In line with the King Abdullah Petroleum Studies and Research Center’s (KAPSARC) goal to study the changes in the oil, gas and renewable energy industry, the center has published a new study outlining options for supply-side climate policies.
The authors of the study Paul Zakkour and Wolfgang Heidug researchers at KAPSARC recommend new policies for fossil fuel producers and oil exporters to mitigate climate changes caused by their products and to increase their commitment towards creating a low carbon world.
“Motivating oil-producing countries to use large-scale climate mitigation technologies such as carbon capture and storage (CCS) can help them preserve the value of their natural resource assets while fostering ambitious climate action aligned with the goal of the Paris Agreement,” according to KAPSARC’s study.
The study points three benefits for the oil producers from the supply-side climate policy which are :
- Providing support to diversify and decarbonize their economies,
- Increasing policy flexibility by assigning emissions reduction from CCS to decarbonized oil or value-added products (and thereby optimizing the value of CCS),
- Developing new industrial activities and new sources of revenue driven by climate action.
The study considers several strategic and economic factors like policies including the conditions under which such ambition could be proposed and the ability to balance the costs to oil importers.
The paper has explained several ways to value carbon storage and researchers suggest that it could bring a commercial market for transacting physical CO2 between capturers, shippers and storers, which can aid to open the potential of CCS without the need for excessive government intervention.
The study further suggests setting up an international certification system for geological carbon storage as an important step for supporting policy developments towards decarbonized fossil fuels.