Challenges for Early MoversChallenges for Early ... - IEAGHG
Transcript of Challenges for Early MoversChallenges for Early ... - IEAGHG
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Challenges for Early MoversChallenges for Early Movers The ZeroGen Experience
Presentation to the
Expert Meeting on Financing Carbon Capture and Storageby Dr Anthony Tarr, Chief Executive Officer, ZeroGen Pty Ltd
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Challenges for Early Movers
• Global and national setting
• Project overview
• Project deployment challenges
• Some important `open` issues
HB# 96042422
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ZeroGen - global and national setting
• Ratified Kyoto Protocol – 2010 emission trading scheme
• Climate change - public policy and business decision makers
• State energy policies – new coal-fired power stations w/oState energy policies new coal fired power stations w/o CCS
• F di F d l St t d i d t f di it t• Funding – Federal, State and industry funding commitments
• Australian coal industryy
• Integrated Gasification Combined Cycle (IGCC) + Carbon Capture and Storage (CCS) in the future energy mix
HB# 96042433
Capture and Storage (CCS), in the future energy mix
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Project Overview
• Location: Queensland, Australia
• Current structure: owned by Queensland Government
• Technology approach: IGCC + CCS
• Timeline: Stage I - 2012, Stage II -2017Timeline: Stage I 2012, Stage II 2017
• Substantial industry support: ACALET, ACA, Shell
HB# 96042444
y pp
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Project Overview – Project Participants
HB# 96042455
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Project Overview
2012 – Stage I• 6FA 82MWh• Construction
competed 2017 – Stage II
2008• Initial feasibility 6FA
• Financial planning
Initial funding from ACALET & competed
• Operation for 5 years
• Location already determined
2017 Stage II• 9F 279MWh
• 90% CO2 capture
• Location TBD
• Initial funding from ACALET & ACA
• Approval for 9FA
• Conceptual JV term sheet• Partial funding in
place
• 75% CO2 capture
• Funding structure TBD• Agreement with Shell
• Discussions with GE, Honeywell and others
GASCOAL6FA -82MWh
2008 2012 2017 20202008 2012 2017 2020
2009• Stage I feasibility study
• Composition of investors mix
2020 – Stage IIIFuture competitive landscape• Fuel costs
HB# 96042466
• Funding programme initiation
• Stage II feasibility study (2012)• CO2 costs
• Technology costs
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Project deployment challenges
• ZeroGen IGCC + CCS identified by Australian coal industry as priority technologies for development
• Challenges for deployment exist in relation to:
Political legal and regulatory Technologyg y
Community and Stakeholders
Financial, Commercial &
E i
HB# 96042477
Stakeholders Economic
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Project deployment challenges
Political, Legal and Regulatory
P it d l t f k• Permits and regulatory framework
• Consensus and joint undertakings
• Approvals issued for IGCC / CCS
• Fragmented global CO policy• Fragmented global CO2 policy
• Globally relevant regulations
Technology
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Financial, Commercial & Economic
Community
&
Stakeholder
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Project deployment challenges
Technology• IGCC technology• CCS• CCS• Geosequestration
- Exploration- Injection- Well design
Location and technology integrationLocation and technology integration- Site selection- Construction
Political, Legal &
Regulatory
Community
- O&M
HB# 96042499
Financial, Commercial & Economic
Community
&
Stakeholder
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Project deployment challenges
Political, Legal &
RegulatoryTechnology
Financial, Commercial & EconomicCommunity & Stakeholders
• Investment and public community confidence in CCSInvestment and public community confidence in CCS
• Over 200 interest and stakeholder groups
• Current support frompp
- Government
- Public
- Industry
- Commercial
HB# 9604241010
- Union
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Project deployment challengesPoliticalPolitical, Legal &
RegulatoryTechnology
Community
&
StakeholderFinancial, Commercial & Economic
Financial: Revenue and profitability dependent on:Financial: Revenue and profitability dependent on:• carbon pricing• government subsidies• technology efficiency improvements gy y p
(CapEx, OpEx)
Financial risk: Technical, Financial (loan & interest, bankability)bankability)
Commercial: Identifying L-T investor
Economic: Input optimisation of Australian economy
HB# 9604241111
and coal industry
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Project deployment challengesIGCC with CCS cost breakdownIGCC with CCS cost breakdown
ZeroGen focus
HB# 9604241212
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Some important `open` issues
G h d ETS di
Investment structuring - funding options and schemes
• Grants enhanced ETS credits
• Industry participants
• Funding options will be discussed with Government
• Loan guarantees
with Government funds, and commercial banks
• Private parties
• ETS for direct investment • Need for innovative
ideas to address b k bilit f
• Clean Development Mechanism (CDM) credits
bankability of demonstration projects
HB# 9604241313
( )
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Thank youy
HB# 96042414