Scenarios for CCS deployment in the UK, : What can we learn from the ongoing energy debate?

Transcription

1 Scenarios for CCS deployment in the UK, : What can we learn from the ongoing energy debate? 26 th USAEE/IAEE North American Conference, Ann Arbor, 24 th -27 th Sept Hannah Chalmers and Jon Gibbins Energy Technology for Sustainable Development Group, Mechanical Eng. Dept.

2 Outline UK energy policy context CCS technology and applications Barriers to implementation Options/scenarios for deployment Conclusions

3 2003 UK Energy White Paper: Key Goals Put ourselves on a path to cut the UK s carbon dioxide emissions - the main contributor to global warming - by some 60% by about 2050, as recommended by the RCEP, with real progress by 2020 Maintain the reliability of energy supplies Promote competitive markets in the UK and beyond, helping to raise the rate of sustainable economic growth and to improve our productivity Ensure that every home is adequately and affordably heated. From DTI (2003) Our Energy Future Creating a Low Carbon Economy, White Paper, HMSO, Feb

4 UK Energy Policy Evolution : Environmental objectives remain important and security moves up the agenda. The role of competition is less clear. Environmental policy (climate change) : Energy White Paper development including response to RCEP (2000): climate change and competitive markets are amongst the priorities. Some security of supply concerns emerging. Energy security 1970s/early 1980s: miners strikes and oil shocks make energy security the prime objective of energy policy Competition policy 1990s: privitisation, privatisation, deregulation and dash for gas combined with secure supply changes energy policy priorities After Brough, M. (2006) In search of a lasting solution: the 2006 Energy Review Oxera Agenda, July 2006,

5 Changing Assumptions in UK Energy Policy Two cases from DTI energy projections scenario analysis Central GDP scenario, high energy prices 2006 Central energy prices, favouring gas coal gas oil nuclear renewables imports and pumped storage Increased energy price uncertainty Less reliance on demand-side measures Increased use of coal, partly security reasons

6 CO 2 Emissions and Fossil Fuel Use CARBON IN FOSSIL FUELS CARBON THAT CAN BE EMITTED TO ATMOSPHERE

7 CCS for Electricity Generation Fuel Air Power & Heat Flue CO CO2 separation 2 gas POST-COMBUSTION CAPTURE Fuel Air CO 2 Gasification or partial oxidation shift + CO2 separation O 2 Air separation H 2 Air Power & Heat N 2, O 2, H 2 O PRE-COMBUSTION CAPTURE CO2 dehydration, compression transport and storage Fuel CO Power & Heat 2 (with H 2 O) O 2 Air N Air separation 2 Recycle O 2 /CO 2 RECYCLE (OXYFUEL) COMBUSTION CAPTURE After Jordal, K. et. al. (2004) Oxyfuel combustion for coal-fired power generation with CO 2 capture opportunities and challenges Proceedings of 7th International Conference on Greenhouse Gas Control Technologies, to be published, available online at

8 CCS in Other Sectors Transport CO 2 capture for unconventional oil production Kick-start decarbonised energy vector economy? Biomass with CCS could offset air travel? Buildings Decarbonised electricity for heating or heat pumps Manage fuel use to maximise CO 2 captured Energy Intensive Industry Can have higher purity CO 2 in waste streams Extending Oil and Gas Activities Existing technology and skills should be transferred

9 CCS Implementation Proposed full-scale (~300 MWe and above) CCS projects Based on media reports, press releases and personal communication so indicative only! Company/ Project Name Fuel Plant output/cost Capture technology Start Progressive Energy, Teeside, UK Coal (petcoke) 800 MW (+ H2 to grid) ($1.5bn) IGCC + shift + precombustion 2009 BP/SSE DF1, Peterhead/Miller, Scotland Natural gas 350 MW, ($600M) Autothermal reformer + precombustion 2010 Powerfuel/Kuzbassrazrezugol Hatfield Colliery, UK Coal ~900 MW IGCC + shift + precombustion 2010 BP DF2, Carson, USA Petcoke 500 MW, ($1bn) IGCC + shift + precombustion 2011 Statoil/Shell, Draugen, Norway Natural gas 860 MW NGCC+ Post-combustion amine 2011 SaskPower, Saskatchewan Canada Lignite coal 300 MW PC+ Post-combustion or oxyfuel (to be determined Q3 2006) 2011 E.ON, Killingholme, Lincolnshire coast, UK Coal (+petcoke?) 450 MW ( 1bn) IGCC + shift + precombustion? (may be capture ready) 2011 Stanwell, Queensland, Australia Coal 275 MW IGCC + shift + precombustion 2012 Futuregen, USA Coal 275 MW IGCC + shift + precombustion 2012 RWE, Germany Germany Coal 450 MW (Є1bn) RWE, Tilbury, UK Coal ~500 MW ( 800m) IGCC + shift + precombustion 2014 PC (supercritical retrofit) + postcombustion (may be capture ready) 2016

10 Barriers for Commercial Deployment Need to establish whole CCS value chain and appropriate criteria for comparing options No long term framework to establish an appropriate value for CO 2 reductions Some technical issues, but mostly scale-up and integration of known technology for first plants Uncertainty over costs and risks should be reduced if series of large scale demos occurs Investors want to avoid making the wrong choice, also need to be robust to policy change

11 CCS uncertainty based on fuel and carbon prices Carbon Price ( /tonne CO 2 ) GAS GAS + CCS 3 p/kwh 4 p/kwh COAL + CCS COAL Gas price /GJ Discount rate of 10% Investment lifetime of 25 years 8000 hours operation per year Coal price, 1.4/GJ (net) CO 2 delivery pressure of 110 bar (and pipeline quality) Indicative cost of transport to offshore aquifer storage, 5.50 per tonne CO 2 stored From Gibbins, J. et al. (2006) Interim Results from the UK Carbon Capture and Storage Consortium Project Proc. 8 th International Conference on Greenhouse Gas Control Technologies, Trondheim, Norway, 19th-23rd June

12 Scenarios and Actions for Deployment Existing plants should be designed and built with CO 2 capture retrofit in mind (captureready) Need to understand synergies and conflicts with other technologies First-of-type projects could progress only if current cost/risk barrier can be overcome Learning-by-doing and other education needed Large scale deployment is critical for tech. development Engineers, geologists etc for project deployment General public, NGOs for project acceptance

13 Possible CCS Timing in Kyoto Phases Kyoto Phase 1 Some early deployment projects ? Kyoto Phase 2 Greater emphasis on technology More widespread CCS development & deployment CCS standard on some plants (e.g. coal to liquids)? Capture-ready standard on power plants Storage-ready for oil and gas projects 2018? ? Kyoto Phase 3 CCS becomes standard in Annex 1 countries? 2023? -? Kyoto Phase 4 CCS becomes standard in all countries?

14 Capture-Ready Principles Capture-ready not a substitute for capture, but limits exposure to future carbon constraints if taken seriously Flexible approach needed for capture-ready Show-stoppers must be avoided Space Connections Access to storage But significant expenditure not justified (or usually required)

15 Capture-Ready Options NGCC good capture-ready option if currently economic Can have retrofit coal+pre-com or gas+post-com No clear choice between IGCC and PC capture-ready depends on relative merits without capture relative merits with capture, particularly post-com costs Priority should be making pulverised coal capture-ready (easy but urgent) and building some IGCC and pulverised coal both with capture for learning by doing

16 Comparison Between PC and IGCC 1 USCPC industry standard without capture best efficiency, lowest capital cost IGCC without capture higher capital cost, availability issues USCPC with capture higher capital and operating costs no experience IGCC with capture lower capital and operating costs, lower efficiency (for lowest COE) some chemical plant/refinery experience

17 Comparison Between PC and IGCC water quench? Efficiency (%LHV) USCPF w ithout capture USCPF with postcombustion capture IGCC w ith capture USCPF w ith oxycombustion CoE assumes base load plant operation (85% load factor), 10% annual discount rate and 25 year plant operating life. Costs include compression to 110 bar but not transport and storage costs. From IEA GHG (2006) CO 2 capture as a factor in power station investment decisions, Report ,

18 Capture-Ready Plant Design Requirements Post-combustion ready (PC and NGCC) space for absorber (plus FGD if needed) suitable IP/LP crossover steam pressure allow for rapid technology changes Gasifier+Capture-ready NGCC gas turbine for H 2 space on site or pipeline to remote site? Capture-ready IGCC layout and space cannot integrate before and after capture, unless other uses for gas, steam, etc. Oxyfuel PC space for ASU, duct access, air heater & fan capacity

19 Conclusions Range of complementary techniques required to respond to evolving (and conflicting?) priorities Different CCS technologies could be appropriate in various applications Technology deployment will be determined by policy decisions Commercial deployment needs a value chain Immediate action should include first-of-type plants and current build made capture-ready

20 Acknowledgements The authors gratefully acknowledge financial support from the Research Councils TSEC programme for the UK Carbon Capture and Storage Consortium, to which they both belong, and to the DTI, BCURA, and IEA GHG for support for projects that have contributed to the background to this work. Discussions and advice from many colleagues on these projects is also much appreciated. The opinions and interpretations expressed in this paper are, however, entirely the responsibility of the authors. Further Information

21 Plant Flexibility Potential Synergies/Conflicts Part Load Perform. Biomass Co-combust Hydrogen Capture Penalty Shift Conventional coal N/A Conventional gas N/A Post-comb. capture for coal Pre-comb. capture for coal Oxyfuel

22 How much money is it worth spending now to save money when capture is being added? Net present value of capture cost saving Years before capture is added 5% IRR 10% IRR 15% IRR When uncertainty is taken into account future cost savings of 2:1-10:1 required i.e. Capital cost can be 2-10 times as much, if it is not incurred until capture is fitted

23 Appropriate Analysis for Energy Policy? Wide range of analysis has been carried out Scenarios modelling MARKAL Cost/benefit analysis Can have wide variability in results Technology availability Assumed economic factors Policy uncertainty Many methods can have useful input, but important to understand strengths/weaknesses