Optimal Spatial Deployment of Carbon Dioxide Capture and Storage Given a Price on Carbon Dioxide

Abstract

Carbon dioxide capture and storage (CCS) links together technologies that separate carbon dioxide (CO2) from fixed point source emissions and transport it by pipeline to geologic reservoirs into which it is injected underground for long-term containment. Previously, models have been developed to minimize the cost of a CCS infrastructure network that captures a given amount of CO2. The CCS process can be costly, however, and large-scale implementation by industry will require government regulations and economic incentives. The incentives can price CO2 emissions, through a tax or a cap-and-trade system, or involve the purchase of CO2 by oil companies for enhanced oil recovery from depleted oil fields. This paper extends the earlier mixed-integer linear programming model to endogenously determine the optimal quantity of CO2 to capture and optimize the various components of a CCS infrastructure network, given the prices to emit CO2 into the atmosphere or inject it into oil fields. The model minimizes the cost of capturing, transporting, storing, selling, or emitting CO2. The model is applied to a network of CO2 sources, CO2 reservoirs, and candidate CO2 pipeline links and diameters in California.

INTRODUCTION

According to the Intergovernmental Panel on Climate Change (IPCC 2007), "warming of the climate system is unequivocal," and "most of the observed increase in global average temperatures since the mid-20th century is very likely due to the observed increase in anthropogenic GHG [greenhouse gas] concentrations." Carbon dioxide (CO2) is the most worrisome GHG emission, in part because the energy resources (such as fossil fuels) and technologies upon which present-day economies are based emit enormous amounts of CO2 (e.g., IPCC 2005). Without intervention, CO2 emissions will continue to increase and at least double their 2004 levels by the middle of the century, and in order to stabilize CO2 emissions at their 2004 levels by 2054, approximately 26 Gt of CO2 emissions per year must be mitigated ((Pacala and Socolow 2004). Carbon capture and storage (CCS) is one existing technology that can be deployed among a portfolio of mitigation technologies to meet this challenge. CCS is costly, however, and will require credible and legitimate economic incentives in order to be deployed widely. Towards this end, this paper presents a geospatial optimization model that deploys integrated CCS systems over space as a result of these economic incentives....