Economic Analysis
This section will answer a basic research question: Are Clean Coal Technologies an economically efficient means of Carbon Emissions Reduction?
No one combustion technology dominates positive economic returns at this stage in time and gasification is currently the least economically efficient. Because of the immense volumes of carbon dioxide, any program to reduce emissions from this power sector will require a balanced mix of renewable, nuclear and fossil fuels. Coal is domestic, reliable and fairly inexpensive thus it’s employed on a large scale which makes it impractical to replace in the near future. Based on this knowledge it is appropriate to invest in research and development for a range of technologies for carbon management of coal.
Through the assessment of relevant reports and results, this portion of our research aims to draw concrete conclusions on the performance and economics of Clean Coal Technologies for Carbon Capture and Emissions Reduction. Factors to be considered include usage statistics and basic cost/benefit analyses of widely utilized clean coal technologies as opposed to other carbon emissions reduction efforts.Using the financial model employed by M. O'Donnell, S. Provol and A. Panjaitan in €˜Comparisons of Environmental Quality, Performance and Economics of Clean Coal Technologies for Carbon Capture', this section highlights the actual economic viability of a number of carbon emission reduction options within the U.S.
Within this model, the estimates of the price of electricity and the cost of fuels were from studies conducted by the U.S Department of Energy, including the supplemental regional forecasts from the Energy Information Administration to define the business environment in 4 regions of the country to the year 2030.
The table below can be used as a reference point for these generating technologies and their respective costs.
The assessment was carried out by the Babcock & Wilcox Company to provide their customers (power plant owners), a true €˜cost of electricity'. For these customers to make a profit, these power plants must receive a positive Net Present Value (NPV) and its Internal Rate of Return (IRR) must meet the goals of such a large capital investment. Therefore these technologies were compared on the basis of NPV and IRR. The benchmark cases of a superficial boiler with no carbon capture, and an Intensified Gasification Combined Cycle with no carbon capture topped the list with 11.7% and 10% IRR's respectively.
Among the carbon-management technologies with the most promising results, based on the given assumptions was the Carbon dioxide scrubber using ammonium carbonate as the carbon dioxide solvent with 7.2%, Ultra-supercritical with oxy-fuel using 95% oxygen at 7.1% and IGCC with carbon management at 7.1%. The various technologies for carbon management are mixed in their rankings on NPV and IRR.