Technologies and Costs of CO 2 Sequestration

1. Technologies and Costs of CO2 Sequestration Jacek Podkanski, Dolf Gielen International Energy Agency Policy and Strategy of Sustainable Energy Development for Central and Eastern European Countries until 2030 Warsaw, Poland, 22-23 November 2005

2. Carbon Capture & StorageResearch, Development, Demonstration and Deployment • US: FutureGen • EU: Hypogen • Canadian Clean Power Coalition • Australia • Germany: COORETEC • UK • Norway • France • Italy • Japan,… • Carbon Sequestration Leadership Forum • International Energy Agency • Intergovernmental Panel on Climate Change (IPCC) • World Energy Council • Bilateral Agreements, … National Programs International Collaboration • Alstom ExxonMobil • BP EniTecnologie SpA • ChevronTexaco • EPRI Shell International • RWE AG Total • Rio Tinto, Schlumberger,… Industry

3. Carbon Capture & Storage at the International Energy Agency • IEA Working Party on Fossil Fuels • IEA Greenhouse Gas R&D Programme • IEA Clean Coal Centre • IEA Coal Industry Advisory Board • Secretariat

4. Prospects for CO2 Capture and Storage • What is CO2 capture & storage? • What are the costs? • How does the cost-effectiveness of CCS compare to other emission reduction options? • What will it take to bring CO2 capture and storage to market?

5. What is CO2 capture & storage? • Capturing CO2 from the gas streams emitted during electricity production, industrial processes or fuel processing • Transporting the captured CO2 by pipeline or in tankers • Storing CO2 underground in deep saline aquifers, depleted oil and gas reservoirs or unminable coal seams

6. Capture – Technology Status • CO2 capture is a proven technology • It reduces emissions by 85-95% • But its energy efficiency can be further improved and cost must be reduced • This requires integrated power plant and CO2 capture designs • Most of these advanced designs are not yet proven on a commercial scale • Examples: new chemical absorbents, oxyfueling, hydrogen combined cycles, IGCC, USCSC, chemical looping, fuel cells

7. Capture - Opportunities • Fossil fueled power plants • Biomass fueled power plants • Certain industrial processes • Synfuels production • Natural gas processing

8. Storage – Technology Status • Aquifer storage: demonstration • CO2-EOR: demonstration • CO2-EGR: pilot • CO2-ECBM: pilot

9. Storage - Capacity • 1,000-10,000 Gt aquifer storage capacity • 100-120 Gt depleted oil fields/EOR • 700-800 Gt depleted gas fields/EGR • 20 Gt ECBM • Fixation mechanisms reduce risk • Monitoring is feasible and cheap

10. Costs - overview Capture (incl. compression) Current: 5 – 50 USD/tCO2 av. Future: 5 - 30 USD/tCO2 av. Coal-fired power plants 10 – 25 USD/tCO2 av. Gas-fired power plants 25 – 30 USD/tCO2 av. Transportation 2 – 20 USD/tCO2 av. Injection 2 – 50 USD/tCO2 av. Revenues -55 – 0 USD/tCO2 av. Total -40 – 100 USD/tCO2 av.

11. Capture (electricity)- adds presently 2-3 UScents/kWh- long term 1-2 UScents/kWh

12. Costs – general comments • CCS costs competitive with other CO2 abatement options • Coal without CCS has no future in a CO2-constrained world • Electricity from coal or gas-fired power plants with carbon capture and storage is still cheaper than most renewables (fuel price dependent) • Efficiency first

13. How does the cost-effectiveness of CCS compare to other emission reduction options?Scenario analysis • Scenarios produced using IEA’s Energy Technology Perspectives (ETP) model • Based on ETSAP-MARKAL • Systems engineering/partial equilibrium model • Global, 15-regions • Detailed representation of technologies on both the demand and supply sides (1500 new techs)

14. Model • Covers carbon capture and storage and competing emission mitigation options; • ETP BASE scenario calibrated with WEO Reference Scenario; • Detailed scenario analysis and sensitivity analysis to map cost-effective CCS potentials and uncertainties.

15. Global CO2 emissions

16. Emission stabilisationMarginal CO2 abatement cost

17. CO2 price

18. Capture at various CO2 prices

19. Share of CCS in total CO2 emissions mitigation

20. CO2 capture by process area

21. CO2 capture by technology

22. IGCC and steam cycles • Steam cycles and IGCC are competing options for coal-based electricity generation with CO2 capture and storage • Without synfuel cogeneration in IGCC installations the CCS potential declines by 30%

23. CO2 emissions from electricity generation

24. Electricity production mix

25. Electricity production by power plants fitted with CCS, by region

26. Fuel market implications:CCS impact on coal use at 50$/t CO2 CCS impact 2050: 50$/t CO2 results in 80% or 40% decline in coal use, depending on availability of CCS

27. Overview of sensitivity analysis results (influence on CO2 captured and stored in 2050)

28. Challenges • RD&D gaps • Public awareness and acceptance • Legal and regulatory framework • Long-term policy framework and incentives

29. RD&D gaps • More proof of storage needed • CO2 capture demonstration needed • 0.5-1 bln per demonstration plant • Present spending 100 MUSD/yr • A fivefold increase of RD&D needed

30. Long-term policy framework andincentives In addition to the acceleration of RD&D funding, countries should create a level-playing field for CCS alongside other climate change mitigation technologies. This includes ensuring that various climate change mitigation instruments, including market-oriented trading schemes, are adapted to include CCS.

31. Conclusions • CCS can play a key role in addressing global warming • mainly through coal plants in coal-rich regions • but also some natural gas opportunities • Carbon incentives are needed, but also: • Proven technology • Acceptable storage

32. Thank you jacek.podkanski@iea.org