German lawmakers have reached a compromise that in principle allows the underground storage of carbon dioxide, a technology known as carbon capture and storage, or CCS, a system considered crucial in making power generation from fossil-fuels such as coal more climate friendly, the upper house of parliament said late Wednesday.
First reactions from the energy industry, however, cast doubt on the effectiveness of the compromise, with concerns over whether the move will provide adequate incentives for investment in researching the technology. The agreement effectively halved the storage volumes set in a previous draft that was approved by the lower house but rejected by the upper house of parliament.
The compromise kept in place veto rights for the 16 federal states and lowered the maximum volumes of CO2 to be stored underground.
The European Union wants 12 demonstration plants built by 2020 and plans to support selected projects financially. It previously opened treaty violation proceedings against Germany for failing to implement a CCS directive.
The upper house of parliament, the Bundesrat, said in a written statement that the compromise foresees that each underground CO2 storage facility must not exceed a volume of 1.3 million tons per year. Overall, the maximum CO2 storage volume for the whole of Germany has been set at 4 million tons per year.
Wednesday's compromise, which still needs approval from both houses of parliament, keeps in place veto rights for the 16 German states, albeit with slightly eased wording that forces the states to prove there are "geological characteristics or other public interests" that speak against CCS.
Vattenfall Europe AG--a unit of Swedish state-owned Vattenfall AB that had planned a EUR1.5 billion CCS power plant in eastern Germany, but abandoned it last December citing a lack adequate legislation--Thursday welcomed the compromise.
The company added, however, that the compromise "unfortunately comes too late for our discontinued project".
Hildegard Mueller, head of Germany's main energy lobby group BDEW, also Thursday said she considers the agreement to be too little, too late.
"My personal feeling is that the agreement won't be enough for the companies to resume their abandoned projects," said Ms. Mueller.
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