CO2 emissions can be returned towards today’s level by 2050

Growth in oil and electricity demand can be halved

Improving energy efficiency is top priority

CCS is key for a sustainable energy futurePower generationIndustry and fuel transformation (40% of CCS potential)

Other important technologies:Renewables, including biofuelsNuclear Efficient use of natural gas In time, and with effort, hydrogen and fuel cells

2 0 0 6

ENERGYTECHNOLOGY

PERSPECTIVES


to 2050

Costs

25 USD/tonne CO2 incentive is upper limit for the incremental costs of using the technologies needed

Significant transitional costs for RD&D and deployment programs

Improved energy efficiency substantially reduces need for supply side investments and fuel imports

Electricity sector: demand-side savings offset most of the additional investment costs for power generation

Progress in efficiency and CCS key to keep mitigation costs down

2 0 0 6

ENERGYTECHNOLOGY

PERSPECTIVES


to 2050

Policy implications

A more sustainable energy future is possible with known technology

Costs should not be considered:disproportionatea deterrent

But urgent action is needed in public and private sectors:overcome barriers for adoption of energy efficient technologies, both economic and non-economicenhance R&Dspeed demonstration and deployment, especially for CCS

Collaboration between developed and developing countries essential

GHG/06/72

ANNEX 3

SELF-ASSESSMENT FORM FOR IA EXTENSION

GHG/06/72

Self-Assessment Form for IA Extension

CERT Criteria for Implementing Agreement Extensions Evaluation

Criteria Current Term

Proposed New Term

Structural and management criteria (a) Strategic direction • Does the work programme of the Implementing Agreement

(“IA” hereinafter in the Table) coincide with the strategies of the CERT and the relevant Working Party, and contribute to IEA Member countries’ energy technology policy goals?

5

5

(b) Scope • Is the work programme of the IA sufficiently substantive

and comprehensive? • Is the participation by countries broad enough? • Does the IA justify the transaction costs of international

collaboration? • Does the work programme contribute positively to the

quality of the IEA’s energy technology collaboration programme?

4

5

Contractual and management requirements • Does the IA meet the contractual and management

obligations to the IEA? • Are objectives, strategic plan and annual work programmes

in place? • Is the Annual Report provided in a timely and complete

manner?

5

5

GHG/06/72

Performance-based criteria

Contribution to technology evolution / progress • Do results of R&D add significant value to technology

evolution (performance improvement; potential for innovation)?

• Have R&D results been cited in the literature and/or recognised by awards?

• Have R&D results been used by institutions in participating countries?

• Are there “significant "success stories" originating from the IA?

• Are there spill-over effects to other energy technology areas?

5

(e) Contribution to technology deployment / market facilitation

• Is the strategy and work programme market relevant? • Are there significant examples that technology deployment

is accelerated and that relevant markets are facilitated through the IA’s work?

• Does industry participation help to guide the direction of the IA and accelerate technology deployment?

• Has development/deployment been successfully completed so that the role of the government is no longer needed (‘graduation’ of the programme)?

4

4

(f) Contribution to environmental protection • Does the IA make contributions to cost-efficient reduction

of environmental impact?

5

5

(g) Contribution to information dissemination • Are results of the IA’s work adequately disseminated to:

1) participating countries? 2) IEA Member countries? 3) non-Member countries?

• Is there a contribution to the acceptance of the technology? • Are there contributions to the OPEN Energy Technology

Bulletin and other IEA and non-IEA communication channels?

5

5

5

GHG/06/72

Value-based criteria

(h) Added value • In terms of reduced or avoided research costs? • In terms of return on investments and improved

competitive position? • In terms of contribution of R&D results to cost

reduction? • In terms of results that could only be achieved through

the international collaboration project? • In terms of national R&D capabilities through improved

access to personnel exchange, training, information, technology or equipment?

5

Please add comments on individual points To make evaluation metrical, scores from 1 to 5 are introduced:

5(excellent), 4(good), 3(average), 2(insufficient), 1(very insufficient) Such scores can be supplemented by short comments. Not all criteria in the Table are relevant

for all IAs. Therefore, some criteria will generate “not applicable” (n.a.) as an answer. NOTES: (Referenced to items in the table) (b) The programme is an excellent forum in which a wide range of countries and international entities take part. Efforts are being made to improve the representation from major developing countries. India has applied for membership and the formalities are nearly complete. (d) There are many significant successes the overall result is that CO2 capture and storage is now firmly accepted as a major policy option to reduce CO2 emissions. The Programme continues to work to reduce the costs involved and facilitate the adoption of CO2 storage deep underground. Of many specific examples, a few are:

• The programme has revitalised the development of solvent processes for CO2 capture and fostered a wide-spread R&D interest in oxyfuel-combustion.

• The programme has established the wide-spread availability of underground storage for CO2. It has also promoted many initiatives in the area such as the development of best practice manuals, measuring monitoring and verification requirements, and work on remediation options in the event of any seepage of CO2 from either the wells or the strata.

• At the time of writing the Programme is working with industry and relevant institutions on the development of methodologies to enable carbon capture and storage to be accepted as a Clean Development Mechanism.

(e) The Programme encourages and takes part in many R&D initiatives. It has however, limited funds and is not able to fund major activities. Perhaps the major success has been the successful cooperation with the Weyburn CO2 EOR project but there are many others including active participation in Sleipner and a number of EU programmes. There is a need for several large scale demonstrations of carbon capture and storage and IEA GHG is actively promoting such schemes. Recently such a proposal was tabled to the IEAs WPFF in the hope of generating interest within the IEA on facilitating such a development (on the lines of the IEA Grimethorpe project in the UK during the early 1980’s). (f) Raison d’être. (g) The programme actively works with the IEA in many areas e.g. taking part in WPFF activities, and at present assisting with the G8 response with regard to ‘early-opportunities’ and ‘capture-ready’ power plant. The programme has made a major contribution to IPCC activities. A recent innovation is the establishment (through Elsevier) of a major international journal on greenhouse gas control.

5

GHG/06/72

ANNEX 4

DEVELOPMENT OF INTERNATIONAL COLLABORATION FOR BUILDING CONFIDENCE IN THE LONG-TERM EFFECTIVENESS

OF CARBON CAPTURE AND STORAGE

ANNEX 5

IEA Greenhouse Gas R&D Programme

Members’ Accounts

31 March 2006

IEA Greenhouse Gas R&D Programme Directors’ report and accounts

31 March 2006 Accounts Contents Operating Agent’s report 1 Statement of responsibilities of the board of IEA Environmental Projects Limited 2 Independent auditors’ report to the members of IEA Greenhouse Gas R&D Programme 3 Income and expenditure account 4 Balance sheet 5 Notes 6


31 March 2006 Operating Agent’s report IEA Environmental Projects Limited on behalf of the Operating Agents submits the annual report and the accounts for the IEA Greenhouse Gas R&D Programme for the period ended 31 March 2006 Principal activity The IEA Greenhouse Gas R&D Programme, supported by seventeen nations, the European Commission and fourteen industrial sponsors, assesses options for reducing greenhouse gas emissions from the burning of fossil fuels. Programme performance The surplus for the period ended 31 March 2006 amounted to £83,821 (year ended 30 March 2005 surplus of £126,939). IEA Environmental Projects Limited Board members The members of the Board of IEA Environmental Projects Limited as at 31 March 2006 were as follows: Mr J B Lott Dr J M Topper Dr E J Dorward King Auditors The Programme accounts are audited by HLB Vantis Audit Plc on an annual basis to ensure they have been prepared in accordance with Article 6 of the Implementing Agreement together with any specific instructions of the Executive Committee. By order of the Operating Agent Dr J M Topper Managing Director IEA Environmental Projects Limited

1


31 March 2006 Statement of responsibilities of the board of IEA Environmental Projects Limited The Implementing Agreement for the Programme requires the Operating Agent to prepare accounts for each financial year which give a true and fair view of the state of affairs of the Programme and of any excess or deficit of income over expenditure for that period. In preparing those accounts, the Operating Agent has: • selected suitable accounting policies and then applied them consistently; • made judgements and estimates that are reasonable and prudent; • stated whether applicable accounting standards have been followed, subject to any material

departures disclosed and explained in the accounts; • prepared accounts on the going concern basis unless it is inappropriate to presume that the

project will continue in business. The Operating Agent is responsible under the Rules of the Programme for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Programme and to enable them to ensure that the accounts comply with the Rules of the Programme. They have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Programme and to prevent and detect fraud and other irregularities.

2


31 March 2006 Report of the independent auditors to the members of the IEA Greenhouse Gas R&D Programme The financial statements of the IEA Greenhouse Gas R&D Programme for the year ended 31 March 2006 on pages 4 to 6 have been extracted from the financial statements of IEA Environmental Projects Limited. Responsibilities of the auditors This report is made solely to the members of the IEA Greenhouse Gas R&D Programme and our work has been undertaken so that we might state to those members whether, in our opinion, the financial statements of the Programme have been properly extracted and as such that they reflect the income and expenditure of the Programme for the year then ended and its position at the year end and for no other purpose. Opinion In our opinion the financial statements of the IEA Greenhouse Gas R&D Programme have been properly extracted and as such reflect the income and expenditure for the year ended 31 March 2006 and the position of the Programme at 31 March 2006. HLB Vantis Audit Plc Chartered Accountants & Registered Auditors The White Cottage 19 West Street EPSOM Surrey KT18 7BS

3


31 March 2006 Income and expenditure account for the period ended 31 March 2006 Year to

31 March 2006 Four months to 31

March 2005 £ £ £ £ Income Funding from partners 1,121,063 301,917 Interest on bank account 37,900 10,695 Other 32,051 26,546 _______ _______ 1,191,014 339,158 Expenditure Salaries and staff costs 359,896 116.267 Travel and subsistence 68,846 18,204 Technical studies 509,779 4,243 Communications (including publications)

65,243 39,169

Supplies and services 110,684 31,030 Foreign exchange losses and currency charges

(16,430) 10,868

Bad debts - (9,937) ________ ________ ________ ________ 1,098,018 209,844 ________ ________ Excess of income over expenditure for the year

92,996 129,314

Tax provision (9,175) (2,375) ________ ________ Surplus (deficit) for the year 83,821 126,939 ======= ====== Statement of movement on reserves £ £ Opening balance 459,099 332,160 Surplus/(deficit) for the year 83,821 126,939 Transferred (to)/from commitment provided for programme winding up at 30 November

-

________ ________ Member contributions not yet committed

542,920 459,099

======= ======= There were no recognised gains or losses in either the current or preceding years other than those disclosed in the income and expenditure account.

4


31 March 2006 Balance sheet as at 31 March 2006 Notes As at 31 March

2006 As at 31 March

2005 £ £ Current assets Debtors 2 825,594 574,559 Cash at bank and in hand 1,784,071 1,190,512 _________ _________ 2,609,665 1,765,071 Creditors: amounts falling due within one year

3 (1,779,123) (1,018,350)

_________ _________ 830,542 746,721 Provision for liabilities and charges

4 (287,622) (287,622)

_________ _________ 542,920 459,099 ======== ======= Reserves General reserve 542,920 459,099 ======= =======

5


31 March 2006 Notes (forming part of the accounts) 1 Accounting policies Basis of preparation These accounts are prepared in accordance with Article 6 of the Implementing Agreement together with any specific instructions as approved by the Executive Committee. Capital expenditure Capital expenditure incurred in respect of accommodation and equipment is expensed in the year of purchase. Programme completion An extension of the Programme to Phase 5 was agreed by the Members and commenced in November 2004. The estimated costs of completion and winding down of the Programme have been determined and approved by the IEA Environmental Projects Limited Board. 2 Debtors 2006 2005 £ £ Trade debtors 816,746 537,452 Other debtors 8,848 37,107 ________ _______ 825,594 574,559 ======= ======= 3 Creditors: amounts falling due within one year 2006 2005 £ £ Amount due to related parties 60,915 75,634 Other creditors 1,384,798 231.575 Corporation tax 6,800 - Accruals and deferred income 326,610 711,141 _______ _______ 1,779,123 1,018,350 ======= ======= 4 Provision for liabilities and charges The provision relates to the IEA Environmental Projects Limited Board’s estimate of the costs required to wind down the Programme if it came to a halt at 31 March 2006. The provision will be reviewed annually to ensure it is sufficient. Nevertheless the accounts have been prepared on a going concern basis.

6