The deployment of Carbon Capture and Storage (CCS) technology is widely seen as critical for decarbonising heavy industries such as cement and steel. However, the transport of captured carbon dioxide (CO2CO_2CO2) from industrial clusters to offshore geological storage sites requires a highly specialised pipeline network. Building parallel pipelines from different companies to the same offshore reservoirs would involve massive capital duplication.
Currently, transport infrastructure is designed around regional pipeline networks. Critics argue that allowing private developers to operate unregulated regional pipelines could lead to monopoly abuse, with high transport tariffs deterring industrial emitters from adopting CCS. Alternatively, some energy economists propose a model where the core pipeline network is operated as a state-regulated utility. Others suggest that while the main trunk pipeline is a monopoly, competition can be introduced at the edges, allowing private firms to competitively bid for the construction and operation of localized feeder pipelines connecting individual factories to the main trunk.
With reference to Extract A, paragraph 2, discuss whether the regional carbon dioxide transport pipeline network can be considered to operate as a natural monopoly.
