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Why CCS is needed in emerging countries?
Unique challenges for CCS demonstration Financing CCS Demonstration Need and role
of various support mechanisms ADBs support in PRC to enhance CCS demonstration Levers enable CCS demonstration projects in pipeline in emerging economies Conclusions
technology to decouple CO2 emissions into the atmosphere from large single-point sources of fossil fuel combustion
3
5000
Electricity generated GWh
1GW Solar
3000
Each GW of coal fired power generation with CCS avoids more CO2 than avoided by 1GW each of solar and wind plants combined.
Lack of experiences in planning, constructing and operating power plants with CCS
Limited technical readiness of asset base Higher additional CAPEX, OPEX & auxiliary consumptions
120
Using captured CO2 for EOR could allow for additional revenue and enhance viability of projects
90 65% 80%
90
600
24%
73
200
400 MW IGCC
01/10/2010
600 MW SC
01/10/2010
But ..
Benchmark tariff for coal-fired power plants without CCS are applied to those with CCS which make them financially unviable at the existing tariff.
120 800 75 73 65% 67 60 400 Base Cost $226 M Base Cost $226 M 51 30 90
600
24%
Concessional financing could bring with CCS down so that it would require only a tariff mark-up of 20%.
200
400 MW IGCC
07/10/2010
600 MW SC
07/10/2010
0.19 $/kWh
0.2
0.05
0.05
Comparing a coal-fired with CCS to a without CCS plant neglects environmental impacts of coal-fired power plants without CCS
Tariff ($/kWh)
2.5
0.15
Capital investment support measures Supply side need to be complemented with an appropriate mix of supply side operation oriented support as well as demand side stimulus measures
Demand side
Investment grants Concessional financing Sovereign guarantees Exemption on import duties Quota obligations
Government Commitment, incl. policy targets, regulatory, fiscal, and financial support measures
Concessional financing and adequate business models for early stage demonstration projects Higher upfront development costs, capital investment cost, and auxiliary consumption Awareness and support from civil society
11
Oxyfuelcombustion technology:
Financial and technical assistance to China Huaneng Group to study the technology, build and operate an Integrated Gasification Combined Cycle power plant with a carbon capture, utilization and storage plant
12
ADB is working with the National Development and Reform Commission to formulate a comprehensive roadmap, policy, and regulations to enable CCS demonstration and deployment
Business Models:
ADB in consultation with major oil, gas, coal mining, and power industries seeks to identify and facilitate joint ventures for early stage demonstration projects
Knowledge transfer:
ADB organizes international conferences or site visits for PRC stakeholders to facilitate knowledge sharing and exchange on good practices in CCS development
13
CCS partnership with the CCI, stakeholder in the CSLF, Member Global CCS Institute Participation in Action Group to identify and establish a CCS financing mechanism in developing countries
14
Conclusions
CCS technologies face unique challenges Compelling reasons to fast track CCS demonstration in developing countries MDBs have a critical role to play in capacity development and creating enabling environment
Conclusions
Compelling reasons to fast track CCS demonstration in developing countries
Ashok Bhargava, Director East Asia Energy Division (EAEN) abhargava@adb.org Annika Seiler, Finance Specialist (Energy) EAEN aseiler@adb.org
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