Interreg Project, WP3: Pathways for CCS in the Skagerak regionenergy-pathways.org/pdf/CCS 29...

Chalmers University of Technology

Interreg Project, WP3:

Pathways for CCS in the Skagerak region

Pathway workshop, September 29, 2009, Chalmers


Outline of presentation• Background – CCS

– The Emission Trading Scheme– Current status of CCS

• Previous and ongoing work of relevance for Interreg at Chalmers– Capture– Modelling– CO2 transport and storage

• Interreg – some first thoughts and discussion on focus and method to be applied in the project


The Emission Trading Scheme • Covers 40% of EU’s GHG emissions and close to 50% of CO2 emissions.• EU-wide target capping emissions from relevant installations at 21% below

2005 levels by 2020.– Will reduce number of allowances by 1.74% p.a.

• Power sector: 100% auctioning of emission allowances from 2013.• Industry: 20% auctioning of emission allowances in 2013 increasing to 70%

in 2020 (“with a view to reach 100% in 2027”).– Distribution method for free allowances will be developed by the end of 2010

determined by benchmarks based on most efficient techniques and processes • Industries subject to carbon leakage: Global climate deal, sector-wise

agreements or free allowances under the ETS? Up to 2020? – Commission Draft Decision September 18, 2009: 164 industrial sectors and

sub-sectors exposed to carbon leakage. Final decision should be adopted by the Commission by end 2009 pending on the outcome of the Copenhagen meeting


Current status of CCS• European Parliament adopted the CCS directive in December 2008• EU targets 12 large-scale CCS demo plants up and running in 2015

• Financing through ETS and EERP (European Economic Recovery Plan)• CO2PIPETRANS completed: Industry Guidelines for pipeline transport of CO2• CO2QUALSTORE underway: Guidelines for site selection to be released Sept 2009• Storage capacity further down, GeoCapacity Final Reports summer 2009:

• ”The conservative and probably most realistic approach”:• 113 Gt* of which 92 Gt in aquifers, 20 Gt in hydrocarbon fields, 1 Gt in coal fields

• Total Potential: • 360 Gt of which 116 Gt onshore and 244 Gt offshore and including 178 Gt in aquifers offshore

Norway.

• Main remaining obstacles• Cost of Capture• Liability issues, Property rights• Onshore storage: Public acceptance

• Facing local opposition in Denmark (Vattenfall, Vedsted), France (Total, Lacq), Germany (RWE, Schleswig-Holstein) and the Netherlands (Shell, Barendrecht)

* Refers to EU-20 + Norway and relative to Gestco and excluding Austria, Cyprus, Finland, Ireland, Malta, Portugal, Sweden


Geographical distribution of European CO2 sources (Legend: red operating fossil plants, brown refineries, black iron & steel, yellow cement, green coke ovens, blue others)

• All fossil plants ≥ 10 MWe– Combined capacity 426 GW

Emissions 2006: 1,380 Mt (Public Power & heat)

• 161 Refineries– Verified 2007 emissions:

309 Mt• 250 Steel mills

– Verified 2007 emissions: 138 Mt

• 20 Coke oven facilities– Verified 2007 emissions:

22 Mt• 571 Cement plants

– Verified 2007 emissions: 195 Mt

Source: Chalmers Power Plant Database, Chalmers Industry Database


Geographical distribution of European storage sites (Legend: red gas fields, blue oil fields, green aquifers, coal fields not shown)

• 1,200 Storage sites• Storage potential

ranging from ~117 to ~360 Gt

• Of which 80 to > 90% in aquifers

• The bulk located in the North Sea

• Rough reservoir specific storage capacity, OBSERVE: Under revision based on GeoCapacity 2009

Source: Chalmers CO2 Storage Database, GeoCapacity 2009


Ongoing study on Industry CCS: Capture• Emphasis placed on four industry sectors with promising prospects for CCS:

Refineries, Iron and steel, Cement, Pulp and Paper • Post-combustion capture:

– Low level of technical uncertainty– Associated with high costs

• The potential for more process specific capture technologies, with lower costs, can be explored further.– Cement industry: Oxy-combustion in pre-calciner with CO2 capture

• Cost per tonne of CO2 captured: ~35 €/tCO2 (~40 €/tCO2 avoided)• CO2 Capture rate: 50%• Status: Development still in an early stage. No pilots planned.

– Steel industry (not relevant for Interreg): Top Gas Recycling Blast Furnaces with CO2 capture integrated steel plants.

• Capture cost: ~20 €/tCO2• CO2 Capture rate: 70%• Status: Pilots planned in Eisenhüttenstadt (2010-2014) and Florange (2011-2015)

Johan Rootzén, PhD-candidate, Dept of Energy and Environment, Chalmers


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Modelling Europe’s power sector provides cost of CO2 emissions

Modelling tools for the EU power sector investigating stringent CO2 caps (here 85% reduction by 2050 rel. 1990) provides marginal prices on electricity and CO2 abatement 0

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Mikael Odenberger, PhD, Dept of Energy and Environment, Chalmers


Modelling CCS Infrastructure – Example Germany (black: coal plants, brown: lignite plants, red: large gas fields, green: aquifers, purple: boosters)

• Annually captured CO2 provided by the electricity model

• Power plants phased out based on age

• Standard new coal plants taken from ENCAP

• Pipelines designed from the start to accommodate peak flow from the system.

• Bulk pipelines divided into 10 Mtpa Reservoir Pipelines (RPL) 30 km from the reservoir.

• RPL divided into 0.5 or 1.0 Mtpa injection pipelines 2 km from the reservoir (depending on injectivity). Offshore limitation: Max 20 wells/platform.


Cost of CCS Infrastructure – German example• Pipelines:

– Assumed onshore pipelines 20% longer than a straight line in GIS (10% offshore in UK example).

– Applied a terrain factor of 1.2 for all onshore pipelines.– Sizing and cost taken from IEA (2005) but cost scaled up by a factor 2.

• Compression, booster stations:– CO2 received at 110 bars, re-pressurised each 200 km.– Energy consumption re-pressurization 1.9 kWh/ton CO2 (IEA 2005).– Cost for booster stations taken from IEA (2005).

• Storage:– Site development cost, cost for onshore surface facilities and monitoring taken

from IEA (2005).– Cost for offshore platforms in UK example taken from Pöyry et al (2007).

Maximum 20 injection wells/platform


Main conclusions CCS infrastructure modelling and analysis

• 5.2 Gt captured and stored in Germany 2020-2050– Total system costs ranged between € 18 and 23 billions– Specific costs ranged between € 3.4 and € 4.4 per ton CO2

• Optimized system may require public-private partnerships• Ownership concentration of CO2 sources likely to facilitate

development of a centralised system• The main obstacle to a centralised system appears to be the

phasing in of capture plants over time• The transportation system is likely to follow existing pipeline

trajectories• Low-cost systems characterised by large volumes of CO2 transported

over relatively short distances.


Main conclusions• Post-combustion capture may not be the best capture solution for the

cement industry.• Modelling the European electricity sector provides a good estimate for

future CO2 price.• Good prospects for large-scale demo plants up and running in 2015.• The ramp-up may experience problems with regard to phasing in of

capture plants and optimisation of infrastructure • Commercial deployment will require a functioning carbon market.• Liability and ownership issues not resolved• Public acceptance may become a serious barrier with regard to

onshore storage – could be wise to go for offshore storage, at least initially to build up confidence


Interreg Project

• Project leader: Tel-Tek Porsgrunn• Project participants: Industries, authorities, institutions in

Denmark, Norway and Sweden• Total Budget (Chalmers): SEK 1.8 million. • Project time: 2009-2010• Project Outline: 4 Work packages • Chalmers leading WP 3: System analysis (political, judicial,

economical perspectives)


Project Outline• Sources:

– 3 power plants, 3 refineries, 2 cement plants, 1 of each petrochemical, paper & pulp, ammonia and ethylene.

• Current capture potential ~ 10 Mtpa

– Skagerak Energi CCGT’s will require a gas pipeline but Skanled shelved?

• Potential sinks:– Aquifers onshore and offshore Denmark– Oil and gas fields in the North Sea?– Aquifers southwest Skåne?– Suitable reservoirs in the Skagerak region?


CO2 EOR/EGR (squares CO2 storage sites, circles CO2 sources, same colour distribution as previous slides)

• Most Danish HC fields are chalk reservoirs – c.f. GeoCapacity WP2, section 5.6.2

• Southern Norwegian fields are either chalk or very smallSource: Chalmers CO2 Storage Database


Storage onshore or offshore? (Gestco storage capacity (Mt) shown, GeoCapacity total potential marginally lower)

• Shown storage capacity (Gestco) assumes ”open aquifers”, i.e. marginal pressure build-up during injection. GeoCapacity’s ”conservative” estimate is 85% lower assuming closed structures.

• Onshore storage is facing local opposition also in Denmark (Vattenfall, Vedsted)

Offshore

Source: Chalmers CO2 Storage Database, Gestco 2004


Conclusion: Storage in Danish offshore aquifers makes sense!

• Unless suitable reservoirs are identified in the Skagerak region

Source: Chalmers CO2 Storage Database, Gestco 2004


First ideas on methodology• Assessment of capture technologies for the industries of

relevance in the region– The aspect of timing: Phasing in capture plants?

• Develop and refine method on CCS infrastructure analysis.– Centralised structure (should be linked to the phasing in of capture

plants)?

• Definition of CCS scenarios for the Skagerrak region– Could be wise to go for offshore storage?– Unless suitable reservoirs are located in the Skagerak region it seems as

if offshore Danish aquifers provide the best solution?

• Refining the storage definition in the analysis – with input and cooperation with WP1 and WP2


SoS


SOS Europe• Dwindling indigenous resources and rising global demand

• Scramble for resources• Oil shale• Underground Coal Gasification• Unconventional gas

• Where will demand go?• Climate change: ”A Game Changer”• Raising the contribution from renewables and raising

energy efficiency (reducing demand) will do both:• Enhance SOS• Mitigate Climate Change


The effects of Climate Change Mitigation


Fossil Fuel’s CO2 emission potential and global carbon budgets

Sources: BGR (2009), IEA WEO 2008, IPCC (2007), Meinshausen (2009)


Long-term oil demand projections

Sources: BP 2008, IEA WEO 2007 & 2008, IEA ETP 2008


Long-term gas demand projections

Sources: IEA WEO 2007 & 2008, IEA ETP 2008


Long-term coal demand projections

Source: IEA ETP 2008


Europé Gas


Future gas supply Gap EU

Sources: IEA WEO 2007/2008, European Energy and Transport Trends to 2030, 2007 Update, Chalmers Fuel db

Supplies 2008 and national projections:Russia: 155 bcm rising to 180-200 bcm?Norway: 96 bcm rising to 115-140 bcm? Algeria: 50 bcm rising to 85 bcm?5 other countries: 42 bcm in 2007 and rising


Russia: Depletion, Timing, Financing?

• Gazprom’s super-giants in Nadym Pur Taz decline at ~ 20 bcmpy; maintaining and raising production implies opening up Yamal fields and Shtokman.

• Yamal holds > 10 Tcm proven gas reserves, Gazprom’s fields on Yamal may have a plateau production of ~180 bcmpy.

• Development Yamal & Shtokman require huge investments (~US $ 80-90 billions*) while Gazprom’s revenues are declining!

Source: IEA Natural gas market review 2008, Chalmers Fuel database, * Jonathan Stern, OIES 2008

ShtokmanYamal


Norway’s supply ability-depletion of Norwegian gas resources

Source: Norwegian Petroleum Directorate


US reference gas production, import capacity and demand forecast(commissioning approved terminals arbitrarily set to 2015)

US projected gas production up by 30 bcm in 2010 and by 120 bcm in 2030 relative to AEO 2008 edition.

CAGR 2007-2030 demand: 0.2%?

Source: EIA Annual Energy Outlook (AEO) 2009, Chalmers Fuel database


Global LNG demand and capacity 2000-07 plus projection 2009-13, bcm (LNG plants added 2009-2013 include plants under construction only)

Source: Chalmers Fuel database

CAGR: 6.4%

Significant LNG surplus capacity driving spot prices down


Europe Coal


Modeling EU’s power generation minimizing total system costs

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Baseline scenario EU+Norway:30% CO2 reduction 2020 and 85% by 2050

Market dynamics?Fuel supply chains?

Baseline scenario + 20% RES2020 and 60% by 2050 + 13%lower demand relative baselinein 2020 and 23% lower in 2050

RES forced into the system; no considerations on market dynamics/fuel chains

Source: Mikael Odenberger et al, 2008, 2009


Europe’s coal reserves and resources• Hard coal, end 2007:

– ”Proven” reserves: 18 Gt– Resources (ex reserves): 474 Gt– Consumption (2006): 375 Mt (steam coal 280 Mt)

• Lignite (Brown Coal), end 2007:– ”Proven ”reserves”: 53 Gt– Resources (ex reserves): 278 Gt– Consumption (2007): 575 Mt

• Replacing coal based power with lignite would raise annual consumption to 1,275 Mt*.

* Assuming 25 and 10 MJ/kg for coal and lignite respectively


SoS Indicators• Supply ability vs peak consumption

– Production capacity– Storage withdrawal capacity– Import capacity

• Share of total supply• No of suppliers• No of entry points

– Flexibility in the system • Surplus capacity, e.g. in the power sector• Fuel switch • Interruptible supply• Cross-border assistance

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