Carbon Capture and Storage Forum 2009 Making the UK a world leader in CCS technology

1. Carbon Capture and Storage Forum 2009Making the UK a world leader in CCS technology Nick Horler, CEO ScottishPower

2. The race to deliver CCS - 2007 The UK announces the CCS Demonstration Competition • Few projects globally • CCS relatively unknown • UK CCS Demonstration competition launched, 9 entrants • The UK is in a promising position to lead in a new technology 2007 2008 2009 2015 Delivering full chain commercial scale CCS We’re in a real race to deliver CCS PRE220_Nick Horler CCS Forum_v1_20091125

3. The race to deliver CCS - 2008 The UK Competition keeps the UK in the lead • 5 fully integrated projects globally • CCS competition launched in Canada. Combined efforts of Alberta Government and Canadian Government to fund 3 to 5 full scale demonstrations by 2015 • UK CCS competition down to 4 pre-qualifiers • The UK still holds a strong lead in developing CCS 2007 2008 2009 2015 Delivering full chain commercial scale CCS We’re in a real race to deliver CCS PRE220_Nick Horler CCS Forum_v1_20091120

4. The race to deliver CCS - today The UK’s lead in CCS is slipping • 70 projects in planning or underway • Canada has named 2 full scale projects to be operational by 2015. More is expected • The Mountaineer pilot demonstration has kicked-off. Full scale is expected by 2015 • First fully integrated project in Lacq, France expected • Australia has committed over 2 billion Australian dollars to fund up to 20 projects by 2020 • UK CCS competition is down to 2 2007 2008 2009 2015 Delivering full chain commercial scale CCS We’re in a real race to deliver CCS PRE220_Nick Horler CCS Forum_v1_20091120

5. Lacq, France Full chain CCS pilot Claiming to be first full chain CCS pilot demonstration. 30MW capture, transport and storage. 120,000 tonnes of CO2 over a 2 year testing period. Transport via existing 27km pipeline; storage in depleted onshore gas reservoir. Prove 50% CO2 capture from oxy-combustion, reduce capture cost 50%. Source, Total Delay in storing capture CO2. Not yet storing capture CO2 PRE220_Nick Horler CCS Forum_v1_20091120

6. Capture and storage – Mountaineer, US Small scale retrofit up-and-running 1300MW existing coal power station. 20MW capture plant commissioned, capturing over 100,000 tonnes per year. 12 to 18 month testing period. CO2 is injected into saline aquifer 2,700 metres below power station. Full scale (235MW) by 2015, capturing 1.5 million tonnes of CO2 per year. Construction of Mountaineer pilot plant Source, Alstom Power Application for $334 million – about half of the estimated cost of full scale. Full scale by 2015 PRE220_Nick Horler CCS Forum_v1_20091120

7. Canada – taking the lead? Fast tracking CCS development Combined efforts of Canadian Federal Government and Alberta Government. Ambition to fund 3 to 5 full demonstrations by 2015. Competition launched in July 2008, 3.5 Canadian dollars put forward. Over 1.6 billion Canadian dollars already committed to 2 projects. Shell’s Quest Project (oil) & TransAlta’s Project Pioneer (coal new build). Construction of Project Pioneeer Source, TransAlta 1 more is expected by the end of 2009. 3 full scale demonstrations by 2015 PRE220_Nick Horler CCS Forum_v1_20091120

8. The UK World’s first full scale CCS demonstration Clean coal technology valued at £2-4Bn by 2030. Central North Sea 60,000 jobs in clean coal sector by 2030. UK CCS Competition down to final 2. FEED study worth up to £90m to be announced early next year. Longannet Funding mechanism – CCS Incentive established within Coal Policy Framework. SP consortium bid able to deliver commercial scale full chain CCS by 2014. A viable scheme capable of delivery by 2014 PRE220_Nick Horler CCS Forum_v1_20091120

9. We are demonstrating on coal, which is essential to UK and global security of supply • Our retrofit solution can be applied to the tens of thousands of power stations operational right now and is essential if we are to avoid carbon ‘lock-in’ • Longannet is situated close to the Central North Sea’s proven CO2 storage sites • There will be a ready made skills base left over from the UK’s illustrious oil and gas industry • Our world class knowledge transfer scheme will be driven by Accenture • Sharing what we learn - www.scottishpowerccs.tv/ • We have achieved a significant breakthrough in our testing programme at Longannet that will substantially reduce the CCS ‘energy penalty’ Our credentials… The ScottishPower option PRE220_Nick Horler CCS Forum_v1_20091120

10. The Mobile Test Unit (MTU) Bringing CCS out of the laboratory and into reality… A cutting edge carbon capture research facility. Tests the complex chemistry in capturing CO2 from power stations. Exact small-scale replica of a commercial capture plant. First time it has been fitted to a coal-fired power station. A 7 month testing programme that has been capturing CO2 for over 2000 hours. The programme has achieved an energy reduction of 30%. Essential step to achieving capture plant operating cost certainty

11. We are demonstrating on coal, which is essential to UK and global security of supply • Our retrofit solution can be applied to the tens of thousands of power stations operational right now and is essential if we are to avoid carbon ‘lock-in’ • Longannet is situated close to the Central North Sea’s proven CO2 storage sites • There will be a ready made skills base left over from the UK’s illustrious oil and gas industry • Our world class knowledge transfer scheme will be driven by Accenture • Sharing what we learn - www.scottishpowerccs.tv/ • We have achieved a significant breakthrough in our testing programme at Longannet that will substantially reduce the CCS ‘energy penalty’ • By demonstrating at Longannet, the second largest power station in the UK will remain operational beyond the end of the next decade Our credentials… The ScottishPower option PRE220_Nick Horler CCS Forum_v1_20091120

12. A Vision of the Future An integrated capture, transport and storage network for Europe Scotland has unique natural CO2 storage sites PRE220_Nick Horler CCS Forum_v1_20091120

13. Carbon Capture and Storage Forum 2009Making the UK a world leader in CCS technology Nick Horler, CEO ScottishPower