GLOBAL CCS INSTITUTE

THE GLOBAL STATUS OF CCS: 2010

& FINANCE WORK GOING FORWARD
Larry Hegan, Senior Policy Adviser

WWW.GLOBALCCSINSTITUTE.COM
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The Global Status of CCS: 2010 (March 2011)

 Government Funding
 Project Status
 CO2 Storage
 CO2 Networks All these issues have to
 Legal and Regulatory
be addressed to reduce
Developments risks and improve
 CCS Costs risk/return ratio for
 Knowledge Sharing financial sector
Initiatives
 Public Engagement
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…. in order to incent and advance projects

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…. and advance CCS through the overall

technology development cycle
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History highlights why we need to accelerate CCS

Rubin and all (2007)

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High costs and low revenues = ‘economic gap’

Carbon EOR Econ = Need for Public

Price Revenue Gap Funding
$/t $/t
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… public funding required so far as been large

Power Sector:
• TransAlta Project Pioneer (Canada) US$770M
• ROAD Project (Netherlands) US$437.6M
• Southern Company IGCC (U.S.) US$705M
• AEP Mountaineer (U.S.) US$334M

Industrial Sector:
• Quest CCS Project (Canada) US$861M
• Lake Charles Gasification (US) US$399M Only one
• Gorgon (Australia) US$59M to reach
FID
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Funding does not necessarily = reducing risks to

help unlock private investment at reasonable costs

• Cost uncertainty (+/- 40%), cost overruns

• Technical risk for capture (performance, reliability,
integration)
• Storage risk (locating and proving viable capacity,
leakage)
• Sovereign risk (e.g. uncertainty over carbon price)
• Commercial risk (e.g. fluctuating $/kwh price for
electricity, EOR contracts)
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Finance issues addressed across the work plans
of the Institute
Financial and Commercial (F&C) Team:
1. Financial Model – with Japan Bank for
International Cooperation
2. Evaluating Financial Support Structures –
with Clinton Climate Initiative
• Market sounding on impacts of risk on
financing
• Structures to facilitate private sector
financing
• Developed vs Developing Countries
3. Identifying funding mechanisms for CCS
projects in developing countries
4. F&C ‘Centre-of-Excellence’/Knowledge
Sharing Network
5. Cost benchmarking survey
• Comparing between CCS projects
6. F&C Steering Group
Policy, Legal, Regulatory Team:
• Inform inclusion of CCS in UNFCCC – incl.
CDM, GreenFund, Tech Centres
• Issues paper on CCS networks
• Quarterly issues papers on nature and
sufficiency of CCS incentives policy
Chief Economist:
• Cost Analysis
• Comparison across technologies
• Cost reduction opportunities
• Commercial pathways for CCS
• Financial liability for stored CO22
• Funding database
Capacity Development Team:
• Countries of Focus / Engagement
Strategies: China, India, Indonesia,
Malaysia, Mexico, South Africa
• Partnerships with ADB, World Bank, UNIDO
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Collecting insights from projects, financial

community, technology providers, etc.

Including
from projects
the Global
CCS Institute
is supporting
directly …

10
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Finance knowledge sharing ‘hub’ on digital

platform
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THANK YOU
larry.hegan@globalccsinstitute.com

www.globalccsinstitute.com