Economic Feasibility of CO2

Capture Retrofits for the

U.S. Coal Fleet: Impacts of
R&D and CO2 EOR Revenue

Use Picture of Existing Fleet Map

Michael Matuszewski
Energy Analysis Briefing
June 26th, 2013

the ENERGY lab

Objectives
In a 2nd Generation CO2 Capture Market (2030) with No
Carbon Regulations, Compare BAU to Retrofit for EOR
Determine Economic Feasibility of Carbon Capture
Retrofits in an Enhanced Oil Recovery (EOR) market
Capture CO2 and sell for enhanced oil production

Determine how 2nd generation capture technologies can

improve retrofit economics
Cost to capture CO2 at plant gate

Assess economic sensitivity to key market variables

Economic life, dispatch, oil prices
* Image from www.clker.com

Executive Summary
Database of design and operational details for existing PC
units allows extrapolation of CO2 retrofit cost and
performance
~1,350 units comprising 324 GW of nameplate generation
Capital, operating cost and performance extrapolations
This analysis evaluates only CO2 capture - no criteria pollutant costs

2nd gen capture technology reduces fleet-wide captured

costs by ~25%
2030 projected oil prices ($138/bbl) may further promote capture
2nd gen may increase candidate retrofit GWs five-fold over SOA

EOR revenue promotes more competitive dispatch

With EOR revenue, CO2 capture may increase dispatch in power markets
Reasonable CO2 prices ($10-$30/tonne) can eliminate marginal cost
increases due to capture

2nd Generation Projections

Overview

By convention, technology evaluations

performed on baseline greenfield plant

Conceptual, 550MW greenfield installation

Includes benefits of A-USC Steam cycle

New

generation CO2 capture performance

projections based on greenfield plant
capture technology contributing to target
of $40/tonne captured
Apply same capture technology to
baseline existing plant

2nd

Retain existing limitations such as fixed

steam cycle, current heat rate, etc.
Cost of lost power generation
Often requires additional equipment &
effort
Consequently, existing plant cost of
captured is generally >$40/tonne
greenfield target (@ constant CF)

Existing

CCS

CCS

Baseline Existing Plant

A baseline existing plant is
established for conceptual
evaluation of retrofitted CO2
technologies on a consistent basis
Allows evaluation of system-wide
effects on power plant
Isolates net power generation
penalty due to CO2 capture
retrofit

Baseline Existing Plant is equivalent to a subcritical

pulverized coal plant without carbon capture, as
defined in NETL report Cost and Performance
Baseline for Fossil Energ y Plants (Case 9)
* Image from www.clker.com

Extrapolating Results to the Existing Fleet

Existing Plant Database

Data on 1,355 individual PC units (324 GW)
Key information:
Unit ID, Nameplate Capacity, Heatrate, CO2 Emissions,
Capacity Factor

CO2 Generation Allows Calculation of:

CO2 Captured, Capital Costs, Fixed O&M*, Variable O&M**

Heatrate and Nameplate Capacity Allow Calculation of:

Post-Retrofit Output, Lost Power Revenue***

Capacity Factor Allows Calculation of:

Cost of CO2 Captured, Incremental COE/Marginal Costs
*Proportional
**

to TPC
Proportional to amount of CO2 Captured

***Assuming

a market price of electricity

Technology Comparison
Baseline PC Plant Retrofit (comparison to 2012)
Metric

Technology Vintage
2005*
2012*
Example
2nd Gen.

Net Energy Penalty

[kWhnet/lb CO2 Captured]

0.181
(+26%)

0.144

0.143
(-1%)

Reference Capital Cost

[$/tpd CO2 Capt. @ full load]

$55,400
(-17%)

$66,400

$48,000
(-28%)

Incremental Fixed O&M

[$/tpd CO2 Capt. @ full load]

$1,828
(-5%)

$1,926

$1,872
(-2.8%)

Incremental Variable O&M

[$/tpd CO2 Capt. @ full load]

$2.59
(-50%)

$5.13

$4.75
(-7%)

CO2 Capture Basis [tpd]

11,216

11,216

11,216

Basis

* Based on amine technology

Equipment Cost Scaling (2011 dollars)

CO2 Compression TPC

CO2 Capture TPC

Reference

$1,200,000

y = 1747.4x0.6374

y = 143.51x0.6093

$70,000

$1,000,000

$60,000

$1000

$800,000

$1000

Reference

$80,000

$600,000
y = 1359.1x0.6374
$400,000

5B.1 TPC (1
train)
5B.1 TPC (2
trains)

$200,000
$0
0

5,000

10,000

15,000

20,000

25,000

$50,000
$40,000

y = 109.46x0.6093

$30,000

5B.2 TPC (1
train)
5B.2 TPC (2
trains)

$20,000
$10,000
$0
0

30,000

5,000

BoP

25,000

30,000

Reference

$18,000

y = 416.03x0.6501

$16,000

$250,000

y = 1908.7x0.2241

$14,000

$200,000

$1000

$1000

20,000

Letdown Turbine
$20,000

Reference

$300,000

15,000

TPD Captured CO2 @ Full Load

TPD Captured CO2 @ Full Load

$350,000

10,000

$150,000

$12,000
$10,000
$8,000
$6,000

$100,000

$4,000

$50,000

$2,000
$0

$0
0

5,000

10,000

15,000

20,000

25,000

TPD Captured CO2 @ Full Load

30,000

5,000

10,000

15,000

20,000

25,000

TPD Captured CO2 @ Full Load

30,000

Net Derate Projections*

Net Output Penalties of CCS Retrofits
40%

Power Penalty [% of original output]

35%

30%

Includes:
Regeneration Energy
Capture Electrical
Compression Electrical
Off-design ST Operation

0.184 kWh/lb

Thermodynamic
Advancements

0.144 kWh/lb
0.143 kWh/lb

25%

0.113 kWh/lb

20%

15%

0.048 kWh/lb

10%

PC-2005 Amine
PC-2012 Amine

5%

PC-Sorbent Based
PC-Membrane Based

0%
7,000

Ideal Power Penalty

8,000

9,000

10,000

11,000

Pre-Retrofit Heat Rate [BTU/kWh HHV]

*As evaluated on baseline existing plant. Does not include balance of plant improvements

12,000

13,000

CO2 Captured Cost Metric

CCF * TOC + LP * PP * 8760 * CF + FOM + VOM * CF
CapturedCost =
AnnualCO2Captured

Where:

Cost of lost power generation

Captured Cost [=] $/tonne

TOC = Total Overnight Cost [=] $
CCF = Capital Charge Factor [=] yr-1
LP = Lost Power [=] MW
PP = Market Power Price [=] $/MWh
CF = Capacity Factor [=] (fraction)
FOM = Fixed O&M [=] $/yr
VOM = Variable O&M [=] $/yr @ 100% load
Annual CO2 Captured [=] tonnes/yr

Plant-gate cost to capture CO2 defined as key metric

for retrofit evaluation in EOR market.

Existing Plant Retrofit Projections

2030 EOR Market with No CO2 Regulations

2030 Oil Prices May Support EOR CO2 Prices

that are Equal to or Above CO2 Capture Costs
80

CO2 EOR Price at Power Plant Gate

CO2 Capture Cost
($/tonne)

70

Prohibitive CO2 Prices

60

Todays Coal with CC

$61

50
Greenfield 2nd Gen CC

40

$42

30
20

Favorable CO2 Prices

10
0
20

40

60

80

100

WTI ($/bbl)

120

140

$138/bbl*

160

180

From 2008 to mid-2011, the average annual new contract price for CO2 ($/MSCF) at the Denver City, Texas hub, varied between 1.8% and 2.5% of the average annual WTI Crude oil price ($/bbl) in the corresponding
years. Expressed in $/tonne, this is 34% to 47% (at standard conditions of 60 F and 14.7 psia). (The non-averaged contract prices ($/MSCF) varied between 1.4 and 3.3% of the oil price between 2008 and mid-2011.)
Source: Chaparral Energy US CO2 & CO2 EOR Developments Panel Discussion at CO2 Carbon Management Workshop December 06, 2011. Estimated 100 km pipeline transport cost of $3.65/tonne is subtracted to
convert the historical hub price to an estimated power plant gate price.

*NEMS Projection

350

Cumulative Retrofits (GW pre-retrofit)

300

250

Incremental Marginal Cost Trends

Retrofitting SOA CO2 Capture
Reasonable CO2
revenue supports
higher dispatch
$10/tonne CO2

But to what level?

Retrofit: Increased
O&M, lost power
revenue

200

150

$30/tonne CO2

Pre-Retrofit
Post-Retrofit - no EOR Revenue

100

Post Retrofit w/CO2 Revenue

($10/tonne)

50

Post Retrofit w/CO2 Revenue

($30/tonne)
0
-60

-40

-20

0
20
40
60
Marginal Costs w/CO2 Revenue [$/MWh]

80

100

Effect of Dispatch - 2030

Capacity Factor Parameter Sensitivity
30yr CCF
$75/MWh*
power price
$138/bbl oil*

Cumulative Retrofits Incentivized (GW pre-retrofit)

350

State
of the Art
2nd Generation

Increase to 75% CF

300

Increase to 85% CF

250

~24% decrease in top

decile CO2 price

200

2nd
Gen

In 2030, 2nd gen

capture could
saturate EOR market

150

100

State
of the
Art

50

32.4GW

(top decile)

Possible
CO2 Prices
within
historical range

Probable
CO2 Prices
below
historical range

-50

Note shift from

EOR revenues @
$100/bbl

Existing CF

Unlikely
CO2 Prices
above
historical range

10
20
70
80
30
40
50
60
Minimum Plant Gate CO2 EOR Revenue Required to Incentivize CCS ($/tonne)
Probable
CO2 Prices
below
historical range

Possible
CO2 Prices
within
historical range

*NEMS Projections. Capital costs reflect ~15% premium due to increase in oil prices.

Unlikely
CO2 Prices
above
historical range

90

Effect of Capital Recovery Period - 2030

Capital Charge Factor Parameter Sensitivity
85% CF
$75/MWh
power price
$138/bbl oil

Cumulative Retrofits Incentivized (GW pre-retrofit)

350

State
of the Art
2nd Generation

30yr
20yr

300

10yr

250

~27% decrease in
top decile CO2 price

200

Short-term (10yr)
investment viewpoints
reduce viability by ~90%!

150

100

2nd Gen State of the Art

30yr

50

32.4GW

20yr

(top decile)

10yr

Probable
CO2 Prices
below
historical range

-50
0

Possible
CO2 Prices
within
historical range

Unlikely
CO2 Prices
above
historical range

10
20
30
40
60
70
80
50
Minimum Plant Gate CO2 EOR Revenue Required to Incentivize CCS ($/tonne)

90

Conclusions
Compared cost of CO2 retrofits to minimum CO2 price in EOR market
Bounding scenario: Calculations indicate best case for BAU vs. retrofit
In 2030, SOA technology promotes 0-45GW of economic retrofits*
2nd gen improvements increase potential up to five-fold (25-215GW)*
CO2 contract price relationship to price of WTI crude

EOR market while limited in size, is an excellent transition step for

proving out carbon capture and reducing risk for future installations
Still need help for slam dunk EOR scenario
Need CO2 capture R&D success!
Dispatch is essential and likely achievable
Regulatory drivers encouraging CO2 capture should also support a longterm (30yr) investment viewpoint

EOR revenue will offset lost power revenue, reducing marginal costs
$10/tonne nearly offsets marginal cost increases for entire fleet
$30/tonne eliminates marginal costs ($0/MWh) for ~150GW
*Range dictated by capital recovery period range (10-30yrs) assuming fleet-wide CF increase to 85%

Acknowledgements
NETL
John Wimer Project Guidance
Kristin Gerdes Sensitivity Analyses
Robert Stevens 2nd Gen Technology Projections

Booz Allen Hamilton

Vince Chou Cost and Performance Extrapolation

Leonardo Technologies Inc.

Massood Ramezan Project Guidance
Connie Zaremsky Database Management
Eric Lopert Data Generation

Questions?

Auxiliary Slides

Projected EOR Demand for CO2

CO2 Stored
8 billion tonnes
Increased Oil
Production
28 billion bbls

Million tonnes CO2 per year

300
250

CO2
Supplied
from 38 GW
of Coal Power
with CCUS

200
150
100
50
0
2010

2030

Natural Sources
Industrial Sources
Total Demand

2050

2070

2090

Natural Gas Processing

Coal with CCUS Potential

FROM
ASSESSMENT
OF NEW PLANT
GOALS

CEPI Relationship to WTI and CPI

4.5

4.0
WTI = WTI
R = 1

3.5

CEPI & CPI [2004]

3.0

2.5

CEPI
WTI
CPI

2.0

CEPI = 0.1284*WTI + 0.9825

R = 0.597

1.5

1.0

CPI = 0.0201*WTI + 1.0109

R = 0.1841

0.5

0.0
0.0

0.5

1.0

1.5

2.0
2.5
WTI Index [2004]

3.0

3.5

4.0

4.5

Deviation of CEPI from CPI

1.6
y = 0.1x + 0.9777
R = 0.6713

1.4

1.2

CEPI:CPI [2004]

1.0

0.8

0.6

0.4

0.2

0.0
0.0

0.5

1.0

1.5

2.0
2.5
WTI [2004]

3.0

3.5

4.0

4.5

Effect of Dispatch - 2017

Capacity Factor Parameter Sensitivity
30yr CCF
$60/MWh
power price
$100/bbl oil

Cumulative Retrofits Incentivized (GW pre-retrofit)

350

State
of the Art
2nd Generation

300

250

~23% decrease in top

decile CO2 price

200

2nd

Gen

150

State
of
the
Art

100
Existing CF
CF
Existing

50

Increase to
to 75%
75%CF
CF
Increase
Increase to
to 85%
85%CF
CF
Increase

Probable
CO2 Prices
below
historical range

-50
0

Possible
CO2 Prices
within
historical range

Unlikely
CO2 Prices
above
historical range

10
20
30
40
50
60
70
80
Minimum Plant Gate CO2 EOR Revenue Required to Incentivize CCS ($/tonne)

90

Effect of Excluding Plants Online Prior to 1970

Sensitivity to Age
300

43

250

34

2nd Gen CCS

Retrofit
Technology

200

26
150
17
100

Ranges based on a $100/bbl

oil price projected for 2017
(AEO2012 Reference Case)

50

Today's CCS
Retrofit
Technology

8.5

Possible
CO2 Prices
within
historical range

-50
30

Unlikely
CO2 Prices
above
historical range

40
50
60
70
80
Minimum Plant Gate CO2 EOR Revenue Required to Incentivize CCS ($/tonne)

90

Cumulative CO2 Stored in 30 yrs (Gigatonnes)

Cumulative Retrofits Incentivized (GW pre-retrofit)

350

Cost Refinements
NGCC*

Component

2012

2005

2012

2005

Capital

38.0

34.8

28.7

20.7

Fixed O&M

19.3

21.0

5.8

6.9

Variable O&M

16.3

16.2

5.3

3.5

Fuel

36.1

39.5

49.1

52.2

CO2 TS&M
Total
[$/MWh]

10.2

11.2

3.6

3.8

120.0

122.7

92.4

87.1

120
100

COE [2011 $/MWh]

PC

140

CO2 TS&M

80

Fuel
Variable O&M

60

Fixed O&M
Capital

40
20
0

2012-PC

Notes:
Full NGCC system analysis not done
NGCC costs estimated
2012 capital higher
2012 results in higher estimated COE for NGCC
Relatively small NGCC performance

2005-PC

2012-NGCC

2005-NGCC

Net Derate Contributions

0.2500

Energy penalty
[kWh/lb captured CO2]

Electrical Derate

0.2000

Steam Turbine Derate

2005

PC: ~30%
reduction in
regeneration
energy penalty

0.1500

0.1000

0.0500

57%

61%

64%

69%

NGCC-2012

PC-2012

NGCC-2005

PC-2005

0.0000

NGCC: ~15%
reduction in
regeneration
energy penalty

Off-Design Steam Turbine Penalty

Performance Comparison - PC
Steam Turbine Power
TOTAL POWER, kWe
AUXILIARY LOAD SUMMARY, kWe
Coal Handling and Conveying
Pulverizers
Sorbent Handling & Reagent Preparation
Ash Handling
Primary Air Fans
Forced Draft Fans
Induced Draft Fans
SCR
Baghouse
Wet FGD
Amine System Auxiliaries
CO2 Compression
Miscellaneous Balance of Plant1
Steam Turbine Auxiliaries
Condensate Pumps
Circulating Water Pumps
Ground Water Pumps
Cooling Tower Fans
Transformer Losses
TOTAL AUXILIARIES, kWe
NET POWER, kWe
Net Plant Efficiency, % (HHV)
Net Plant Heat Rate, kJ/kWh (Btu/kWh)
CONDENSER COOLING DUTY, GJ/hr (106 Btu/hr)
CONSUMABLES
As-Received Coal Feed, kg/hr (lb/hr)
Thermal Input, kWt
Raw Water Withdrawal, m3/min (gpm)
Raw Water Consumption, m3/min (gpm)

2012 Amine

2005 Amine

500,300
500,300

467,600
467,600

450
2,970
970
570
1,390
1,780
8,640
50
70
3,180
14,020
34,700
2,000
400
610
7,080
640
3,660
1,670
84,850
415,450
27.8%
12,958 (12,282)
1,798 (1,704)

450
2,970
970
570
1,390
1,780
8,640
50
70
3,180
15,900
34,700
2,000
400
490
8,070
730
4,180
1,640
88,180
379,420
25.4%
14,188 (13,448)
1,450 (1,375)

198,391 (437,378)
1,495,381
26.6 (7,035)
20.4 (5,396)

198,391 (437,378)
1,495,381
30.5 (8,052)
23.4 (6,184)

Extrapolation - Performance
We can extrapolate performance to arbitrary PC plants
Assumptions:
1. Steam extraction results in off-design penalty
2. Letdown turbine required only for PC plants
3. Fixed CO2 generation
a. Coal 205 lb CO2/MMBTU
b. NG 118 lb CO2/MMBTU
4. CC energy penalty independent of total CO2
captured

Extrapolation - Costs
We can extrapolate costs to arbitrary PC plants
Assumptions:
1. 2011 Dollars
2. Letdown turbine required only for PC plants
3. CC energy penalty independent of total CO2
captured
4. Labor Costs - Midwest, Merit Shop $39.70/hr
5. Taxes & Ins. 2% of TPC

Extrapolation Costs (contd)

Assumptions (contd):
7. General Capital Scaling: A*(tpd)
a. Covers LDT, CCS, Compression, BOP
b. BOP = ducting, stack, steam piping, electrical,
I&C, site improvements, buildings and
foundations
8. Maximum capture system ~16,000 tpd CO2
a. Two CCS trains above this value; lose econ. of
scale
b. Built-in logic chooses lowest cost option

Performance Comparison - NGCC

POWER SUMMARY
(Gross Power at Generator Terminals, kWe)
Gas Turbine Power
Steam Turbine Power
TOTAL POWER, kWe
AUXILIARY LOAD SUMMARY, kWe
Condensate Pumps
Boiler Feedwater Pumps
Amine System Auxiliaries
CO2 Compression
Circulating Water Pump
Ground Water Pumps
Cooling Tower Fans
SCR
Gas Turbine Auxiliaries
Steam Turbine Auxiliaries
Miscellaneous Balance of Plant1
Transformer Losses
TOTAL AUXILIARIES, kWe
NET POWER, kWe
Net Plant Efficiency, % (HHV)
Net Plant Heat Rate, Btu/kWh
CONDENSER COOLING DUTY, MMBtu/hr
CONSUMABLES
Natural Gas Feed Flow, kg/hr (lb/hr)
Thermal Input (HHV), kWth
Raw Water Withdrawal, gpm
Raw Water Consumption, gpm

2012 Amine

2005 Amine

362,200
160,382
522,582

362,200
148,800
511,000

100
2,720
14,080
15,200
3,920
330
2,020
10
700
100
500
1,560
41,240
481,342
43.5%
7,839
630

80
2,710
9,600
15,200
4,360
360
2,250
10
700
100
500
1,560
37,430
473,570
42.8%
7,968
500

75,901 (167,333)

75,901 (167,333)

1,105,812
3,640
2,740

1,105,812
3,992
2,985