Abstract
The deployment of CCS technology requires CO2 to be transported from capture- to designated storage-sites. For this purpose the creation of a CO2 pipeline transportation infrastructure is considered advantageous. In this chapter it is analyzed how the provision of a CO2 pipeline transportation infrastructure should be organized from an economic point of view. It is shown that a regulated or a private provision of the infrastructure is preferable depending on returns to scale property of the infrastructure on the system level. This property on its part depends on the spatial distribution of capture and storage sites, and of the volume transported.
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Notes
- 1.
Where waterways are accessible, the transportation of CO2 by ship can provide an alternative to pipeline transportation, in particular because this makes the construction of a pipeline infrastructure unnecessary.
- 2.
For more information on the technical aspects of CO2 pipelines, see Chap. 3.
- 3.
Legal issues including their economic implications for building a CCS infrastructure are discussed in Parfomak and Folger (2008).
- 4.
Decreasing/constant/increasing returns to scale: if the factor input is increased by the factor a, the transportation capacity increases by less than/equal to/greater than the factor a. Increasing returns to scale are equivalent to a decrease in average costs.
- 5.
- 6.
Bakken and von Streng Velken (2008) or Poiencot and Brown (2011), for example. Dooley et al. (2005) also analyze system costs, but restrict themselves to a simple source-sink matching heuristic. Fischedick et al. (2006) provide a technology-focused overview of infrastructure options for Germany in Chap. 9.
- 7.
- 8.
One of the reasons why this approximation is sufficient as the exponent of Q (4/5) is close to 1.
- 9.
- 10.
These methods were developed for the area of water network design. A comprehensive overview can be found in Jezowski (2010).
- 11.
Infrastructures can be classified according to their spatial structure. Connected infrastructures, of which at least one infrastructure element is used as a production factor for several independent transports, is referred to as a network infrastructure.
- 12.
These can include significant cost reductions achieved by reducing planning efforts by building a new infrastructure close to existing infrastructures.
- 13.
As capture and storage costs were taken into account in this example in addition to the infrastructures, costs are not referred to here as infrastructure costs but as system costs.
- 14.
Including 21 gas power plants, 1 coal power plant, 10 oil refineries, and 5 cement works.
- 15.
Although it is expected that infrastructure costs only make up a small share of CCS system costs in Germany and the USA (e.g. McKinsey 2008), they can have a decisive impact on the system cost curve.
- 16.
Comprising 3 refineries, 3 cement works, 6 power plants (4 gas power plants and 2 coal power plants).
- 17.
These findings also explain the results of Wildenborg et al. (2004): ‘The backbone transport infrastructure becomes cost optimal when storage is restricted to offshore hydrocarbon fields. The costs amount to 9.74 €/t CO2 without backbone and equal 4.48 €/t CO2 with backbone.’ However, their method for determining the backbone infrastructure is not transparent.
- 18.
At an average exchange rate of $ 1 = € 0.7 in 2009.
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Geske, J. (2015). CCS Transportation Infrastructures: Technologies, Costs, and Regulation. In: Kuckshinrichs, W., Hake, JF. (eds) Carbon Capture, Storage and Use. Springer, Cham. https://doi.org/10.1007/978-3-319-11943-4_9
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