Sunday, December 2, 2012

New Research Funding, Cost Analysis for UK CCS

The UK Department of Energy and Climate Change (DECC) is accelerating its push for expanded CCS in Britain.  As it continues to evaluate finalists in its £1 billion ($1.6 billion) CCS Commercialization Program funding competition (see Short List Announced in UK CCS Funding Competition, 11/1), DECC has announced the first winners in a separate, £125 million ($200.3 million) R&D funding program.  (Both programs are part of the larger CCS Roadmap policy unveiled last spring--see UK Relaunches CCS Policy, 4/16.)  Thirteen grants totaling £18.3 million ($29.3 million) were announced as part of the first, £20 million ($32 million) round of the R&D competition.  Several awards were made to projects focusing specifically on CO2 transport and storage, including a storage modeling project led by Cambridge University and monitoring technology development led by Premier Oil.  A final project is currently under negotiation.

At the same time, a CCS Cost Reduction Task Force established by DECC earlier this year has released an interim report on its initial findings.  The key finding of the Task Force is that "UK gas and coal power stations equipped with carbon capture, transport and storage have clear potential to be cost competitive with other forms of low-carbon power generation, delivering electricity at a levelised cost approaching £100/MWh [$160/MWh] by the early 2020s, and at a cost significantly below £100/MWh soon thereafter" (p. i).  This estimate is based on detailed analysis of multiple cost factors including transport and storage investments, improvements in capture technology, lower borrowing costs, and synergies with CO2-EOR.

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