The Board of Directors of Swedish municipal energy utility Söderenergi AB has announced that it has decided to pause its ongoing bioenergy with carbon capture and storage (BECCS) project at the Igelsta biomass-fired combined heat and power (CHP) plant in Södertälje, citing excessive risk exposure and insufficient financing.
Since 2020, Söderenergi has been assessing the conditions for the capture and permanent storage of biogenic carbon dioxide (bioCO2) from its Igelsta CHP plant.
The BECCS project is entering an intense development phase, supported by comprehensive plans and analyses covering technical, logistical, and environmental aspects, which requires a significant investment.
The reason for pausing Söderenergi’s BECCS project is the high level of risk exposure and the lack of sufficient financing. The necessary conditions are not in place to justify the continued development and execution of the project, said Robert Tingvall, CEO of Söderenergi.
According to Söderenergi, recent developments show that several key issues remain unresolved.
The voluntary carbon credit market (VCM) in the Nordic region has not developed at the pace required, and Söderenergi assesses that the Swedish support scheme will not be sufficient for this investment.
While the Board’s decision means that ongoing work will be discontinued, and no new commitments will be entered into, Söderenergi will continue to monitor developments in this area.
Sweden’s extensive bio-based district heating sector offers the potential to establish a carbon capture industry to help address the global climate challenge.
Söderenergi, which is owned by the municipalities of Södertälje, Huddinge, and Botkyrka, will continue to focus on flexible and energy-efficient solutions with climate and environmental performance as central priorities.
Södertälje Municipality remains committed to our ambitious climate goals. However, we are operating in an uncertain environment and must make decisions that do not expose the municipality to excessive financial risk. At this stage, it is a responsible decision to pause the project, commented Boel Godner, Chair of Söderenergi’s Board of Directors and Chair of the Municipal Executive Board of Södertälje.
