Capital Costs

The capital costs of CCUS projects can vary widely depending on the type of technology, the scale of the project, and the specific industrial application. Key factors influencing capital costs include:

1. The choice of capture technology significantly impacts capital costs. For instance, post-combustion capture systems tend to be more expensive than pre-combustion systems due to the need for additional equipment to separate CO2 from flue gases.

2. Building infrastructure for CO2 transport and storage, such as pipelines and storage facilities, adds to the capital costs. The cost of onshore pipeline transport in the United States ranges from USD 2-14 per tonne of CO2, while storage costs can vary widely depending on the geological conditions.

3. Larger projects benefit from economies of scale, reducing the per-unit cost of CO2 captured. Scaling up from pilot projects to commercial-scale facilities can significantly lower the levelized cost of capture.

Operational Costs

Operational costs for CCUS projects include the expenses associated with capturing, transporting, and storing CO2. These costs can be broken down into several components:

1. CO2 capture processes are energy-intensive, contributing to higher operational costs. For example, the energy required for solvent regeneration in post-combustion capture systems can be substantial.

2. Regular maintenance of capture equipment, pipelines, and storage facilities is necessary to ensure efficient operation and prevent leaks.

3. Continuous monitoring and verification are essential to ensure the integrity of CO2 storage sites and compliance with regulatory requirements. This includes seismic surveys, well logging, and pressure monitoring.

Potential Financial Incentives

 
To make CCUS economically viable, various financial incentives and policy measures can be implemented:

 
1. Placing a value on CO2 emissions through carbon pricing mechanisms, such as carbon taxes or cap-and-trade systems, can provide a strong economic incentive for CCUS deployment. For instance, a carbon price of USD 50-100 per tonne of CO2 can significantly improve the financial viability of CCUS projects.

2. In the United States, the 45Q tax credit provides financial incentives for CO2 capture and storage. The credit offers USD 35 per tonne of CO2 used for enhanced oil recovery (EOR) and USD 50 per tonne for CO2 stored in geological formations.

3. Governments can provide direct funding to support the capital and operational costs of CCUS projects. For example, the European Union’s Horizon 2020 program offers research and innovation funding for CCUS projects.

4. PPPs can help share the financial risk and cost of CCUS projects between the public and private sectors. Successful examples include the Petra Nova project in Texas, which was financed through a partnership between NRG Energy and the US Department of Energy.

5. Companies can generate revenue by selling carbon credits earned from capturing and storing CO2. Additionally, carbon bonds can be issued to raise capital for CCUS projects, providing investors with returns linked to the project’s carbon reduction performance.

Economic Viability and Future Prospects

 
The economic viability of CCUS technologies depends on several factors, including the cost of capture, transport, and storage, as well as the availability of financial incentives. Recent studies have shown that the cost of CO2 capture can range from USD 15-25 per tonne for industrial processes with concentrated CO2 streams to USD 40-120 per tonne for more dilute streams, such as those from power generation.

While the initial costs of CCUS projects can be high, ongoing research and technological advancements are expected to reduce these costs over time. Innovations in capture technologies, process optimization, and integration with renewable energy sources can enhance the efficiency and economic feasibility of CCUS.

In conclusion, the deployment of CCUS technologies involves significant capital and operational costs, but various financial incentives and innovative business models can help mitigate these expenses. As technology advances and supportive policies are implemented, CCUS is poised to play a crucial role in achieving global climate goals and transitioning to a low-carbon economy.