A new review of the pricing of electricity produced from carbon capture-equipped power generation facilities has been pulished by Toby Lockwood of the International Centre for Sustainable Carbon. The review found that, while wind and solar are more cost competitive on the standard levelised cost of electricity (LCOE) basis, the picture becomes different using modified processes that take the value of stable generation into account in the contexts of high levels of renewables in a grid.
Typically, LCOE in Western Europe and the USA for coal firing with carbon capture and storage is $90–130/MWh, while for combined cycle gas turbines with CCS it is $70–100/MWh, 1.5-3 times higher than solar or wind. However, this does not take the grid into context. Using total system cost analysis, which aims “to express the total cost of delivering a reliable electricity grid across a range of representative weather and demand scenarios, including all investment and operational costs over the course of the transition to lower carbon intensities”, as Mr Lockwood puts it, is a more holistic approach. It considers “the cost increase which would be incurred if the grid were decarbonised without that technology being available”, which “more closely represents the overall cost of grid decarbonisation to be met by consumers or taxpayers”.
Using total system cost analysis for several regional and national grids, wind and solar are consistently cheaper at lower shares of renewables, but “low-carbon dispatchable generation becomes extremely valuable as higher levels are approached (>80–90% reduction in gCO2/kWh). Forms of CCS frequently offer the most economic option for this dispatchable generation, with the proportions of coal, gas, or biomass-fired plant depending on various local factors.” The findings are similar to previous studies on the theme of fossil fuelled, CCS-equipped power generation, such as that by The Brattle Group, and suggest that as well as planning for large roll-outs of renewable power generation, economies across the world should also be planning for low-carbon dispatchable power.