Valuation and investment strategies of carbon capture and storage technology under uncertainties in technology, policy and market

Huang, Chao; Chen, Lifei; Tadikamalla, Pandu R.; Gordon, Mikhail

doi:10.1080/01605682.2019.1678402

“…Comparing the net present value of various types of power plants integrated with carbon capture technology, pulverised coal was the cheaper option under low carbon prices. Simultaneously, the IGCC power plants were desirable only when the carbon price was high (Huang et al 2020;Bohm et al 2007). Thus, the carbon pricing is considered as one of the most effective ways to encourage the deployment of carbon capture and storage technologies.…”

Section: Introductionmentioning

confidence: 99%

Recent advances in carbon capture storage and utilisation technologies: a review

Osman

¹

,

Hefny

²

,

Maksoud

³

et al. 2020

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Human activities have led to a massive increase in $$\hbox {CO}_{2}$$ CO 2 emissions as a primary greenhouse gas that is contributing to climate change with higher than $$1\,^{\circ }\hbox {C}$$ 1 ∘ C global warming than that of the pre-industrial level. We evaluate the three major technologies that are utilised for carbon capture: pre-combustion, post-combustion and oxyfuel combustion. We review the advances in carbon capture, storage and utilisation. We compare carbon uptake technologies with techniques of carbon dioxide separation. Monoethanolamine is the most common carbon sorbent; yet it requires a high regeneration energy of 3.5 GJ per tonne of $$\hbox {CO}_{2}$$ CO 2 . Alternatively, recent advances in sorbent technology reveal novel solvents such as a modulated amine blend with lower regeneration energy of 2.17 GJ per tonne of $$\hbox {CO}_{2}$$ CO 2 . Graphene-type materials show $$\hbox {CO}_{2}$$ CO 2 adsorption capacity of 0.07 mol/g, which is 10 times higher than that of specific types of activated carbon, zeolites and metal–organic frameworks. $$\hbox {CO}_{2}$$ CO 2 geosequestration provides an efficient and long-term strategy for storing the captured $$\hbox {CO}_{2}$$ CO 2 in geological formations with a global storage capacity factor at a Gt-scale within operational timescales. Regarding the utilisation route, currently, the gross global utilisation of $$\hbox {CO}_{2}$$ CO 2 is lower than 200 million tonnes per year, which is roughly negligible compared with the extent of global anthropogenic $$\hbox {CO}_{2}$$ CO 2 emissions, which is higher than 32,000 million tonnes per year. Herein, we review different $$\hbox {CO}_{2}$$ CO 2 utilisation methods such as direct routes, i.e. beverage carbonation, food packaging and oil recovery, chemical industries and fuels. Moreover, we investigated additional $$\hbox {CO}_{2}$$ CO 2 utilisation for base-load power generation, seasonal energy storage, and district cooling and cryogenic direct air $$\hbox {CO}_{2}$$ CO 2 capture using geothermal energy. Through bibliometric mapping, we identified the research gap in the literature within this field which requires future investigations, for instance, designing new and stable ionic liquids, pore size and selectivity of metal–organic frameworks and enhancing the adsorption capacity of novel solvents. Moreover, areas such as techno-economic evaluation of novel solvents, process design and dynamic simulation require further effort as well as research and development before pilot- and commercial-scale trials.

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“…And it can be seen the price of BYD is overrated, and the price of LONGI is underestimated. In the CAPM model, firstly, the beta of each stock is derived from the covariance of the stock to the SSE market and the ratio of the returns, then the value of the final CAPM is derived from the difference between the average of the yields of these firms and the mean of the yields of the SHIBOR [7][8]. In the process of using the momentum analysis model, when the average closing price of each stock over the past 50 days is greater than the average closing price of the last 200 days, the stock is worth investing in momentum analysis.…”

Section: Investment Analysismentioning

confidence: 99%

Value Analysis Based on Investment in the New Energy Industry

Cheng

2023

HBEM

0

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New energy is an environmentally friendly industry that includes lithium batteries, new energy vehicles, and many other sub-industries that are gradually replacing traditional fossil fuel energy, and is a hot spot in society and an emerging industry that needs to be promoted urgently. Based on the new energy industry's rapid development and surge of heat, the study of the investment situation of the whole industry, represented by three companies involved BYD, CATL, and LONGI green energy was launched. The research indicated that the new energy industry is a growing industry, risks and opportunities at the same time, and various types of investors may choose this industry. In the final analysis, the purpose of this essay is to explore the commonalities and characteristics of different companies in the same industry in the hope of summarizing the patterns and general direction of investment in the new energy industry at this stage.

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“…CCS projects are also prone to policy uncertainty and the impact of different subsidy modes, in particular. Hence, Huang et al [53] modelled the uncertainty of subsidies by a Poisson jump process in their evaluation of a CCS technology to characterize the uncertain timing and level of government subsidies.…”

mentioning

confidence: 99%

Using Real Options Thinking to Value Investment Flexibility in Carbon Capture and Utilization Projects: A Review

Assche

¹

,

Compernolle

²

2022

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Carbon capture and utilization (CCU) is one of the key technologies that may help to reduce industrial emissions. However, the deployment of CCU is hampered by various barriers, including high levels of technical, policy and market uncertainty. The real options theory (ROT) provides a method to account for these uncertainties and introduce flexibility in the investment decision by allowing decisions to be changed in response to the evolution of uncertainties. ROT is already being applied frequently in the evaluation of renewable energy or carbon capture and storage (CCS) projects, e.g., addressing the uncertainty in the price of CO2. However, ROT has only found a few applications in the CCU literature to date. Therefore, this paper investigates the specific types of uncertainty that arise with the utilization of CO2, identifies the types of real options present in CCU projects and discusses the applied valuation techniques. Research gaps are identified in the CCU literature and recommendations are made to fill these gaps. The investment decision sequence for CCU projects is shown, together with the uncertainties and flexibility options in the CCU projects. This review can support the real options-based evaluations of the investment decisions in CCU projects to allow for flexibility and uncertainty.

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Valuation and investment strategies of carbon capture and storage technology under uncertainties in technology, policy and market

Cited by 8 publications

References 31 publications

Recent advances in carbon capture storage and utilisation technologies: a review

Recent advances in carbon capture storage and utilisation technologies: a review

Value Analysis Based on Investment in the New Energy Industry

Using Real Options Thinking to Value Investment Flexibility in Carbon Capture and Utilization Projects: A Review

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