final version CO2NET lectures 24-4-2006-4 Economics of CCS.pptVIP

CO2NET Lectures on Carbon Capture and Storage Outline lecture 4: Economics of CCS Basics of business economics How to estimate costs Cost of CCS Benefits of CO2 storage Case of capital cost calculation Suppose we buy machine of 100 € This machine can produce 40 € worth of products each year. We also have to pay 10 € per year for raw materials. Expected life time = 5 years. How much do we earn? Case (2) Net Present Value (NPV) (1) Net Present Value (NPV) (2) Net Present Value (NPV) (3) Capital Recovery factor Cost of capturing Cost estimations Converting historical data to current costs