Synthetic Fuel Hinges on Carbon Storage Solution

From The Australian:

SYNTHETIC fuels heralded by the Rudd Government as playing a "major role" in the nation's future energy security are not viable without yet-to-be-proven technology to capture the carbon produced and store it underground, Resources Minister Martin Ferguson has said. Mr Ferguson has talked up the importance of converting Australia's abundant coal and gas reserves to desperately needed transport fuels using coal-to-liquids and gas-to-liquids technologies, but has now revealed the greenhouse gases produced by the processes mean they are contingent on the success of carbon capture and storage. He has suggested the Government could consider new tax breaks to encourage the development of the synthetic fuel technologies, through the review of the taxation system headed by Treasury secretary Ken Henry and a special "action agenda" being developed by Mr Ferguson's resources department. But at present, in most cases the technologies emit almost twice the carbon dioxide of thenormal processes to produce diesel fuel. With Australia committed to reducing its greenhouse emissions and about to put a price on carbon through an emissions trading scheme, Mr Ferguson has told The Australian that the future ofsynthetic fuels is "absolutely interrelated with the successful development of carbon capture and storage over the next five to 10 years".

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