Key Challenges, Opportunities andStrategies for Carbon Capture and

Storage Deployment

Presentation to MIT Club of Washington DCMarch 22, 2016Victor Der, Executive Advisor - AmericasGlobal CCS Institute

What is Carbon Capture and Sequestration?

Ocean

Capture and storage of CO2 and other greenhouse gases thatwould otherwise be emitted to the atmosphere

Terrestrial CaptureCO2 absorbed from air

Point Source Capture

• Power Plants

• Ethanol Plants

• Cement

• Steel

• Refineries

• Natural GasProcessing

Terrestrial StorageTrees, grasses, soils

Geologic Storage

• Saline formations

• Depleted oil/gas

• Unmineable coal

•Other: basalts,shalesSandstone

CCS is a vital element of a low-carbon energy future

Source: IEA Energy TechnologyPerspectives (2015)

A transformation in how we generate and use energy is needed

GtC

O2

emis

sion

s

6DS

2DS

Mitigation costs more than double in scenarios with limitedavailability of CCS

*Percentage increase in total discounted mitigation costs (2015-2100) relative to default technology assumptions – median estimate

+ 7% + 6%

+ 64%

+ 138%

Baseline costwith all mitigationoptions utilized

Source: IPCC Fifth Assessment Synthesis Report, Summary for Policymakers, November 2014.

Cost increase underlimited technologyavailability scenarios

50

100

150

Perc

enta

ge*

Nuclear phase out Limited solar/wind

Limited bioenergy

No CCS

Technology – Market – Policy DynamicsMARKET

Pull and SkewedBy Policy

TECHNOLOGY

Pushes Marketsand GuidesPolicy

POLICY/REGS

“Pubic Good” byShaping Market &Enabled by availableTechnology

• Federal Government– Support R&D

New TechnologyOptions

– Remove barriers& Lower hurdlesfor the publicgood.

– ProvideIncentives &Framework

BUSINESS CASEFOR CCS

FINANCEABILITYACCEPTANCE

Challenges to CCS Deployment

7

Key Challenges to Carbon Capture and Storage

• Capture Technology– Existing Plants– New Plants (PC)– IGCC

• Cost of CCS

• Sufficient Storage Capacity

• Permanence

• Best Practices– Storage Site

Characterization– Monitoring/Verification– Site Closure

• Regulatory Framework– Permitting– Treatment of CO2

• Policy incentives

• Infrastructure

• Human Capital

• Legal Framework– Liability– Ownership

• pore space• CO2

• Public Acceptance(NIMBYà NUMBY)

Technical Issues Legal/Social Issues

DOE projects helping to address bothcategories of issuesSource: US DOE

8

COMMERCIAL GAPS HAVE TO BE ADDRESSED

Illustrative Coal Fired Power Plant + CCS

NPV

inU

S$Bi

llion

s

4

2

0

-2ForecastedElectricityRevenues

OPEXBasePlant

CAPEXBasePlant

CommercialGap

CAPEXCCS

OPEXCCS

Bridge?

9

CCS competitiveness against other low carbonalternatives in Europe in 2012-17

CoE Low Carbon technologies – New PP over next 5 years

7986

0

50

100

150

200

250

300

Hardcoal wCCS Post

2017

Gas CCPPw CCS2017

Nuclear Hydro Geo-thermal

WindOnshore

WindOffshore

SolarThermal

Solar PV0

50

100

150

200

250

300

€ / MWh Reference case

Up to 45€cents/kWh

Low caseCSP Tower with

storage(82 for Ref CCS Oxy)

Source : Alstom analysis 2012. CCS w Post amine 2017 costs, including on shore T&S & CO2 price (Flue GasRecirculation for CCS Gas CC) CoE do not include “externalities” of Intermittent power (Back-up cost, balancingcost, grid enhancement if required)

Under realistic assumptions and with a conservative variation range, CCS is already inthe “mix” of low carbon alternatives

EUROPE

Investments in Clean EnergyDriven by Policy Incentives

Clean energy investment* between 2004-2013 ($USD):

CCS Investment: $20 B

All Clean EnergyInvestment:$ 1929 B

0

100

200

300

400

500

600

700

800

900

1000

1100

1200

1300

1400

1500

1600

1700

1800

1900

2000

CCS All clean energy

USDbillion

20

1929

* Includes technology development, projects, M&A. Source: BNEF.

Data source: Bloomberg New Energy Finance as shown in IEA presentation “Carbon Captureand Storage: Perspectives from the International Energy Agency”, presented at National CCSweek in Australia, September 2014.

A significant task within one generation

44 large-scale CCS projects -combined capture capacity of80 Mtpa*:

• 22 projects in operation orconstruction (40 Mtpa)

• 10 projects in advancedplanning, five nearing FID(15 Mtpa)

• 12 projects in earlier stagesof planning (25 Mtpa)

OECDNon-OECD

4,000 Mtpa of CO2captured by CCS by 2040

(IEA 450 Scenario)**

40 Mtpa

Global Statusof CCS: 2015

*Mtpa = million tonnes per annum **Source: IEA, Energy Technology Perspectives (2015).

Pathway for Technology CommercializationTRL 2 Successes

from FWP,SBIR/STTR, ARPA-E

Transfer to Office ofMajor Demonstrations

Scope ofCapture Program

“Valley of Death” for Technologies

Source: US DOE

Carbon Capture

CO2 Capture Optionsfor Fossil Energy Generators

Source: Cost and Performance Baseline for Fossil Energy Power Plants study,Volume 1: Bituminous Coal and Natural Gas to Electricity; NETL, May 2007.

Pulverized Coal (PC)Post-combustion

PC Oxy-combustion

Gasification (IGCC)Pre-combustion

Technologies alsoapplicable to:

• Industrial sources(cement, refinery,chemical…)

• NGCC power plants

1st Generation CO2 Capture –Impact on Plant Cost

Source:Cost and Performance Baseline for Fossil Energy Power Plants study, Volume 1: BituminousCoal and Natural Gas to Electricity; NETL, Nov. 2010 revision.Unpublished 2011 update to Pulverized Coal Oxycombustion Power Plants, Volume 1:Bituminous Coal to Electricity; NETL, Aug. 2008 revision.

No

Cap

ture

With

Cap

ture

0

20

40

60

80

100

120

140

IGCC Post-Combustion Oxy-combustion NGCC

77

59 59 59

112107

9686

Cost

ofEl

ectr

icity

,$/

MW

h

Base Plant

With CO2 Capture

IGCC Post-Combustion

Oxy-Combustion

NGCC

1st Generation CO2 Capture –Impact on Plant Efficiency

0

10

20

30

40

50

60

Avg IGCC Avg IGCCw/CO2Capture

PC-Sub PC-Subw/CO2Capture

PC-Super PC-Superw/CO2Capture

PC-Super PC-Superw/ Oxy-Comb.

NGCC NGCCw/CO2Capture

40

3237

26

39

28

39

29

50

43

Net

Effic

ienc

y(H

HV)

Gasification Pulverized Coal Combustion Natural GasCombined Cycle

Source:Cost and Performance Baseline for Fossil Energy Power Plants study, Volume 1: BituminousCoal and Natural Gas to Electricity; NETL, Nov. 2010 revision.Unpublished 2011 update to Pulverized Coal Oxycombustion Power Plants, Volume 1:Bituminous Coal to Electricity; NETL, Aug. 2008 revision.

Post-combustion CO2 CaptureAmine-based scrubbing

Reference: Pulverized Coal Oxycombustion Power Plants—Volume 1 Bituminous Coal to Electricity, U.S.Department of Energy/National Energy Technology Laboratory, Revision 2 Final Report, August 2008

Two-step separation process requiring 5 energy inputs:

Energy = Q (sensible) + Q (reaction) + Q (stripping) + W (Process) + W (Compression)

ALL must be reduced in order to significantly reduce Capture COE impact!

0

10

20

30

40

50

60

70

80

90

Perc

entI

ncre

ase

inC

OE

Trans., Stor., & Monit.Compression CapitalCapture CapitalCapture OperatingCapture SteamCapture Aux. PowerCompression power

13%

11%

28%

7%

20%

5%2%

Parasitic Powerh COE by 52%

Operating Costh COE by 7%

Capital Costh COE by 27%

Pressurized Oxy-CombustionAllam Cycle – sCO2 Working Fluid

Carbon StorageAnswering Key Questions:

Safe & Stable and SufficientStorage Capacity

Lines of Evidence Suggesting GeologicalStorage Will Be Secure

• Natural CO2 reservoirs• Oil and gas reservoirs• 70 CO2 EOR projects in U.S.• 50 acid gas injection sites in North America• Numerical simulation of geological systems• Current Large-Scale CO2 storage projects

“At least 99%+ retention is likely for wellselected and managed storage sites”

Bullets Based on Rubin, CMU; Quote from IPCC Special Report on Carbon Capture & Storage

DRAFT DELIBERATIVE – DO NOT CITE, QUOTE OR DISTRIBUTE

CO2 Geologic Storage – Risk Profile• CO2 may be permanently trapped in subsurface over time

– Trapping mechanisms reduce CO2 mobility

– Reduces potential to impact USDWs or to return to atmosphere

• Relative project risks at zero before injection

• Increasing during injection and subsiding over time followingcessation of injection

From Benson (2007)

21

CO2 as a supercritical fluid• CO2 increases in density with depth, becomes a supercritical fluid

and takes up much less space in the tiny pore spaces in storagerocks. The blue numbers show the volume of CO2 at each depthcompared to a volume of 100 units at the surface.(Image source CO2CRC (http://www.co2crc.com.au/imagelibrary/); CO2 phase diagram (Bielinski2006)

Carbon Storage – How does it work?Storage mechanisms vary by target class; generally multiple

processes which improve over time•Physical trapping

•Residual phase trapping

•Solution/MineralTrapping

•Gas adsorption•For organic minerals only (coals,oil shales)

1.0MgCO30.2NaAlCO3(OH)2

Source: S Benson, LBNL

1. Solubility TrappingCO2(g) CO2(aq)

CO2(aq) + H2O H2CO3(aq)

2. Ionic TrappingH2CO3(aq) HCO3

-(aq) + H+

HCO3-(aq) CO3

2-(aq) + H+

3. Mineral TrappingCO3

2-(aq) + Ca2+ CaCO3(s)

HCO3-(aq) + Ca2+ CaCO3(s) + H+

Sequence of Geochemical Reactions betweenCO2 and Formation Water and Rocks

Sequence of Geochemical Reactions betweenCO2 and Formation Water and Rocks

Height of Willis Tower(Sears Tower)

Roof is 1,451 feet

Antenna is 1,730 feet

Porous injection Zone is400 feet thick)

Geologic Storage – How Deep?Example Formation: Mount Simon – Thickness 1,506 feet

WashingtonMonument is 555

feet tall

Depth of Mt. Simon

This example startsat 5,550 feet

(over a mile deep)

Slide adapted from slide courtesy of: William R. RoyUniversity of Illinois

26

North American CO2 Storage Potential(Billion Metric Tons)

Sink Type Low High

Saline Formations 1,653 20,213

Unmineable Coal Seams 60 117Oil and Gas Fields 143 143

U.S. Emissions ~ 6 Billion Tons CO2/yr (all sources)

Hundreds toThousands ofYears Storage

Potential

Sufficient Capacity for Secure Storage Emerging

Saline Formations

Oil and Gas Fields Unmineable Coal Seams

ConservativeResource

Assessment

OpportunitiesCarbon Utilization andStorage/Sequestration

Longer than expected:EOR volumes estimates have grown

• Many 10’s of billions producible (justUS)

• 100’s of billions worldwide• Provide revenues: break even for

capital retrofit costs in 7-8 years!• Conventional EOR uses 2-3 tons CO2

/bbl

Billio

nBa

rrels

88.1

47.4

2.30

20

40

60

80

100

TechnicallyRecoverable

EconomicallyRecoverable*

AlreadyProduced/

Proven

Domestic Oil Resources

ARI, 2008

Millio

nMe

tricT

ons

Total U.S.CO2 Demand

NewLower-48

CO2 Demand

Net Lower-48From CapturedCO2 Emissions

02,0004,0006,0008,000

10,00012,00014,000 12,500

9,700

7,500

2,800* 2,200**

Market CO2 demand

>25B tons storage potential from conventional EORThat’s ½ the US coal fleet for ~20 yearsSource: US DOE

Non-EOR CCUS (Utilization)CO2 Conversion to Products

CO2 as Feedstock – depends on market size,competing feedstock costs, and process cost

Plastics, Chemicals, and other products

Mineralization Processes with slate of chemicals

Bio-based Fuels and Additives: ethanol, butanols,bio-diesel

Bio-Energy with CCS

Co-production of desalinated water extraction

Skyonic “Skymine” Project, San Antonio, TXOperational !!

75,000 tons/y CO2 captured - >200,000 tons avoidedSource: US DOE

Co-produced freshwater as utilization

31

Bourcier et al., 2011

While Reducing Risks of CO2 Geologic Injection andStorage via Pressure Reduction in saline formations

CCS Statusand RDD&D Strategy

Large Geological Storage Projects UnderwayEach Stores > 1 Million Tonnes CO2/yr

Photos from Staoil Website

Sleipner Project- Norway• CO2 removed from natural gas produced

on production platform in North Sea• Injection into saline reservoir under sea• Started 1996

In Salah Gas Plant - Algeria• Injection into saline formation

downdip of gas reservoir• 3 wells• Started 2004

Weyburn – Saskatchewan• EOR project with 50 wells• Uses CO2 from coal gasification plant• Started 2000

DOE R&D Goals

0% Reduction

20%Reduction

30%Reduction

40

50

60

70

80

90

100

110

IGCC orSupercritical PC

2nd-Generation Technology TransformationalTechnology

COE

Relat

iveto

Toda

y'sCo

alwi

thCa

ptur

e,%

SOTA FY20-25 Demo FY25-30 Demo

Cost of Electricity Reduction TargetsCost of Electricity Reduction Targets Carbon Capture ProgramObjectives:

• Large-scale pilot validation• 2nd generation by 2020• Transformational by 2025

• Demonstration 5 years after eachlarge pilot phase

• Meet 20% reduction by advancedsolvents and systems; membranes,and sorbents

• Meet 30% goal through disruptiveresearch in novel materials,advanced manufacturing, processintensification, electro chemical,and other advanced processes

Source: US DOE

Coal R&D: Integrated Solutions are Essential to meetObjectives

Source: US DOE

Advanced Combustion

CO2 StorageAdvanced CO 2 Captureand Compression

q Solventsq Sorbentsq Membranesq Hybridq ProcessIntensificationq CryogenicCapture

q Pressurizedq O2 membraneq Chemical

loopingq USC Materials

q Carbon Utilization(EOR)

q Infrastructure(RCSPs)

q Geological Storageq Monitoring,

Verification andAccounting

q Gasificationq Turbinesq Supercritical CO2q Direct Power Extraction

Efficiencies > 45%i Capital Cost by 50%<< $40/tonne CO2 Captured

Near-zero GHGsNear-zero criteria pollutantsNear-zero water usage

Advanced EnergySystems

5 MWE Oxycombustion Pilot Advanced Turbines

Advanced CO2 Solvents

R&D approaches• Ionic liquids• Amino Acids• Potassium carbonate/enzymes• Phase change solvents• Novel high capacity oligomers• Carbonates (AC/ABC, potassium)

R&D Focus• High CO2 working capacity, optimalDHrxn, low heat capacity, non-volatile

• Fast kinetics (enzymes)• Thermally and chemically stable• Non-corrosive, environmentally safe• Low cost solvent and process MOC*• Improved mass transfer systems• Match process to solvent

Advantages• 70+ years acid gas scrubbing experience• Allows good heat integration and

management (useful for exothermic rxns)• Selective capture from low partial

pressure CO2 streams

Challenges• Dilute chemical solutions due to

viscosity and corrosion• High regeneration energy (aqueous

phase sensible heating, stripping)• DHrxn and kinetics tradeoff

*Materials of construction

Solid CO2 Sorbents

R&D Approaches• Supported amines (silica, clay)• Metal zeolites, alumina• Carbon-based• Carbonates• Sorbent systems (CCSI4)

Advantages• Some experience with solid systems

(TSA1-dehumidification, PSA2-H2 sep.,VSA3 for oxygen separation)

• Low regeneration energy (no strippingsteam, low heat capacity substrates)

• High equilibrium capacity—high surfacearea

• Hybrid sorbents (Shift + Capture)

Challenges• Heat management• Durability (attrition, chemical stability)• Maintaining high mass transfer• System design (pressure drop & solids

transport)• Scale-up

R&D Focus• High CO2 working capacity, low heat

capacity, fast kinetics (enzymes)• Durability: thermally, chemically and

physically• Non-corrosive, environmentally safe• Low cost sorbent and process MOC1

• Match process to sorbent (system)• Hybrid (Shift + Capture) for IGCC

1Materials of Construction, 2Transport Integrated Gasification, 3Fluid Bed Catalytic Cracker, 4Carbon Capture Simulation Initiative

Gas Separation Membranes

R&D Approaches• Spiral wound• Hollow fiber• Cryogenic membrane separation• Membrane/solvent hybrid• Polymer based• Metal based

Advantages• Simple operation; no chemical reactions,

no moving parts• Tolerance to acid gases & O2

• Compact, modularà small footprint• NG purification membrane technologies

have reached similar scale to powerplant gas separation needs

• High pressure driving force in IGCC

R&D Focus• High selectivity (H2 or CO2)• High flux (permeability)• Tolerant to contaminants• Thermally stable (IGCC WGCU*)• Mechanically stable (high P ratio)• Design for high packing density• Low cost materials & manufacturing

Challenges• PC: Require feed compression or

permeate vacuum pressures• IGCC: Satisfy ‘topping’ and ‘bottoming’

cycle system requirements• PC & IGCC: Balancing flux and

selectivity

*Warm gas clean-up

Pulverized Coal Oxy-CombustionChallenges

• Cryogenic ASUs are capital andenergy intensive

• Existing boiler air infiltration• Corrosion and process control• Excess O2 and inerts (N2, Ar) h CO2

purification cost

R&D Focus• Oxygen membranes (OTM & ITM)*• Oxyfuel boilers (USC materials)• Retrofitting existing boilers (air leakage,

process control, corrosion)• CO2 Purification• System integration

*Oxygen Transport Membrane (Praxair), Ion Transport Membrane (ITM)

Advantages• Plant vs. unit operation — multiple

integration & cost reduction opportunities• 1st Generation plants with cryogenic ASU

is cost competitive with amine scrubbing• Co-sequestration options• Applicable to new and existing plants

R&D Approaches• Oxygen membranes• Oxyboiler modeling/design• Oxyburner modeling & design• Pilot-scale testing (process

control, heat transfer, …)• Corrosion testing• CO2 purification

Chemical Looping

Challenges• Solids transport

• Heat integration

• Solids attrition

• Process control

Red1700F

Ox2000F

CaS

Air

Fuel CO2 + H2O

CaSO4

MBHX N2 + O2

Steam

Advantages• Oxy-combustion and gasification without

an O2 plant• Potential lowest cost option for near-zero

emission coal power plant• Applicable to new and existing plants

R&D Approaches• Calcium and Iron-based systems• Improve oxygen carrier properties,

e.g. capacity, reactivity, and attritionresistance

• Solids handling and process design• Process heat integration• Lower capital and operating cost

Chemical looping combustion

CCSI: Accelerating Technology Development

National Labs Academia Industry

Identifypromisingconcepts

Reduce the timefor design &

troubleshooting

Quantify the technical risk,to enable reaching larger

scales, earlier

Stabilize the cost duringcommercial deployment

Source: US DOE

2nd Generation Capture Technologies

• IGCC (pre-combustion capture)– 90% capture with potential for no increase in COE– 4 to 5 percentage points higher in efficiency

than today’s plants with capture– Feedstock/product flexibility (coal, biomass, or

opportunity fuels to produce power, liquid fuels, chemicals)

• Post-Combustion Capture– COE penalty for CCS reduced from +80% (1st Generation) to +30%– 90% capture efficiency– Parasitic energy reduced (from 30% to ~15%)– Applicable to new plants, retrofits, natural gas,

& industrial power

• Oxy-Combustion– Increase in COE for CCS cut from +80% (1st Generation) to +30%– +99% capture potential– Parasitic energy reduced (from 30% to ~15%)– Applicable to new and existing power plants– Co-sequestration opportunities

ITM OxygenWarm gas cleanupHydrogen turbineSolid coal feed pumpRamgen CO2 compressor

Advanced Solvents(Ionic liquids, phase changesolvents, etc.)

CO2 membranesSolid sorbentsUSC boiler materialsRamgen CO2 compressor

Advanced Oxyfuel BoilersITM oxygenCO2 purificationUSC boiler materialsRamgen CO2 compressorChemical looping

Example Technologies

Source: US DOE

FY2015 Funding Opportunity Announcements14 Transformational Capture Technologies

Post- and Pre-Combustion Projects PerformerDevelopment of a Novel Biphasic CO2 Absorption Process with Multiple Stages of Liquid–LiquidPhase Separation for Post-Combustion Carbon Capture University of Illinois

Evaluation of Amine–Incorporated Porous Polymer Networks as Sorbents for Post-combustionCO2 Capture Texas A&M University

Hybrid Encapsulated Ionic Liquids for Post-combustion CO2 Capture University of Notre Dame

Development of a Non-aqueous Solvent CO2 Capture Process for Coal-Fired Power Plants Research Triangle Institute

Enabling 10 mol/kg Swing Capacity via Heat Integrated Sub-ambient Pressure Swing Adsorption Georgia Tech ResearchCorporation

Development of a Solid Sorbent for CO2 Capture Process for Coal-Fired Power Plants Research Triangle Institute

Electrochemically Mediated Sorbent Regeneration in CO2 Scrubbing Processes Massachusetts Institute ofTechnology

Testing of Next-Generation Hollow Fiber Membrane Modules American Air Liquide, Inc.

Energy Efficient Membrane–Based “Hybrid” Hybrid Process for Post-combustion CO2 Capture Gas Technology Institute

Development of a Hybrid Capture System with Advanced Membrane, Solvent System, andProcess Integration Liquid Ion Solutions LLC

A High-Efficiency, Ultra-compact Process for Pre-combustion CO2 Capture University of SouthernCalifornia

Sorption Enhanced Mixed Matrix Membranes for H2 Purification and CO2 Capture University of Buffalo

Combined Sorbent/Water-Gas Shift–Based CO2 Capture Process with Integrated HeatManagement Southern Research

Zeolite Membrane Reactor for Pre-combustion Carbon Dioxide Capture Arizona State University

Source: US DOE

National Carbon Capture Center

Pilot Solvent Test Unit

Post Combustion

q PC4 Facility – 4.3MWeq Real PC flue gasq Bench through pilot scaleq ~25,000 hours of testingq 15 Technologies testedq “Tech-Flexible”

Pre Combustion

q 6.3MWe Trig gasifierq Air- or O2 fired syngasq Bench through pilot scaleq ~20,000 hours of testingq 13 gasifier runsq “Tech-Flexible”

– World Class Carbon Capture Technology Test Facility –

TRIG Gasifier

§5 year $150MM§$100MM Capture Funding§Independent Test Facility§Supports Capture &

Gasification

Source: US DOE

Current DOE’s Carbon Capture Small Pilot Projects

Performer Scale Planned Construction CompletePost-combustion Solvents

Linde, LLC 1 MWe Complete

Neumann Systems Group, Inc 0.5 MWe Complete

Southern Company Services 25 MWe Complete

University of Kentucky 0.7 MWe Complete

General Electric 0.5 MWe Late 2015

ION Engineering 0.7 MWe CompletePost-combustion Sorbents

ADA-Environmental Solutions 1 MWe Complete

TDA Research, Inc. 0.5 MWe Late 2016

SRI International 1 MWe Late 2015Post-combustion Membranes

Fuel Cell Energy 1MWe 2018

Membrane Technology & Research 1 MWe Complete

Gas Technology Institute 1 MWe Early 2016Pre-combustion

SRI International 0.1 MWe Complete

TDA, Inc. 0.1 MWe Late 2015

Source : US DOE

BIG SKYBIG SKY

WESTCARBWESTCARB

SWPSWP

PCORPCOR

MGSCMGSC

SECARBSECARB

MRCSPMRCSP

Regional Carbon Sequestration PartnershipsDeveloping the Infrastructure for Wide Scale Deployment

Seven Regional Partnerships400+ distinct organizations, 43 states, 4 Canadian Provinces

• Engage regional, state, and local governments• Determine regional sequestration benefits• Baseline region for sources and sinks• Establish monitoring and verification protocols• Validate sequestration technology andinfrastructure

Development Phase (2008-2018+)

8 large scale injections (over 1million tons each)

Commercial scaleunderstanding and validation

Validation Phase (2005-2011)

20 injection tests in saline formations, depleted oil, unmineablecoal seams, and basalt

Characterization Phase (2003-2005)

Search of potential storagelocations and CO2 sources

Found potential for 100s ofyears of storage

Major CCS 1st Gen Demonstration ProjectsProject Locations & Cost Share

Clean Coal Power InitiativeICCS Area 1

Southern CompanyKemper County IGCC Project

Transport Gasifier w/ Carbon Capture~$4.12B – Total, $270M – -DOEEOR – ~3.0M MTPY 2016 start

Petra Nova (formerly NRG)W.A. Parish Generating StationPost Combustion CO2 Capture

$775 M – Total$167M – DOE

EOR – ~1.4M MTPY 2017 start

Summit TX Clean EnergyCommercial Demo of Advanced

IGCC w/ Full Carbon Capture~$1.7B – Total, $450M – DOEEOR – ~2.2M MTPY 2018 start

Air Products and Chemicals, Inc.CO2 Capture from Steam Methane Reformers

EOR in Eastern TX Oilfields$431M – Total, $284M – DOE

EOR – ~0.93M MTPY 2012 start

Archer Daniels MidlandCO2 Capture from Ethanol PlantCO2 Stored in Saline Reservoir

$208M – Total, $141M – DOESALINE – ~0.9M MTPY 2016 start

Source: US DOE

Port Arthur, TX: 1.1 M tons/y CO2 Air Products, 2013Port Arthur, TX: 1.1 M tons/y CO2 Air Products, 2013

VSA Vessels

Co-Gen Unit

Blowers

CO2Compressor &

TEG UnitCO2 Surge

Tanks

Existing SMR

Operational! 1.7M tons stored so far

Kemper County, MS: 2.7M tons/y CO2Southern Co., 2013 (Anticipated start mid-2016)

Decatur, ILADM 2013

300,000 tons/y today;Over 900,000 tons to date

1 M tons/y shortly

CO2 Pipe to Injection Well

Final class VI permit

W.A. Parrish, TX: 1.4M tons/y CO2NRG/PetraNova project

Broke Ground Sept. 5th! Operational in2016

Policy Incentives and Regulatoryframeworks for CCS/CCUS in US

Technology – Market – Policy Dynamics

MARKET

Pull and SkewedBy Policy

TECHNOLOGY

Pushes Marketsand GuidesPolicy

POLICY/REGS

“Pubic Good” byShaping Market &Enabled by availableTechnology

• Federal Government– Support R&D

New TechnologyOptions

– Remove barriers& Lower hurdlesfor the publicgood.

– ProvideIncentives &Framework

BUSINESS CASEFOR CCS

FINANCEABILITYACCEPTANCE

US EPA REGULATIONS - CO2 EMISSIONS

54

EPA CLEAN POWER PLAN – ?? Supreme Court Stay• EMISSIONS REDUCTIONS ON STATE-BY STATE BASIS• CCS IS NOT DESIGNATED AS A REQUIRED

TECHNOLOGY, BUT MAY BE PART OF EMISSIONSCOMPLIANCE PLAN FOR STATES

NEW SOURCE PEFORMANCE STANDARDS• NEW COAL PLANTS MUST MEET 1400 LBS/MWHR;• CAN BE MET BY EITHER CARBON CAPTURE (~ 20%

CAPTURE) OR CO-FIRING WITH NATURAL GAS (40%GAS )

Funding CCS Projects in the United States

Federal Funding and Incentives for CCS• American Reinvestment and Recovery Act (ARRA)• U.S. DOE Office of Fossil Energy RD&D Program• Loan Guarantees• Tax Credits:

$20 per ton for Saline Storage$10 per ton for EOR

State Incentives for CCS• Financial Support – Loans and Grants• Tax Incentives• Off-take Agreements• Utility Cost Recovery Mechanisms• CCS Eligibility in Portfolio Standards• Assumption of Liability for Stored Carbon

Closing RemarksPolicy Incentives and Parity essential to CCS deployment aspart of a low-carbon technology portfolio for climate mitigation

Cost of capture and lack of carbon valuation are challenges forfinanceable CCS

CCUS: A catalyst for CCS – builds key infrastructures for CCS• CO2- EOR – Largest near-term potential for CCUS• Non-EOR - CO2 for Bio-based energy and “green” products• Mineralization Processes – to produce chemicals

CCS:• Dedicated storage needed for CO2; desalination potential• Fossil-CCS can backup intermittent renewables (PV, wind)• A key to negative carbon- BioEnergy-CCS and air capture• Only technology for reducing CO2 from industrial facilities

Modularity – as added deployment path to large-scale demos

International collaboration needed for broad CCS deployment