Development of carbon capture, storage and utilisation technologies could contribute more than $80 billion to the Western Australian economy over 20 years, according to a new report by CCIWA.
The report, Capturing our Future: Why Carbon Capture is critical to Australia’s Energy Transition, lays out the key economic and environmental arguments for embracing carbon capture in Australia.
In the report, ‘Carbon Capture’ is used as a catch-all phrase to describe the process of removing carbon dioxide from the air before it reaches the atmosphere, trapping it and securely storing it in geological formations. The carbon dioxide can be stored permanently or repurposed for other uses.
The report found that while some small-scale projects were underway in Australia, the nation was lagging behind many economies leading the green transition when it came to adopting carbon capture.
CCIWA Chief Economist, Aaron Morey, said aside from the very clear environmental benefits in reducing the carbon footprint of heavy industry, carbon capture would deliver an economic dividend.
“Building on modelling from the WA Government in 2023, we believe carbon capture could deliver $79.5 billion in baseline economic benefits to the Western Australian economy between 2030 and 2050,” he said.
“This comes from the money companies would pay to store the carbon as well as the spending on infrastructure, transport and job creation.
“On top of this, we expect there would be significant revenue from future projects, tax revenue, construction and utilisation of the stored carbon dioxide.”
The model does not take into consideration the benefits that would flow from job creation, taxes, infrastructure spending and other potential flow-ons.
The report found that carbon capture plays a crucial role in the decarbonisation plans of other countries, including the USA, Denmark, Norway, Kenya and Italy.
Mr Morey said carbon capture should be recognised by the broader community to form a key part of Australia’s strategy to reduce emissions.
“Alongside investment in renewable energy sources, carbon capture is an important tool that countries can use to reduce the environmental impact of heavy industries in particular,” Mr Morey said.
“Industries like iron, steel, cement, alumina, aluminium, chemical processing, aviation and agriculture make up around 20% of Australia’s emissions.
“Those emissions are extremely hard to reduce, but these industries are essential to our economy and our way of life, so it’s vital we invest in ways to reduce their environmental impact.”
The report found that while other countries are powering ahead to develop the technology and skills needed to support large-scale carbon capture projects, a lack of political will at the national level has meant it remains in its infancy in Australia.
“There’s been a 57% increase in the number of carbon capture projects under construction globally since 2020, which indicates a clear shift in the thinking of both Governments and private investors,” Mr Morey said.
“Australia should be a leader in both long-term carbon storage as well as driving diverse applications of carbon capture across various industries.
“The West Australian Government is supportive of carbon capture but it’s time for decision-makers at the federal level to get behind the technology.
“Carbon capture can help to reduce the emissions from critical industries that can’t be reduced through other means, which is a key barrier to Australia achieving net zero.”
The report makes several recommendations for the state and federal governments, including the development of a robust approvals framework and support for industry investment.
