CarbonNet - developing a commercial model for a CCS network in Australia

Sep 29 2013

CarbonNet is investigating the potential for a shared, large-scale CCS network in the Gippsland region, Victoria, Australia. By the Department of State Development, Business & Innovation, Victoria

How do you develop a commercial model for a government-led project when no precedent exists and a range of industries could be involved? 
This is the unusual challenge faced by the CarbonNet Project (CarbonNet); a challenge the project has developed a ‘bespoke’ solution for.
It is envisaged that the network will integrate the supply of a number of CO2 capture projects within the region and transport the CO2 via pipeline to offshore geological storage formations to be stored, permanently, deep underground. To develop and then gain acceptance for a new commercial model, CarbonNet’s solution is to engage with the market to develop a model that works for all parties. 
“CarbonNet is taking a structured two-stage market engagement approach - one that reflects the complexities of CCS - and the project - and is underpinned by a solid stakeholder engagement strategy,” says Project Director Richard Brookie.
“It’s important that we have a solid understanding of the market for the project to meet its underlying objectives.  Those objectives include scalable infrastructure to underpin the rollout and growth of a CCS network, to enable an emerging CCS industry to evolve once market conditions are supportive.”
Stage 1 of the market engagement, Industry Sounding, was conducted late last year. It sought to understand how other CCS projects, globally, are progressing and highlighted the need for continued engagement with the market to help inform the model. 
Stage 2, Industry Consultation, is in the pipeline. CarbonNet seeks to understand the needs of current and future potential users (CO2 emitters) of its network, and what is required for these parties to participate in the project.
A Request for Industry Submissions supporting document will be available as part of the Industry consultation, which will include meetings with some parties. 
“The Industry consultation will provide an opportunity to reinforce the Victorian and Australian Governments’ commitment to consider CCS and for CarbonNet’s investigation of a viable CCS network. That commitment is an important message for our target market, as it involves international participants unfamiliar with the potential of the Victorian industry,” Mr Brookie said.At the end of the Industry consultation, CarbonNet will have:
• A more informed understanding of the network’s potential users, and appetite for CCS
• Information and market views around commercial business models 
• An understanding of how different commercial options might impact private sector participation in CarbonNet.
More information
Organisations wishing to make enquiries about participating in the industry consultation can email : 


Department of State Development, Business & Innovation, Victoria

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