CO2 Storage and Sink Enhancements: Developing Comparable Economics

Abstract

To plan for potential CO2 mitigation mandates, utilities need better cost information on CO2 mitigation options, especially storage and sink enhancement options that involve non-utility operations. One of the major difficulties in evaluating CO2 storage and sink enhancement options is obtaining consistent, transparent, accurate, and comparable economics. This chapter presents a project that compares the economics of major technologies and practices under development for CO2 storage and sink enhancement, including options for storing captured CO2, such as active oil reservoirs, depleted oil and gas reservoirs, deep aquifers, coal beds, and oceans, as well as the enhancement of biological sinks such as forests and croplands. For the geologic and ocean storage options, CO2 capture costs from another project were added to the costs of CO2 storage estimated in this project to provide combined costs of CO2 capture and storage. Combined costs of CO2 capture and storage were compared with CO2 sink enhancement costs on a life-cycle greenhouse gas (GHG) avoided basis. The CO2 storage and sink enhancement options compared in this project differ greatly in the timing and permanence of CO2 sequestration. In addressing the timing and permanence issue, a 100-year planning horizon was assumed and the net present value of both costs and revenues was considered. The methods for comparing the economics of diverse CO2 storage and sink enhancement options have been overviewed and representative base-case costs of storage and sink enhancement options have been compared in the chapter.