| Focus on the USA


by its concentration in the emissions stream. For example, fermentation processes at ethanol plants produce a highly pure CO2


stream that’s


relatively inexpensive to capture compared to CO2


from a gas- or coal-fired power plant. In the power generation cases, the fuels are burned in the air, which is mostly non-combustible nitrogen, so the flue gas is also mostly nitrogen. Removing the dilute CO2


from the flue gas requires more


equipment and entails higher operating costs. The table, right (source: Clean Air Task Force), shows estimates of CCS costs for various industries.


CCS with underground storage of CO2 is


generally considered to have three stages: capture, transportation, and storage. According to a recent National Petroleum Council report, titled Meeting the dual challenge – a roadmap to at-scale deployment of carbon capture, use, and storage, the costs associated with each stage of the CCUS process are dependent on site-specific circumstances that vary with each


project. For example, capture costs vary with CO2 concentrations as noted above, while transport costs vary based on the value, distance, and terrain over which CO2


is transported. Storage


costs also vary depending on the location, depth, and nature of the storage formation. In its analysis, the NPC assessed the costs of capturing, transporting, and storing CO2


from 80% of the largest US stationary sources (see graph below). As of 2019, there were ten large-scale CCUS projects operating in the USA


that had captured and stored about 160 million metric tons of CO2


up to that time, according to


the NPC, citing data from the Global CCS Institute. The NPC presented its results as a CO2


cost


curve where the total cost to capture, transport, and store one metric ton of CO2


sources is plotted against the volume of CO2 abatement it could provide (see graph). As


emissions


explained in the NPC report, the costs for individual projects “will vary based on location factors and the economic assumptions specific to each project.” Using the NPC study as a guide, it seems likely that the increased level of tax credits in the IRA will lead to a significant increase in CCUS deployment. Nevertheless, the NPC cost curve also shows that credits of $85/ton still leave the vast majority of stationary source CO2


emissions out of reach.


If CCUS is to mitigate these emissions, its costs will need to decline or the credits will need to be


CCUS cost estimates for various industries from stationary


increased. It may be that the government’s logic is to provide enough incentives to address the lowest-cost emissions reduction opportunities first, rather than waste money by setting the credit at a level that is much greater than needed to incentivise carbon capture deployment. As these low-cost sources are addressed, we may see the credits increased in future years for new CCUS installations that capture the high-cost emissions. In summary, the tax credits contained in the IRA are a significant step forward in the deployment of carbon capture and sequestration


technologies as a means to reduce CO2 emissions. Previous tax credit levels were sufficient to have only incentivised a handful of domestic carbon capture projects, but the new credit amounts and the reduction in the qualifying facility size should encourage the development of several new, economically viable installations.


CCS cost estimates for various industries Industry


Ethanol Ammonia


Gas processing Cement


Refineries Steel


Petrochemicals Hydrogen


Gas fuelled power plant Coal fuelled power plant


15-21 11-16 40-75 43-68 55-64 57-60 36-57 54-63 46-60


Capture ($/tonne)1 12-30


Transport and storage ($/tonne)2


25 25 25 25 25 25 25 25 25 25


1 Transport infrastructure for CCS, Great Plains Institute and Wyoming University, 2020  CATF national estimate used in this analysis. Low could be $3-40 per tonne


Total CCS ($/tonne) 37-55


40-46 36-41


65-100 68-93 80-89 82-85 61-82 79-88 71-85


US CCS cost curve. Cost of CCS (per tonne of CO2


emitted by that point source. Width of bars corresponds to amount of CO2


) for each stationary point source emitter in the USA is plotted against amount of CO2 emitted. Includes largest 80% of US stationary point source


emitters Source: National Petroleum Council, Meeting the dual challenge: a roadmap to at-scale deployment of carbon capture, use, and storage www.modernpowersystems.com | November/December 2022 | 21


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