Norway Scraps Mongstad

The outgoing government of Norway has halted carbon capture operations at the Mongstad CCS demonstration facility, which opened to great fanfare just last year (see More on Mongstad, 6/1/12).  Cost overruns and schedule delays were given as the reasons.  "At both the national and international level, the development of technologies to capture and store CO2 has taken longer, been more difficult and costly than expected," said Oil and Energy Minister Ola Borten Moe.  Mongstad's closing serves to underline the point that, absent a significant price on carbon, the business case for CCS is very weak, and demonstration and deployment will likely continue at an anemic pace.  Performance standards, as laid out in new and upcoming EPA regulations on power plant carbon emissions, offer a promising (if blunt) way around this enduring market failure.