System Dynamics of Carbon Capture and Storage

A techno-economic analysis of carbon capture and storage (CCS) is presented using system dynamics. These models fully couple the CCS subsystems of carbon dioxide (CO2) capture, transport, and storage as an integrated system with feedback and control. Simulations are presented for CO2 captured from and stored proximal to a liquified natural gas (LNG) export facility along the Texas and Louisiana Gulf Coast. The simulations demonstrate that CCS is a dynamic system influenced by disequilibria, such as reservoir injectivity and varying pressures and flow rates, rather than a quasi-static mass balance operation. Key insights reveal that, within the maximum 45Q tax credit value of $85 per ton of CO2 and 12-year qualification period, an LNG-related CCS project at its final investment decision could be economically viable when levelized costs of carbon capture are below about $27 per ton of CO2. This breakeven cost of capture increases to about $36 per ton of CO2 if the 45Q tax credit qualification period is extended from 12 to 20 years. This analysis excludes the impact of any tax strategies utilizing 45Q tax credits. However, economic viability at the projects’ initial investment decision is highly dependent on inflation and the time required for permitting, construction, and post-injection monitoring, as well as the CCS operator’s expected returns. Specifically, modest cost escalation or delays in permitting or construction, common phenomena in major capital projects, significantly reduce the economic viability of CCS even with favorable subsidies under the Inflation Reduction Act. This work has implications for policymakers and industry stakeholders: it challenges the assumption of CCS as a standalone solution for carbon abatement across all industry sectors and underscores the necessity for systems-level design and operations to maximize CCS efficiency and economics.

Name thesis:degree_name

Master

Department dc:contributor.department

Sloan School of Management

Grantor dc:publisher

Massachusetts Institute of Technology

Year dc:date.issued

2024

Author dc:creator

• Wilson, Glenn Andrew

Advisor dc:contributor.advisor

• Sterman, John D.

Statement dc:rights

• In Copyright - Educational Use Permitted
• Copyright retained by author(s)

Licence dc:rights.uri

• https://rightsstatements.org/page/InC-EDU/1.0/

Handle dc:identifier.uri

https://hdl.handle.net/1721.1/156041

OAI identifier oai:identifier

oai:dspace.mit.edu:1721.1/156041