Research on Carbon Capture and Storage Investment Decision-making for Coal-fired Power Plants Based on Emission Reduction

Author:Chen Wen Hui

Supervisor:lei ya lin


Degree Year:2019





In the context of advocating energy conservation and emission reduction,and developing low-carbon economy to cope with climate change,the research and development of low-carbon technology has become an important way to reduce CO2emissions.Carbon Capture and Storage(CCS)technology has been accepted as a critical technology to obtain significant carbon emission cuts form coal-fired power plants which ranks first in carbon emissions in China.However,CCS technology is a highly complex and comprehensive system,which has the characteristics of high investment,large irreversible risk,and high uncertainty of payoff.Therefore,it is necessary to scientifically and completely evaluate the value of CCS projects and make reasonable investment decisions.At present,scholars focused on the cost of one or several links of CCS technology,while few researchers analyze the techno-economic of full CCS process.Thus,previous researches focused on CCS retrofitting investment decision regarding existing coal-fired power plants from the perspective of power enterprises.Moreover,the traditional net present value method(NPV)failed to consider flexibility and uncertainty of CCS investment.Therefore,based on techno-economic analysis,trinomial tree modeling was developed to evaluate the investment of CCS project,considering multiple uncertainties such as carbon price,electricity tariff and subsidy,technical progress,carbon tax and oil price.The innovative results achieved by this study mainly include:(1)For different means of carbon capture and storage,the full-chain CCS technology investment decision-making model based on real option for coal-fired power plants has been built.By improving the binary tree pricing method,and the trigeminal tree and Monte Carlo simulation pricing model are used to describe the CCS investment decision-making process and value formation mechanism more accurately,so as to improve the accuracy of investment value calculation.Further,a sensitivity analysis is conducted to investigate the effects multiple uncertainties of on investment under different scenarios.(2)By improving the value method of variables in the real option model,the accuracy of prediction results of technological progress and crude oil price is improved.In order to quantify the effects multiple uncertainties of on investment value more accurately and reduce calculation deviation,the estimation method for parameters in the real option model be modified.To settle the drawbacks of the one-factor learning model by bringing in component-based learning model,which is especially suitable to yield a relatively accurate learning rate for CO2 capture technology.Moreover,the"jump"process is introduced in the geometric Brownian motion model to simulate the irregular and large jump of the crude oil price caused by the emergency.(3)This paper defines and calculates the cost of each link in CCS technical and economic evaluation involved in real option model in detail.It overcomes the shortcoming of incomplete cost estimation in previous studies which only considered part of CCS system or directly used the foreign costs to evaluate the application of CCS technology in China.