Carbon Capture and Storage (CCS)
CCS is still an immature technology, and there are various capture technologies under development. There are four different carbon capture and storage technologies available within the model; retrofit CCS for existing coal power plants, retrofit CCS for existing gas power plants, greenfield CCS coal power plants and greenfield CCS gas power plants. The greenfield plants are new gas and coal power plants complete with CCS. The investment costs of the two retrofit options are based on the CCS technology being retrofitted to an already existing power plant, and the initial cost of the power plant is considered sunk. The costs of greenfield gas and greenfield coal plants are taken from ZEP (2011b). For the retrofit solutions for natural gas and coal, IEA GHG (2011) has been used. It is assumed that the investment costs for all four CCS technologies fall with 0.5 % per anno towards 2030 due to learning effects.
These costs do not cover the second stage of the CCS process where the CO2 is transported from the capture site to the storage facility. Transportation costs for CO2 are taken from ZEP (2011a) and based on the CO2 being transported through pipelines. The unit transportation costs for CO2/tonne vary with distance and whether it is an onshore or offshore pipeline. A cost of 6 €/tCO2 for transportation has been used, based on a 500 km offshore pipeline with a typical annual capacity of 20 Mt.
Storage costs depend on factors like field capacity, well injection rate and type of reservoir, and are thought to vary considerably between sites. ZEP (2011a) provides low, medium and high cost scenarios for storage depending on type of well (depleted oil and gas field or saline aquifer) and whether it is located onshore or offshore. In Europe there is more offshore than onshore capacity, and more capacity in saline aquifers than in depleted oil and gas fields (ZEP 2011a). This means that the majority of the potential European storage sites are of the most expensive kind. There has also been public resistance to storage onshore near where people live due to the risk of leakages. Taking this into consideration a storage cost of 10 €/tCO2 is used, which is based on depleted offshore oil and gas fields in ZEP’s medium cost scenario.
Due to the carbon capture, CCS plants will incur an efficiency penalty compared to power plants without CCS. Whether the plant is a new greenfield unit or an old plant with retrofitted CCS will have an impact, however most of the literature assumes that there is little difference in the actual efficiency penalty between greenfield plants and plants that are retrofitted. The difference in actual efficiency can mainly be attributed to how older existing plants that are candidates for being retrofitted have a lower efficiency than a newly built plant made specifically for CCS. The reduction in efficiency for retrofits is plant specific, and the plants’ efficiency will fall and costs increase depending on to what degree it is suitable for CCS (IEA 2007). In the model the efficiency penalty for natural gas plants (greenfield and retrofit) is an 8 percentage points reduction in efficiency, and likewise a 9 percentage point penalty for coal power plants.