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Figure 1.3 a) Schematic diagram of fossil-fuel-based power generation; b) Schematic diagram of post-combustion capture; c) Schematic diagram of pre-combustion capture; d) Schematic diagram of oxyfuel combustion

CO2. An alternative approach would be to reduce the emissions from dispersed sources by supplying them with an energy carrier with zero net CO2 emissions from use, such as biofuels, electricity or hydrogen (Johansson et al., 1993). Electricity or hydrogen12 from fossil fuels could be produced with CO2 capture and this would avoid most of the CO2 emissions at the production site (Audus et al., 1996). The cost, applicability and environmental aspects of various applications are discussed later in this report.

1.4.4 Scale of the plant

Some impression of the scale of the plant involved can be gained from considering a coal-fired power plant generating 500MW. This would emit approximately 2.9 MtCO2 per year (0.8 MtC per year) to atmosphere. A comparable plant with CO2 capture and storage, producing a similar amount of electricity and capturing 85% of the CO2 (after combustion) and compressing it for transportation, would emit 0.6 MtCO2 per year to the atmosphere (0.16 MtC per year), in other words 80% less than in the case without capture. The latter plant would also send 3.4 MtCO2 per year to storage (0.9 MtC per year). Because of its larger size, the amount of CO2 generated by the plant with capture and compression is more than the plant without capture (in this example 38% more). This is a result of the energy

12 Hydrogen is produced from fossil fuels today in oil refineries and other industrial processes.

requirements of the capture plant and of the CO2 compressor. The proportion of CO2 captured (85%) is a level readily achievable with current technology (this is discussed in Chapter 3); it is certainly feasible to capture a higher proportion and designs will vary from case to case. These figures demonstrate the scale of the operation of a CO2 capture plant and illustrate that capturing CO2 could achieve deep reductions in emissions from individual power plants and similar installations (IEA GHG, 2000a).

Given a plant of this scale, a pipeline of 300-400 mm diameter could handle the quantities of CO2 over distances of hundreds of kilometres without further compression; for longer distances, extra compression might be required to maintain pressure. Larger pipelines could carry the CO2 from several plants over longer distances at lower unit cost. Storage of CO2, for example by injection into a geological formation, would likely involve several million tonnes of CO2 per year but the precise amount will vary from site to site, as discussed in Chapters 5 and 6.

1.5 Assessing CCS in terms of environmental impact and cost

The purpose of this section and those that follow is to introduce some of the other issues which are potentially of interest to decision-makers when considering CCS. Answers to some of the questions posed may be found in subsequent chapters, although answers to others will depend on further work and local information. When looking at the use of CCS, important considerations will include the environmental and resource implications, as well as the cost. A systematic process of evaluation is needed which can examine all the stages of the CCS system in these respects and can be used for this and other mitigation options. A well-established method of analyzing environmental impacts in a systematic manner is the technique of Life Cycle Analysis (LCA). This is codified in the International Standard ISO 14040 (ISO, 1997). The first step required is the establishment of a system boundary, followed by a comparison of the system with CCS and a base case (reference system) without CCS. The difference will define the environmental impact of CCS. A similar approach will allow a systematic assessment of the resource and/or cost implications of CCS.

Fossil fuels -Other materials -

Industrial plant or process

- C02 emitted

- CO2 stored

- Other process emissions

^ j Useful product (e.g. electricity, V hydrogen, chemicals, fuels, etc.]

Figure 1.4 System boundary for a plant or process emitting CO2 (such as a power plant, a hydrogen production plant or other industrial process). The resource and environmental impacts of a CCS system are measured by the changes in total system input and output quantities needed to produce a unit of product.

1.5.1 Establishing a system boundary

A generic system boundary is shown in Figure 1.4, along with the flows of materials into and out of the system. The key flow13 is the product stream, which may be an energy product (such as electricity or heat), or another product with economic value such as hydrogen, cement, chemicals, fuels or other goods. In analyzing the environmental and resource implications of CCS, the convention used throughout this report is to normalize all of the system inputs and outputs to a unit quantity of product (e.g., electricity). As explained later, this concept is essential for establishing the effectiveness of this option: in this particular case, the total amount of CO2 produced is increased due to the additional equipment and operation of the CCS plant. In contrast, a simple parameter such as the amount of CO2 captured may be misleading.

Inputs to the process include the fossil fuels used to meet process energy requirements, as well as other materials used by the process (such as water, air, chemicals, or biomass used as a feedstock or energy source). These may involve renewable or non-renewable resources. Outputs to the environment include the CO2 stored and emitted, plus any other gaseous, liquid or solid emissions released to the atmosphere, water or land. Changes in other emissions - not just CO2 - may also

3 Referred to as the 'elementary flow' in life cycle analysis.

be important. Other aspects which may be relatively unique to CCS include the ability to keep the CO2 separate from the atmosphere and the possibility of unpredictable effects (the consequences of climate change, for example) but these are not quantifiable in an LCA.

Use of this procedure would enable a robust comparison of different CCS options. In order to compare a power plant with CCS with other ways of reducing CO2 emissions from electricity production (the use of renewable energy, for example), a broader system boundary may have to be considered.

1.5.2 Application to the assessment of environmental and resource impacts

The three main components of the CO2 capture, transport and storage system are illustrated in Figure 1.5 as sub-systems within the overall system boundary for a power plant with CCS. As a result of the additional requirements for operating the CCS equipment, the quantity of fuel and other material inputs needed to produce a unit of product (e.g., one MWh of electricity) is higher than in the base case without CCS and there will also be increases in some emissions and reductions in others. Specific details of the CCS sub-systems illustrated in Figure 1.5 are presented in Chapters 3-7, along with the quantification of CCS energy requirements, resource requirements and emissions.

1.5.3 Application to cost assessment

The cost of CO2 capture and storage is typically built up from three separate components: the cost of capture (including compression), transport costs and the cost of storage (including monitoring costs and, if necessary, remediation of any release). Any income from EOR (if applicable) would help to partially offset the costs, as would credits from an emissions trading system or from avoiding a carbon tax if these were to be introduced. The costs of individual components are discussed in Chapters 3 to 7; the costs of whole systems and alternative options are considered in Chapter 8. The confidence levels of cost estimates for technologies at different stages of development and commercialization are also discussed in those chapters.

There are various ways of expressing the cost data (Freund and Davison, 2002). One convention is to express the costs in terms of US$/tCO2 avoided, which has the important feature of taking into account the additional energy (and emissions) resulting from capturing the CO2. This is very important for understanding the full effects on the particular plant of capturing CO2, especially the increased use of energy. However, as a means of comparing mitigation options, this can be confusing since the answer depends on the base case chosen for the comparison (i.e., what is being avoided). Hence, for comparisons with other ways of supplying energy or services, the cost of systems with and without capture are best presented in terms of a unit of product such as the cost of generation (e.g., US$ MWh-1) coupled with the CO2 emissions per unit of electricity generated (e.g., tCO2 MWh-1). Users can then choose the appropriate base case best suited to their purposes. This is the approach

Figure 1.5 System components inside the boundary of Figure 1.4 for the case of a power plant with CO2 capture and storage. Solid arrows denote mass flows while dashed lines denote energy flows. The magnitude of each flow depends upon the type and design of each sub-system, so only some of the flows will be present or significant in any particular case. To compare a plant with CCS to another system with a similar product, for example a renewables-based power plant, a broader system boundary may have to be used.

Figure 1.5 System components inside the boundary of Figure 1.4 for the case of a power plant with CO2 capture and storage. Solid arrows denote mass flows while dashed lines denote energy flows. The magnitude of each flow depends upon the type and design of each sub-system, so only some of the flows will be present or significant in any particular case. To compare a plant with CCS to another system with a similar product, for example a renewables-based power plant, a broader system boundary may have to be used.

used in this report and it is consistent with the treatment of environmental implications described above.

Expressing the cost of mitigation in terms of US$/tCO2 avoided is also the approach used when considering mitigation options for a collection of plants (such as a national electricity system). This approach is typically found in integrated assessment modelling for policy-related purposes (see Chapter 8). The costs calculated in this way should not be compared with the cost of CO2-avoided calculated for an individual power plant of a particular design as described above because the base case will not be the same. However, because the term 'avoided' is used in both cases, there can be misunderstanding if a clear distinction is not made.

1.5.4 Other cost and environmental impact issues

Most of the published studies of specific projects look at particular CO2 sources and particular storage reservoirs. They are necessarily based on the costs for particular types of plants, so that the quantities of CO2 involved are typically only a few million tonnes per year. Although these are realistic quantities for the first projects of this kind, they fail to reflect the potential economies of scale which are likely if or when this technology is widely used for mitigation of climate change, which would result in the capture, transport and storage of much greater quantities of CO2. As a consequence of this greater use, reductions can be expected in costs as a result of both economies of scale and increased experience with the manufacture and operation of most stages of the CCS system. This will take place over a period of several decades. Such effects of 'learning' have been seen in many technologies, including energy technologies, although historically observed rates of improvement and cost reduction are quite variable and have not been accurately predicted for any specific technology (McDonald and Schrattenholzer, 2001).

The construction of any large plant will generate issues relating to environmental impact, which is why impact analyses are required in many countries before the approval of such projects. There will probably be a requirement for gaining a permit for the work. Chapters 3 to 7 discuss in more detail the environmental issues and impacts associated with CO2 capture, transport and storage. At a power plant, the impact will depend largely on the type of capture system employed and the extra energy required, with the latter increasing the flows of fuel and chemical reagents and some of the emissions associated with generating a megawatt hour of electricity. The construction and operation of CO2 pipelines will have a similar impact on the environment to that of the more familiar natural gas pipelines. The large-scale transportation and storage of CO2 could also be a potential hazard, if significant amounts were to escape (see Annex I).

The different storage options may involve different obligations in terms of monitoring and liability. The monitoring of CO2 flows will take place in all parts of the system for reasons of process control. It will also be necessary to monitor the systems to ensure that storage is safe and secure, to provide data for national inventories and to provide a basis for CO2 emissions trading.

In developing monitoring strategies, especially for reasons of regulatory compliance and verification, a key question is how long the monitoring must continue; clearly, monitoring will be needed throughout the injection phase but the frequency and extent of monitoring after injection has been completed still needs to be determined, and the organization(s) responsible for monitoring in the long term will have to be identified. In addition, when CO2 is used, for example, in enhanced oil recovery, it will be necessary to establish the net amount of CO2 stored. The extent to which the guidelines for reporting emissions already developed by IPCC need to be adapted for this new mitigation option is discussed in Chapter 9.

In order to help understand the nature of the risks, a distinction may usefully be drawn between the slow seepage of CO2 and potentially hazardous, larger and unintended releases caused by a rapid failure of some part of the system (see Annex I for information about the dangers of CO2 in certain circumstances). CO2 disperses readily in turbulent air but seepage from stores under land might have noticeable effects on local ecosystems depending on the amount released and the size of the area affected. In the sea, marine currents would quickly disperse any CO2 dissolved in seawater. CO2 seeping from a storage reservoir may intercept shallow aquifers or surface water bodies; if these are sources of drinking water, there could be direct consequences for human activity. There is considerable uncertainty about the potential local ecosystem damage that could arise from seepage of CO2 from underground reservoirs: small seepages may produce no detectable impact but it is known that relatively large releases from natural CO2 reservoirs can inflict measurable damage (Sorey et al., 1996). However, if the cumulative amount released from purposeful storage was significant, this could have an impact on the climate. In that case, national inventories would need to take this into account (as discussed in Chapter 9). The likely level of seepage from geological storage reservoirs is the subject of current research described in Chapter 5. Such environmental considerations form the basis for some of the legal barriers to storage of CO2 which are discussed in Chapters 5 and 6.

The environmental impact of CCS, as with any other energy system, can be expressed as an external cost (IPCC, 2001d) but relatively little has been done to apply this approach to CCS and so it is not discussed further in this report. The results of an application of this approach to CCS can be found in Audus and Freund (1997).

1.6 Assessing CCS in terms of energy supply and CO2 storage

Some of the first questions to be raised when the subject of CO2 capture and storage is mentioned are:

• Are there enough fossil fuels to make this worthwhile?

• How long will the CO2 remain in store?

• Is there sufficient storage capacity and how widely is it available?

These questions are closely related to the minimum time it is necessary to keep CO2 out of the atmosphere in order to mitigate climate change, and therefore to a fourth, overall, question: 'How long does the CO2 need to remain in store?' This section suggests an approach that can be used to answer these questions, ending with a discussion of broader issues relating to fossil fuels and other scenarios.

1.6.1 Fossil fuel availability fossil fuels, as would the introduction of CCS. At the same time, improved technology will reduce the cost of using these fuels. All but the last of these factors will have the effect of extending the life of the fossil fuel reserves, although the introduction of CCS would tend to push up demand for them.

1.6.1.2 Fossil fuel reserves and resources In addition to the known reserves, there are significant resources that, through technological advances and the willingness of society to pay more for them, may be converted into commercial fuels in the future. Furthermore, there are thought to be large amounts of non-conventional oil (e.g., heavy oil, tars sands, shales) and gas (e.g., methane hydrates). A quantification of these in the Third Assessment Report (IPCC, 2001a) showed that fully exploiting the known oil and natural gas resources (without any emission control), plus the use of non-conventional resources, would cause atmospheric concentrations of CO2 to rise above 750 ppmv. In addition, coal resources are even larger than those of oil and gas; consuming all of them would enable the global economy to emit 5 times as much CO2 as has been released since 1850 (5,200 GtCO2 or 1,500 GtC) (see Chapter 3 in IPCC, 2001a). A scenario for achieving significant reductions in emissions but without the use of CCS (Berk et al., 2001) demonstrates the extent to which a shift away from fossil fuels would be required to stabilize at 450 ppmv by 2100. Thus, sufficient fossil fuels exist for continued use for decades to come. This means that the availability of fossil fuels does not limit the potential application of CO2 capture and storage; CCS would provide a way of limiting the environmental impact of the continued use of fossil fuels.

Fossil fuels are globally traded commodities that are available to all countries. Although they may be used for much of the 21st century, the balance of the different fuels may change. CO2 capture and storage would enable countries, if they wish, to continue to include fossil fuels in their energy mix, even in the presence of severe restrictions on greenhouse gas emissions.

Whether fossil fuels will last long enough to justify the development and large-scale deployment of CO2 capture and storage depends on a number of factors, including their depletion rate, cost, and the composition of the fossil fuel resources and reserves.

1.6.1.1 Depletion rate and cost of use Proven coal, oil and natural gas reserves are finite, so consumption of these primary fuels can be expected to peak and then decline at some time in the future (IPCC, 2001a). However, predicting the pace at which use of fossil fuels will fall is far from simple because of the many different factors involved. Alternative sources of energy are being developed which will compete with fossil fuels, thereby extending the life of the reserves. Extracting fossil fuels from more difficult locations will increase the cost of supply, as will the use of feedstocks that require greater amounts of processing; the resultant increase in cost will also tend to reduce demand. Restrictions on emissions, whether by capping or tax, would also increase the cost of using

1.6.2 Is there sufficient storage capacity?

To achieve stabilization at 550 ppmv, the Third Assessment Report (IPCC, 2001e) showed that, by 2100, the reduction in emissions might have to be about 38 GtCO2 per year (10 GtC per year)14 compared to scenarios with no mitigation action. If CO2 capture and storage is to make a significant contribution towards reducing emissions, several hundreds or thousands of plants would need to be built, each capturing 1 to 5 MtCO2 per year (0.27-1.4 MtC per year). These figures are consistent with the numbers of plants built and operated by electricity companies and other manufacturing enterprises.

Initial estimates of the capacity of known storage reservoirs (IEA GHG, 2001; IPCC, 2001a) indicate that it is comparable to the amount of CO2 which would be produced for storage by such plants. More recent estimates are given in Chapters 5 and 6, although differences between the methods for estimating storage capacity demonstrate the uncertainties in these estimates; these issues are discussed in later chapters. Storage outside natural reservoirs, for example in artificial stores or by changing CO2 into another form (Freund, 2001), does not generally provide

14 This is an indicative value calculated by averaging the figures across the six SRES marker scenarios; this value varies considerably depending on the scenario and the parameter values used in the climate model.

similar capacity for the abatement of emissions at low cost (Audus and Oonk, 1997); Chapter 7 looks at some aspects of this.

The extent to which these reservoirs are within reasonable, cost-competitive distances from the sources of CO2 will determine the potential for using this mitigation option.

1.6.3 How long will the CO2 remain in storage?

This seemingly simple question is, in fact, a surprisingly complicated one to answer since the mechanisms and rates of release are quite different for different options. In this report, we use the term 'fraction retained' to indicate how much CO2 remains in store for how long. The term is defined as follows:

• 'Fraction retained'' is the fraction of the cumulative amount of injected CO2 that is retained in the storage reservoir over a specified period of time, for example a hundred or a million years.

Chapters 5, 6 and 7 provide more information about particular types of storage. Table AI.6 in Annex I provides the relation between leakage of CO2 and the fraction retained. The above definition makes no judgement about how the amount of CO2 retained in storage will evolve over time - if there were to be an escape of CO2, the rate may not be uniform.

The CO2 storage process and its relationship to concentrations in the atmosphere can be understood by considering the stocks of stored CO2 and the flows between reservoirs. Figure 1.6 contains a schematic diagram that shows the major stocks in natural and potential engineered storage reservoirs, and the flows to and from them. In the current pattern of fossil fuel use, CO2 is released directly to the atmosphere from human sources. The amount of CO2 released to the atmosphere by combustion and industrial processes can be reduced by a combination of the various mitigation measures described above. These flows are shown as alternative pathways in Figure 1.6.

The flows marked CCS with a subscript are the net tons of carbon dioxide per year that could be placed into each of the three types of storage reservoir considered in this report. Additional emissions associated with the capture and storage process are not explicitly indicated but may be considered as additional sources of CO2 emission to the atmosphere. The potential release flows from the reservoirs to the atmosphere are indicated by R, with a subscript indicating the appropriate reservoir. In some storage options, the release flows can be very

Figure 1.6 Schematic diagram of stocks and flows of CO2 with net flows of captured CO2 to each reservoir indicated by the label CCS (these flows exclude residual emissions associated with the process of capture and storage). The release flows from each of the storage reservoirs are indicated by the labels R. The stock in the atmosphere depends upon the difference between the rates at which CO2 reaches the atmosphere and at which it is removed. Flows to the atmosphere may be slowed by a combination of mitigation options, such as improving energy efficiency or the use of alternatives to fossil fuels, by enhancing biological storage or by storing CCS in geological formations, in the oceans or in chemicals or minerals.

small compared to the flows into those storage reservoirs.

The amount in storage at a particular time is determined by the capacity of the reservoir and the past history of additions to, and releases from, the reservoir. The change in stocks of CO2 in a particular storage reservoir over a specified time is determined by the current stock and the relative rates at which the gas is added and released; in the case of ocean storage, the level of CO2 in the atmosphere will also influence the net rate of release15. As long as the input storage rate exceeds the release rate, CO2 will accumulate in the reservoir, and a certain amount will be stored away from the atmosphere. Analyses presented in this report conclude that the time frames for different storage options cover a wide range:

• The terrestrial biosphere stores and releases both natural and fossil fuel CO2 through the global carbon cycle. It is difficult to provide a simple picture of the fraction retained because of the dynamic nature of this process. Typically, however, 99% is stored for decades to centuries, although the average lifetime will be towards the lower end of that range. The terrestrial biosphere at present is a net sink for carbon dioxide but some current biological sinks are becoming net sources as temperatures rise. The annual storage flows and total carbon storage capacity can be enhanced by forestry and soil management practices. Terrestrial sequestration is not explicitly considered in this report but it is covered in IPCC, 2000b.

• Oceans hold the largest amount of mobile CO2. They absorb and release natural and fossil fuel CO2 according to the dynamics of the global carbon cycle, and this process results in changes in ocean chemistry. The fraction retained by ocean storage at 3,000 m depth could be around 85% after 500 years. However, this process has not yet been demonstrated at a significant scale for long periods. Injection at shallower depths would result in shorter retention times. Chapter 6 discusses the storage capacity and fractions retained for ocean storage.

• In geological storage, a picture of the likely fraction retained may be gained from the observation of natural systems where CO2 has been in natural geological reservoirs for millions of years. It may be possible to engineer storage reservoirs that have comparable performance. The fraction retained in appropriately selected and managed geological reservoirs is likely to exceed 99% over 1000 years. However, sudden gas releases from geological reservoirs could be triggered by failure of the storage seal or the injection well, earthquakes or volcanic eruptions, or if the reservoir were accidentally punctured by subsequent drilling activity. Such releases might have significant local effects. Experience with engineered natural-gas-storage facilities and natural CO2 reservoirs may be relevant to understanding whether such releases might occur. The storage capacity and fraction retained for the various geological storage options are discussed in Chapter 5.

• Mineral carbonation through chemical reactions would provide a fraction retained of nearly 100% for exceptionally long times in carbonate rock. However, this process has not yet been demonstrated on a significant scale for long periods and the energy balance may not be favourable. This is discussed in Chapter 7. • Converting carbon dioxide into other, possibly useful, chemicals may be limited by the energetics of such reactions, the quantities of chemicals produced and their effective lifetimes. In most cases this would result in very small net storage of CO2. Ninety-nine per cent of the carbon will be retained in the product for periods in the order of weeks to months, depending on the product. This is discussed in Chapter 7.

1.6.4 How long does the CO2 need to remain in storage?

In deciding whether a particular storage option meets mitigation goals, it will be important to know both the net storage capacity and the fraction retained over time. Alternative ways to frame the question are to ask 'How long is enough to achieve a stated policy goal?' or 'What is the benefit of isolating a specific amount of CO2 away from the atmosphere for a hundred or a million years?' Understanding the effectiveness of storage involves the consideration of factors such as the maximum atmospheric concentration of CO2 that is set as a policy goal, the timing of that maximum, the anticipated duration of the fossil fuel era, and available means of controlling the CO2 concentration in the event of significant future releases.

The issue for policy is whether CO2 will be held in a particular class of reservoirs long enough so that it will not increase the difficulty of meeting future targets for CO2 concentration in the atmosphere. For example, if 99% of the CO2 is stored for periods that exceed the projected time span for the use of fossil fuels, this should not to lead to concentrations higher than those specified by the policy goal.

One may assess the implications of possible future releases of CO2 from storage using simulations similar to those developed for generating greenhouse gas stabilization trajectories16. A framework of this kind can treat releases from storage as delayed emissions. Some authors examined various ways of assessing unintended releases from storage and found that a delay in emissions in the order of a thousand years may be almost as effective as perfect storage (IPCC, 2001b; Herzog et al, 2003; Ha-Duong and Keith, 2003)17. This is true if marginal carbon prices remain constant or if there is a backstop technology that can cap abatement costs in the not too distant

For further discussion of this point, see Chapter 6.

16 Such a framework attempts to account for the intergenerational tradeoffs between climate impact and the cost of mitigation and aims to select an emissions trajectory (modified by mitigation measures) that maximizes overall welfare (Wigley et al, 1996; IPCC, 2001a).

17 For example, Herzog et al. (2003) calculated the effectiveness of an ocean storage project relative to permanent storage using economic arguments; given a constant carbon price, the project would be 97% effective at a 3% discount rate; if the price of carbon were to increase at the same rate as the discount rate for 100 years and remain constant thereafter, the project would be 80% effective; for a similar rate of increase but over a 500 year period, effectiveness would be 45%.

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