7th Cost Network Proceedings

Publication Overview

The 7th edition of the IEAGHG CCS Cost Network Workshop was hosted at the University of Groningen, Netherlands, on 12-13 April 2023. The purpose of the workshop was to share and discuss the most current information on the costs of carbon capture and storage (CCS) in various applications, as well as the outlook for future CCS costs and deployment. For the first time, this workshop also included a session on the direct capture of CO₂ from the atmosphere. The workshop also sought to identify other key issues or topics related to CCS costs that merit further discussion and study.

Publication Summary

• The cost of the full CCS value-chain is significantly influenced by geographical location, and the costs for heat and/or electricity. It was emphasised that within Europe, CCS projects lacking funding support struggle to present a positive business case. Additionally, the development of CO₂ infrastructure was identified as crucial for harnessing the full potential of CCS in the cement industry.
• The FEED for Mustang Station outlines a technically feasible design with a capital cost of USD 725 million. The cost per tonne of CO₂ at USD 3/MMBTU varies, ranging from USD 85 at 4% IRR with an 85% load factor to USD 166 at 10% IRR with a 52% load factor. Significant opportunities for improving performance and reducing costs include steam extraction from existing turbines, increasing absorber packing for more than 97% CO₂ removal, and expanding exchanger areas to lower natural gas usage.
• The detailed public FEED sets the groundwork for potential natural gas combined cycle (NGCC) or combined heat and power demonstrations (CHP), with ideal site characteristics including the availability of cooling water, steam extraction capability, low reliance on renewables, and a high load factor. 1
• Achieving over 1 Gtonne of carbon dioxide removal capacity requires early, significant CDR purchases, fair pricing, and long-term offtake agreements. It also necessitates government subsidies, clear policy frameworks, site development with adequate storage and renewable energy, advanced, cost-effective technology, supply chain optimisation and low-cost financing with sufficient third-party funding.
• To optimise storage and transport costs in CCS, hubs are essential due to the uneven distribution of sources and variable injectivity. A comprehensive evaluation of total transport and storage costs at hubs requires analysing various cost elements, including onshore and offshore pipelines, and shipping. Facilities required at loading and unloading locations will significantly impact total shipping cost.
• Further regional analyses are required to better understand where CCS might be most effective. While the IEA study suggests CCS viability is predominantly in emerging economies, a more detailed country-level analysis is necessary to fully evaluate the potential of CCS.
• To accelerate the advancement of CCUS, governments and industries should focus on four high-level priorities: creating favourable conditions for investment, targeting the development of industrial clusters with shared CO₂ infrastructure, identifying, and developing CO₂ storage solutions, and boosting innovation in key technologies.
• It is technically possible for both coal-fired and natural gas combined cycle power plants to reach net zero emissions with CCS, achieving about 400 ppm CO₂ in the exhaust gas. Solvent intercooling is crucial for high CO₂ capture efficiency, particularly in NGCC plants. When operating at high-capacity factors, both pulverised coal (PC) and NGCC plants can attain zero-emissions using CCS at competitive costs. However, at lower capacity factors, combining CCS with DAC could be more effective for full decarbonization, provided DAC costs align with current claims.
• For blue/green hydrogen, arguments about “the best” technology is currently a distraction. All possibilities should be welcomed that enable low-carbon production, moving away from “colours” and focus on carbon intensity (CI) scores. Further, building confidence across the value chain is key.
• In North America, the cost of transport and storage in CCUS projects ranges from USD 10/tonne to USD 100/tonne of CO₂ stored. Key challenges for onshore projects include liability management and perceived risks, which lead to uncertainties and can drive up costs. Opportunities for cost reduction lie in adopting more appropriate risk based MMV practices, transitioning midstream pipeline systems from ‘one-to-one’ to ‘many-to-many’ systems, implementing focused government regulations for open access and transparent tariffs, and coordinating infrastructure development. Improved policies and frameworks for risk discovery