Prospective Evaluation of Applied Energy Research and Development at DOE (Phase Two) (2007) / Chapter Skim
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Appendix I Report of the Panel on DOE's Carbon Sequestration Program
Appendix I Report of the Panel on DOE's Carbon Sequestration Program
Pages 132-151
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From page 132... ...
The earlier (Phase One) carbon tax would be imposed on emissions at $100 per ton evaluation of the carbon sequestration program was done as of carbon.1 The panel decided to evaluate another scenario part of the task of developing the methodology and consewherein the carbon tax was assumed to be $300 per ton.
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From page 133... ...
DOE established the carbon sequestration program in -- Preferential adsorption of CO2 onto coal and other 1997.2 The program, which is administered within the Office organic-rich reservoirs takes place as a function of reservoir of Fossil Energy (FE) by the National Energy Technology pressure.
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From page 134... ...
The systems and geologic formations are difficult to simulate, primary and overarching objective of the second stage will testing ideas in the field often enables significant learning and be to move forward with the high-priority tests to validate insight. Sequestration field tests serve as a test bed for CO2 sequestration technology that were identified in the first stage detection and measurement technologies and also present an of the effort.
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From page 135... ...
amine-based CO2 capture would be $77/MWh and, if using IGCC with Program Budgets a Selexol unit for carbon capture, $65/MWh. Both the cost The base sequestration program funding is roughly estimates include $5 per ton CO2 for geologic storage (Rao $55 million per year.
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From page 136... ...
for oxyfuels, is funded not percent for IGCC with sequestration compared with IGCC within the DOE carbon sequestration program but within its without sequestration. The analysis thus makes a misleading advanced gasification research program.
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From page 137... ...
municate to the surface. These reactions can be evaluated in the laboratory over relatively short time spans, but there is competing Technologies no known way in the laboratory to evaluate the reactions that might degrade the well bore seals over hundreds to thousands A high carbon tax will make zero-emissions or very low of years.
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From page 138... ...
Each of The main technological uncertainty considered was the these barriers would make successful deployment of seques- increase in the COE associated with the capture and storage tration less likely and would tend to favor some of the com- of carbon emissions from coal-fired power plants, specifipeting technologies as a way to meet carbon constraints: cally from advanced IGCC plants. DOE's R&D program as sumes that IGCC plants without CCS will be the cheapest • Public opposition based on the risk of sequestration.
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From page 139... ...
with and without DOE research. For example in 2017 with In the discussion of benefits below, the panel assumes that the $100 tax, the panel's average expected cost increase decisions about which technology to deploy are made with without DOE support is 28 percent versus 24 percent with knowledge of the carbon tax level -- $100 or $300 per ton DOE support.
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From page 140... ...
No Yes No Yes $300 tax $100 tax DOE Funding? No Yes No Yes 30% 20% Expected Increase in COE Associated with CSS 10% DOE COE Goal (10% Increase in COE)
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From page 141... ...
commitment to reducing emissions. This combination of optimistic as- The economic, environmental, and security benefits of sumptions with DOE support and pessimistic assumptions improvements in carbon sequestration technologies depend without DOE support leads DOE to arrive at a much higher on the degree of technical improvement, the amount of IGCC estimate of the benefits of its support than arrived at by the with carbon sequestration that is deployed, the technologies panel, although to be sure the panel assessments still show that would have been implemented absent carbon sequestraa high net payback.
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From page 142... ...
carbon emissions and the R&D in other nations. To estimate the COE for IGCC with carbon sequestration, To estimate the quantity of IGCC with carbon sequestrathe panel defined a range of possible technical outcomes of tion that would be built in each year under the cost scenarios carbon sequestration research in 2012, 2017, and 2022, as identified by the panel, a simple cost comparison was made described in the section on the decision tree model and proba- to determine which technology would be least costly for a bility assessment results.
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From page 143... ...
C, carbon; CCS, carbon capture and storage; COE, cost of electricity; /t, per ton.
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From page 144... ...
The value of the DOE oF The carBoN seQuesTraTioN ProGram research program is the difference between the expected value of carbon sequestration research with the program and Although higher than government R&D expenditures, the expected value without the program. the expected economic benefit of $3.5 billion given by this Figure I-8 illustrates the expected economic benefits of analysis is substantially less than the expected benefit of carbon sequestration R&D, as well as the uncertainty sur- $35 billion arrived at by the evaluation carried out in Phase One.11 The difference in results is primarily due to the much rounding those benefits.
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From page 145... ...
Carbon tax is assumed to be $100 per ton, increasing at 3 percent per year after 2012. C, carbon; CCS, carbon capture and storage; COE, cost of electricity; /t, per ton; IGCC, integrated gasification combined cycle.
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From page 146... ...
The two lines, "with DOE support" and "without DOE support," were calculated by determining the number of builds for each scenario given in Figure I-2 and taking the probability-weighted average. Additional lines are shown corresponding to the number of builds estimated assuming the highest and lowest COE estimates from Figure I-5.
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From page 147... ...
1.0 .9 .8 .7 .6 .5 .4 Expected value without DOE program = $6.6 billion Cumulative probability .3 .2 With DOE's program Expected value with DOE program = $10.1 billion .1 Without DOE's program .0 0 5 10 15 20 25 30 35 40 45 NPV in $ billion FIGURE I-8 Cumulative distribution on the NPV of the economic benefits of carbon sequestration research, with and without the DOE program. Expected values, with or without DOE research funding, were calculated as the probability-weighted average of the net present value of benefits in each cost scenario.
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From page 148... ...
The Benefits environmental benefit of DOE's carbon sequestration program depends on what technologies would be implemented if IGCC with sequestration does not become cost-competitive. Given the level of carbon tax in the scenarios evaluated, the least-cost alternatives to carbon sequestration are other zero-emissions technologies.
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From page 149... ...
Because the benefit of bon sequestration competitive with IGCC plants that vent the DOE research program is taken as the difference between their carbon. expected benefits with and without DOE support, improving • DOE's R&D program will speed the attainment of the the expected benefits of the technology without DOE support carbon sequestration program's R&D goals by about 3 years will decrease the estimated benefits of the program.
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From page 150... ...
He is an internationally recognized expert in improved of fossil fuels without atmospheric emissions of carbon oil recovery and greenhouse gas issues. He is the co-lead dioxide by means of carbon sequestration.
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From page 151... ...
He received a B.Sc. in chemistry- Decision Risk and Management Science program and has biology from Bishop's University, in Canada, an M.Sc in been departmental editor for decision analysis at the journal Agricultural Biochemistry from McGill University, and a Management Science.
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