Final report for One North East And NEPIC 21/12/10 - The Carbon ...

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The case for a Tees CCS networkFinal Report£7/t CO 2 is expected as a cost of service for use of a common transport network with amaximum transported capacity of 22 Mt CO 2 /year. Table 5 presents a comparison of thenetwork options against the criteria introduced previously.Table 5 System performance criteria 75DescriptionMetricAnchorOnlySmall Medium LargeEnvironmentaleffectivenessFinanceabilityCosteffectivenessMtCO 2 /yrcapturedCombinedcapex forcapture,transport andstorageAveragecapture cost£/tCO 2abatedTransport£/t CO 2Storage£/t CO 25 14 22 26£650 m £1.8 bn £3.0 bn £4.2 bn£18 £25 £29 £36£12 £7.30 £7.40 £7.40£14 £13 £12 £12Flexibility andstabilityLead time /complexityTotal £/tCO 2abatedRatio of sitescapturingCO 2 : sitesnot capturingRatio of CO 2emissionscaptured:emissionsnot capturedNumber ofsourcesconnecting£44 £45 £48 £551:35 5:30 8:27 35:05:21 14:12 22:4 26:01 5 8 35In addition to a system-wide perspective, which averages costs, individual emitters will bekeen to understand their own costs for implementing CCS. The marginal abatement costcurve (Figure 13) below shows the CO 2 abatement potential from individual sites, ordered75 See Appendix for further details.30
The case for a Tees CCS networkFinal Reportin terms of increasing costs of service for full CCS (i.e. capture, transport and storage). 76 InFigure 13 each segment corresponds to an individual source. The height of each barreflects the unit cost assuming an integrated transport and storage network, whereas thewidth refers to the CO 2 saving. The area of an individual bar corresponds to the lifetimenet present cost for CCS for that emitter.Figure 13 CCS marginal abatement cost curve for a „Large‟ network of emitters inthe Tees Valley. Each bar corresponds to an individual emitter connected to acommon transport and storage network.Within the context of potentially large errors associated with estimates for the costs andCO 2 volumes that might be relevant in the period up to and beyond 2030, the shape of themarginal abatement cost curve shows that both CO 2 volumes decrease and costs increasegradually, with a step rise in costs occurring only after 7 sources are connected. Since theCCS costs are comparable to the wide range of expected CO 2 prices between 2020 and2030, it could be commercially viable to capture from all or none of the plants in the TeesValley based on the difference between the CCS price and the carbon price. 773.7 Conclusions on economic case for investment in CCSnetworksAssuming investors are minded to invest in developing CCS infrastructure, the decision onwhich transport network to pursue will reflect a trade-off between the priorities described inSection 3.1.76 The names of individual emitters have been withheld to protect commercial confidentiality agreements.77 If the cost of CCS or CO 2 is not borne by competing industries, then even if CCS is cheaper than the EUA priceit may still be unaffordable for individual business units. W. Jones (2010) Personal communication31
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Final report for One North East And NEPIC 21/12/10 - The Carbon ...

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