Economics of CCS for coal plants: Impact of investment costs and efficiency on market diffusion in Europe

A-Tier
Journal: Energy Economics
Year: 2012
Volume: 34
Issue: 3
Pages: 850-863

Authors (2)

Score contribution per author:

2.011 = (α=2.01 / 2 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

In this paper, we analyze how the development of the carbon capture and storage (CCS) technology used in coal-fired power plants affects its market diffusion. Specifically, we (1) show the significant variance in expectations about the economics of commercial-grade CCS hard coal power plants observed in the literature; (2) analyze the impact of CCS economics on electricity generation costs; and (3) investigate the expected deployment of CCS in the European power sector, depending on the variance of two main factors, efficiency and investment cost, using the bottom-up electricity sector model HECTOR. Simulation results show that investment costs strongly influence the market deployment of coal-fired CCS power plants, leading to a share of 16% in European generation capacity by 2025 with the lowest observed investment costs of 1400€/kW, but only 2% with the highest of 3000€/kW. A variation of conversion efficiency between 37% and 44%, the minimum and maximum observed values, only leads to a 13–15% share variation of CCS-equipped power plants. These findings are robust for the Base Case with a CO2 price of 43€/t and also for sensitivities with 30 and 20€/t CO2, but with a lower effect, as the overall share of CCS is significantly reduced at these prices.

Technical Details

RePEc Handle
repec:eee:eneeco:v:34:y:2012:i:3:p:850-863
Journal Field
Energy
Author Count
2
Added to Database
2026-01-26