Bioenergy with Carbon Capture and Storage (BECCS) has the potential to become a new industry with positive economic effects. If Sweden were to take advantage of the entire country's potential and collect and store 30 million tonnes of carbon dioxide (CO2) annually, it could create up to 28 000 direct and indirect new jobs and contribute SEK 24 billion to the Swedish economy, a new report finds.
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BECCS, the capture, and storage of biogenic carbon dioxide (CO2) generate the negative emissions needed to meet the Paris Agreement’s goal of counteracting climate change. Sweden has very good conditions for BECCS through a well-developed bioeconomy.
The potential in Sweden is significantly greater than the national need for negative emissions and this opens up the possibility for Swedish players to also contribute to the needs of other countries and companies.
To see what the economic effects are, Stockholm Exergi commissioned the Danish consulting company Implement Consulting Group to carry out a national economic study.
The result shows clear positive economic effects. Sweden now has the chance to build a new industry that is necessary for the climate and good for the economy, said Dr Fabian Levihn, Head of R&D at Stockholm Exergi.
The key findings of the study “The Economic Impacts of BECCS in Sweden” are:
- The Swedish Government’s investigation (SOU 2020: 4) shows a need for up to 10 million tonnes of BECCS to meet the Swedish net-zero target. BECCS increases the economic efficiency of climate change, which means an annual saving of SEK 10-80 billion per year to reach the target of zero carbon dioxide emissions in 2045. If, for example, the costs that the Swedish National Institute of Economic Research (NIER) has reported for the last emissions in the transport sector are assumed to be true, the higher savings of SEK 80 billion per year are achieved.
- Sweden has very good conditions for BECCS. The potential is much greater than the 10 million tonnes of CO2 that may be needed to achieve the Swedish climate goal. With the support of Article 6 of the Paris Agreement, Sweden can produce negative emissions of up to 20 million tonnes per year for third party countries that need to reduce emissions in hard-to-abate sectors with carbon capture and storage (CCS) but which lack suitable conditions to do so. According to Implement’s study, the value of this export service to the Swedish economy is over is SEK 18 billion per year.
- According to Implement’s calculations, building and operating the industrial venture with an annual volume of 30 million tonnes of permanent negative emissions through BECCS would lead to a total of 28 000 new jobs being created and at the same time contributing SEK 24 billion to Swedish GDP. If only the Swedish need for 10 million tonnes per year is realized, 6 700 jobs will still be created and the contribution to Swedish GDP will be almost SEK 6 billion.
Although investing in BECCS both increases the economic efficiency of climate change and can make a positive contribution to the Swedish economy, the results from the report also show challenges. Not least, the future need for engineers and other specialist skills is critical.
For Sweden to succeed in establishing an industry for BECCS, the government needs to continue on the path it has taken and ensure that the reverse auction receives sufficient resources and that it starts up on time. We cannot afford to lose pace and state support needs to come in at an early stage. The support from the government will be an investment for the future, ended Dr Fabian Levihn.
