What is required to make the ROAD project work? Dr. Peter Radgen, Head of Innovation Center CCS, E.ON, Düsseldorf, Germany ROAD CCS Demonstration Project y ROAD stands for „Rotterdam Opslag en Afvang Demonstratieproject“ y The owner of the project is the Maasvlakte CCS Project C.V. a 50/50 joint venture of E.ON Benelux and GDF Suez Energie Nederland y Intended partners for Transport and Storage are GDF SUEZ E&P and TAQA Energy y Financial support is provided by the European Commission (EU) under the EEPR Program and the Dutch Government 2 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen The E.ON Power Plant Site Maasvlakte in 2007 If you want to demonstrate CCS, it pays of to attach it to a new power plant MPP 1+2 MPP= Maasvlakte Power Plant 3 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen The E.ON Power Plant Site Maasvlakte in 2009 4 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen The E.ON Power Plant Site Maasvlakte in 2014 5 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen What the market was expecting in 2007 y Increasing electricity demand based on economic growth in Europe y A stable but rather constant growth of renewable energies 6 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen What the market was expecting in 2007 y CO2 certificate prices to increase further. y A single European Energy Market with a fair competition of low carbon technologies. y 10-12 CCS Demonstration Project and 10 B€ public funding available. 7 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen Development of Prospects for NER-300 funding Sale of 1st Tranche (200 Million Certificates by EIB took place from 12/2011 to 09/2012. Average price achieved was 8.05 € 8 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen STOXX® Europe 600 Utilities 9 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen Expected Number of CCS Demonstration Projects in Europe 10 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen The ROAD project setting N.O.P.: 72-128 barg. N.O.T.: 40 -80 deg C Maasvlakte Power Plant 3 N.O.P.: 67-125 barg. N.O.T.: around 50 deg C Compression and Cooling Dehydration, Metering Metering CO2 Capture Installation Onshore Transport Pipeline 5 km Offshore Transport Subsea Pipeline 20 km Start of MCP scope N.O.P.: Normal Operating Pressure N.O.T.: Normal Operating Temperature This flow diagram is not on scale , numbers are indicative 11 P18 –A Platform What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen 3,5 km CO2 Storage into depleted gas reservoirs N.O.P.: 20-300+ barg. N.O.T.: 28 -103 deg C Planning of the Flue Gas Tie-Inns 12 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen Flue gas and Steam Tie-Inns at MPP3 installed 13 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen Why Final Investment Decision (FID) for ROAD is pending since end of 2012 14 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen Why Final Investment Decision (FID) for ROAD is pending since end of 2012 Window of Opportunity is closing as EU might have to terminate EEPR contract if no FID can be taken in 2014 15 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen The Financial Gap – It is real ! Can it be closed ? The project over it‘s lifetime will not make any profit but a significant loss. CCS has currently a climate change but not a business driver. Currently CCS Demonstration does not look to be a business opportunity 16 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen Development of Project Costs CAPEX y Prices for major pieces of equipment and personal costs are typically increasing based on normal inflation as long as prices can not be fixed in an EPC contract. However financial support is not indexed. y Increased environmental performance based on lessons learnt from pilot installations require sometimes additional efforts OPEX y Key driver for an increasing operational deficit is the decreasing CO2 certificate price y Normal price escalation for all operation costs such as salaries and consumables needs to be taken into account 17 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen Conclusion y The Outlook for CCS on the short and mid term does not look promising y Increasing financial gaps in project financing can only be closed by a concerted short term action of the EU and/or the willing Member States y Uncertainty over future development of energy policy threatens all energy related investments y Most of the EEPR projects and the NER-300 first phase CCS Demonstration projects failed to reach FID y The ROAD project has still a chance to go ahead, but the window of opportunity is closing 18 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen It is not enough to know, it has to be applied; it is not enough to intend, it has to be done. Johann Wolfgang von Goethe (in: Wilhelm Meisters Wanderjahre) 19 What is required to make the ROAD project work? Platts Carbon Capture and Storage Conference Brussels, 18-19 February 2014 Peter Radgen www.road2020.nl
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