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Carbon Capture and Storage and the Location of Industrial

Facilities

Jeff Bielicki

Research FellowEnergy Technology Innovation Project

Belfer Center for Science and International AffairsHarvard University

Presentation at Research Experience in Carbon Sequestration 2007Montana State University, August 2, 2007

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What does CCS do?

• Couples industrial organization with geologic organization.– CO2 transport and storage requirements add

additional costs.• CO2 transport and storage costs introduce a

spatial ‘tax’.– Costs depend on the distance that CO2 must be

transported.• This presentation addresses how the economies

of scale for CO2 transportation interact with those of shipping coal and transmitting electricity.

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CO2 Transport and Storage

• Cost model balances CO2 pressure from storage reservoir back to source.– Includes all fixed and variable costs

• Composed of:– Pipeline transportation– Compression/Pressurization– Injection

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Existing U.S. PipelinesExisting CO2 Pipelines in the United States

L

(mi)

D

(in)

Capacity

(MMSCFD)

ROT

(kt/(yr*m2))

Canyon Reef Carriers 140 16 240 35,725

20 300 28,580

Cortez 502 30 1000 42,341

4000 169,364

McElmo Creek 40 8 60 35,725

Bravo 218 20 382 36,392

Transpetco/Bravo 120 12.75 175 41,022

Sheep Mountain 184 20 330 31,438

224 24 480 31,755

Central Basin 140 16 600 89,313

26 1200 67,645

Este 119 12.00 150 39,694

250 48,605

West Texas 127 8 100 59,542

12 26,463

Llano Lateral 53 8 100 59,542

12 26,463Sources: Map created from data provided by US Office of Pipeline Safety (2003); CO2 pipeline data collected from Oil & Gas Journal and operator websites.

2/1

000,112

COm

D CO2 mass flow rate in kt/yr.

Diameter in meters.

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Pipeline CO2 Transportation

• US Pipeline Construction Data– Onshore pipelines– Oil & Gas Journal, 1990-2005.

Regression:$ = 1,686,630∙1.0541 YR∙D0.9685∙L0.7315

• Using CO2 Pipeline Flowrates

$ = 0.3778∙1.0541YR∙m1.4685∙L0.7315

Pipeline Construction Costs: 1990-2005

Coefficient Cost ($)

Year – 1990

(YR)

0.0526***

(0.0040)

Ln(D) 0.0969***

(0.034)

Ln(L 0.732***

(0.012)

Constant 14.338***

(0.049)

Obs. 1052

Adj. R2 0.87

Standard errors in parentheses: ***p<0.01

Length in km.

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Transporting CO2

• Compression and Pressurization:– Compression from gas to liquid.1

– Pressurization as liquid.• Pressurization at source – Pressure drop = 10 MPa at

storage site.

– Compression/Pressurization equipment costs.2

1000,1

1

0

102

kk

cpCOc P

PTCmMW

1Assumes CO2 is an ideal gas. 2Based on IEAGHG (2003).

252 1000

81

pp D

fmLMW

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Storing CO2

• Injection:– Estimated costs to drill/equip/rework

wells1

– Flow/number of wells based on parameters from In Salah and SACROC.

– Injection Resistance Pressure:• Hydrostatic: Pres = (H2O-CO2)gh

• Dynamic:

n

k

r

t

bkmP COCO 2

25.2ln

1

4

122

1Sources: JAS (2000), O & G Journal

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Shipping Coal• Prices paid for 22,000+ shipments of coal in

US, 79 –01.1

– Shipped from a number of basins by a variety of means: rail, barge, truck, slurry…

– Analysis limited to approximately 4,000 records for single mode rail transportation in the “middle” states.

• 1990 Clean Air Act Amendments made coal from Powder River Basin attractive.

Mean Coal Content

PDR Not PDR

BTU 8,938

(634.9)

12,311

(902.9)

Sulfur 0.4222

(0.3062)

1.352

(0.8137)

Ash 5.761

(1.921)

9.683

(2.235)

Moisture 21.54

(10.67)

6.255

(4.329)

Standard deviation in parentheses.

1EIA (2005)

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Note(s) on Shipping via Railroad

• 1979 Staggers Act deregulated railroads.– 1980: 22 companies

operating rail lines.– 2007: 5 control 95% of

lines.

• 1990 Clean Air Act Amendments– Congestion out of

Powder River Basin.

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Coal Shipment Costs

• Four Interaction Models:1, 2

– Two functional forms– Two cost structures for distance

• Powder River Basin coal significantly cheaper.

DISMASHSBTUYRt RR 121086420/$ 1210864

20/$ DISMASHSBTUt RRYR

1Powder River Basin dummy variables not shown (odd-numbered coefficients). 2Distance structures differentiated by whether or not 13 and 13 are estimated.

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Case Study: Coal to Liquids Plant

• Coal gasification for synthesis gas: CO2+H2

• Fischer-Tropsch:

• 2.5 bbl oil and 1.7 tonnes CO2 from 1 tonne coal.1

• Economies of scale unclear.– Assume size relative to SASOL plant (150,000 bbl/d)

)(2)(2)(2)(22 glgg COCHHCO

1Assuming 75% efficient gasifier (Argrawal et al, 2007).

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CTL Plant: CO2 vs. Coal

• Example:– Powder River Basin coal, power model, same

cost structure, SASOL-sized plant.1

1 $70/MWh; 5%, 50 years.

Bold points indicate cost-minimized location

CCS transport and storage costs relocate CTL plants…

but only so much.

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Power Plant

• ‘Typical’ PC Power Plant1

– Uses approximately 9.6 kg/s coal per MW

– Produces approximately 4.7 kg/s CO2 per MW

1Full load, 37% efficiency

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Power Plant: CO2 or Coal?

• Should we transport CO2 or ship coal?

• CCS pulls power plants away from coal mines and towards storage sites.

• The tug weakens as the distance between the coal mine and the storage site decreases.

• No significant impact for small distances and power plants.

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Transmitting Electricity

• Transmission lines:– Discrete voltage

ratings.– Capacity degrades

over distance.– Losses depend on

distance, diameter, material, impedence…

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Electricity Transmission Costs

• Model chooses minimum required design.1

• E.g. Low load requires smaller diameter/lower capacity (kV) line. But losses increase.

• Hence the different slopes

Different line designs

1Based on IEAGHG (2003).

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CO2 or Electricity?

• Should we transport CO2 or transmit electricity?

Storage Site

CONCLUSION: Build power plant close to demand and transport CO2…

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But… Part of the Grid Exists

• The ‘tug’ of CCS transportation and storage depends on:– Plant size/output.– Distance between

demand and storage.– Amount of grid

infrastructure to be built.

• Transition at about 30±10% transmission investment.

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Economies of Scale

• This presentation focused on the ‘tug’ that CCS exerts on the location of facilities:– Significant enough to make existing facilities

wish they were somewhere else.– Scale of production is important.

• How do the economies of scale of CO2 transportation and interact with the economies of scale of e- and CO2 co-production and capture?

– Distance to storage site important.

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Next Steps

• Spatial Triangulation of Locations…

• … including Spatial Optimization for Pipeline Routing:

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