Deep decarbonisation pathways for Scottish industries: research report

8 Appendix

8.1 Bibliography for the literature review

Benner, J., van Lieshout, M., & Croezen, H. (2011). Identifying breakthrough technologies for the production of basic chemicals. https://www.scribd.com/document/342182520/CE-Delft-Identifying-Breakthrough-Technologies-for-the-Production-of-Basic-Chemicals.

British Glass. (2014). A Clear Future: UK glass manufacturing sector decarbonisation roadmap to 2050. https://www.britglass.org.uk/sites/default/files/A%20clear%20future%20-%20UK%20glass%20manufacturing%20sector%20decarbonisation%20roadmap%20to%202050_summary.pdf.

British Glass. (2017). Recycled content of glass packaging. https://www.britglass.org.uk/knowledge-base/resources-and-publications/recycled-content-glass-packaging.

Brownsort, P. (2018). Negative Emission Technology in Scotland: carbon capture and storage for biogenic CO₂ emissions. www.sccs.org.uk/images/expertise/reports/working-papers/WP_SCCS_2018_08_Negative_Emission_Technology_in_Scotland.pdf.

Committee on Climate Change. (2018). Biomass in a low-carbon economy. https://www.theccc.org.uk/publication/biomass-in-a-low-carbon-economy/.

Committee on Climate Change. (2019). Net Zero Technical Report. https://www.theccc.org.uk/publication/biomass-in-a-low-carbon-economy/.

Element Energy, Ecofys, & Imperial College London. (2014). The potential for recovering and using surplus heat from industry. https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/294900/element_energy_et_al_potential_for_recovering_and_using_surplus_heat_from_industry.pdf.

Element Energy, & Jacobs. (2018). Industrial Fuel Switching Market Engagement Study. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/824592/industrial-fuel-switching.pdf.

Element Energy, Advisian, & Cardiff University. (2019). Hy4Heat WP6: Conversion of Industrial Heating Equipment to Hydrogen. https://www.hy4heat.info/reports.

Energy Transitions Commission. (2018). Mission Possible: Reaching net-zero carbon emissions from harder-to-abate sectors by mid-century. http://www.energy-transitions.org/mission-possible.

Griffin, P. W., Hammond, G. P., & Norman, J. B. (2018). Industrial energy use and carbon emissions reduction in the chemicals sector: A UK perspective. Applied Energy, 227, 587–602. https://www.sciencedirect.com/science/article/pii/S0306261917310255?via%3Dihub.

ICF Consulting Services Limited, & Fraunhofer ISI. (2019). Industrial Innovation: Pathways to deep decarbonisation of Industry. Part 1: Technology Analysis. https://ec.europa.eu/clima/sites/clima/files/strategies/2050/docs/industrial_innovation_part_1_en.pdf.

IEA, ICCA, & DECHEMA. (2013). Technology Roadmap Energy and GHG Reductions in the Chemical Industry via Catalytic Processes. https://webstore.iea.org/technology-roadmap-energy-and-ghg-reductions-in-the-chemical-industry-via-catalytic-processes.

Lenaghan, M., & Mill, D. (2015). Industrial Decarbonisation and Energy Efficiency Roadmaps: Scottish Assessment. https://www.theccc.org.uk/2015/03/27/industrial-decarbonisation-and-energy-efficiency-roadmaps-to-2050/.

Mineral Products Association. (2013). The UK cement industry 2050 roadmap. www.sccs.org.uk/images/expertise/reports/working-papers/WP_SCCS_2018_08_Negative_Emission_Technology_in_Scotland.pdf.

WSP Parson Brinkerhoff, & DNV GL. (2015). Industrial Decarbonisation and Energy Efficiency Roadmaps to 2050. (Note: roadmaps for different sectors)https://www.gov.uk/government/publications/industrial-decarbonisation-and-energy-efficiency-roadmaps-to-2050.

8.2 Other references

ACT Acorn Consortium. (2019). ACT Acorn Feasibility Study: D20 Final Report. actacorn.eu/sites/default/fi les/ACT%20Acorn%20Final%20Report.pdf

Antonini, C., Treyer, K., Streb, A., van der Spek, M., Bauer, C., & Mazzotti, M. (2020). Sustainable Energy & Fuels Hydrogen production from natural gas and biomethane with carbon capture and storage – A techno-environmental analysis. Sustainable Energy Fuels, 4, 2967–2986. https://doi.org/10.1039/d0se00222d.

BEIS. (2018). Updated energy and emissions projections. https://www.gov.uk/government/publications/updated-energy-and-emissions-projections-2018.

BEIS. (2020). Renewable electricity in Scotland, Wales, Northern Ireland and the regions of England, Energy Trends. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/875409/ET_6.1.xls.

Bloomberg NEF. (2020). Hydrogen Economy Outlook. https://about.bnef.com/blog/hydrogen-economy-offers-promising-path-to-decarbonization/.

Bossel, U., Eliasson, B. (2003) Energy and The Hydrogen Economy. http://www.methanol.org/pdf/HydrogenEconomyReport2003.pdf.

Committee on Climate Change. (2017). Energy Prices and Bills. https://www.theccc.org.uk/publication/energy-prices-and-bills-report-2017/.

Committee on Climate Change. (2018). Reducing UK emissions: 2018 Progress Report to Parliament. https://www.theccc.org.uk/wp-content/uploads/2018/06/CCC-2018-Progress-Report-to-Parliament.pdf

Committee on Climate Change. (2019). Reducing emissions in Scotland 2019 Progress Report to Parliament. https://www.theccc.org.uk/wp-content/uploads/2019/12/Reducing-emissions-in-Scotland-2019-Progress-Report-to-Parliament-CCC.pdf

E4Tech. (2019). H2 emissions potential: literature review. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/798243/H2_Emission_Potential_Report_BEIS_E4tech.pdf.

Element Energy, Carbon Counts, PSE, Imperial College, & University of Sheffield. (2014). Demonstrating CO₂ capture in the UK cement, chemicals, iron and steel and oil refining sectors by 2025: a techno-economic study. http://www.element-energy.co.uk/wordpress/wp-content/uploads/2017/06/Element_Energy_DECC_BIS_Industrial_CCS_and_CCU_final_report_14052014.pdf.

Element Energy. (2017a). Deployment of an industrial Carbon Capture and Storage cluster in Europe: A funding pathway. https://www.i2-4c.eu/wp-content/uploads/2017/10/i24c-report-Deployment-of-an-industrial-CCS-cluster-in-Europe-2017-Final-.pdf

Element Energy. (2017b). Enabling the deployment of industrial CCS. https://ieaghg.org/publications/technical-reports/reports-list/9-technical-reports/960-2018-01-enabling-the-deployment-of-industrial-ccs-clusters.

Element Energy. (2018). Industrial carbon capture business models. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/759286/BEIS_CCS_business_models.pdf.

Element Energy. (2019a). Assessment of Options to Reduce Emissions from Fossil Fuel Production and Fugitive Emissions. https://www.theccc.org.uk/publication/assessment-of-options-to-reduce-emissions-from-fossil-fuel-production-and-fugitive-emissions/.

Element Energy. (2019b). Hy-Impact Series Hydrogen in the UK, from technical to economic. A summary of four studies assessing the role of hydrogen in the UK net-zero transition. http://www.element-energy.co.uk/wordpress/wp-content/uploads/2019/11/Element-Energy-Hy-Impact-Series-Summary-Document.pdf.

Element Energy. (2019c). Extension to Fuel Switching Engagement Study (FSES) – Assumptions log. https://www.theccc.org.uk/publication/extension-to-fuel-switching-engagement-study-deep-decarbonisation-of-uk-industries-assumptions-log/.

Element Energy. (2020). Gigastack: Bulk Supply of Renewable Hydrogen. www.element-energy.co.uk/wordpress/wp-content/uploads/2020/02/Gigastack-Phase-1-Public-Summary.pdf.

Grubb, M. (2014). Planetary Economics: Energy, climate change and the three domains of sustainable development.

Health and Safety Laboratory. (2015). Injecting hydrogen into the gas network – a literature search. https://www.hse.gov.uk/research/rrpdf/rr1047.pdf.

HM Government, & Scottish Government. (2020). The future of UK carbon pricing UK government and devolved administrations' response. https://www.gov.uk/government/consultations/the-future-of-uk-carbon-pricing.

Hydrogen Council. (2020). Path to hydrogen competitiveness: a cost perspective. https://hydrogencouncil.com/en/path-to-hydrogen-competitiveness-a-cost-perspective/.

IEAGHG. (2019). Towards zero emissions CCS in power plants using higher capture rates or biomass. (March), 1–128. http://documents.ieaghg.org/index.php/s/CLIZIvBI6OdMFnf/download.

Lenaghan, M., & Mill, D. (2015). Industrial Decarbonisation and Energy Efficiency Roadmaps: Scottish Assessment. https://www.resourceefficientscotland.com/sites/default/files/downloadable-files/Industrial%20Decarbonisation%20and%20Energy%20Efficiency%20Roadmaps%20Scottish%20Assessment.pdf.

Mohd S., Hendrik, J., Cloete, S., & Amini, S. (2019). Efficient hydrogen production with CO₂ capture using gas switching reforming. Energy, 185, 372–385. https://doi.org/10.1016/j.energy.2019.07.072.

Navigant for the Energy Networks Association. (2020). Pathways to Net-Zero: Decarbonising the Gas Networks in Great Britain. https://www.energynetworks.org/assets/files/gas/Navigant%20Pathways%20to%20Net-Zero.pdf.

NAEI (2019) Greenhouse Gas Inventories for England, Scotland, Wales & Northern Ireland: 1990-2017. https://naei.beis.gov.uk/reports/reports?report_id=1000.

Owen, A., Ivanova, D., Barrett, J., Cornelius, S., Francis, A., Matheson, S., Redmond- King, G., & Young, L. (2020). Carbon Footprint: Exploring the UK’s Contribution to Climate Change. https://www.wwf.org.uk/sites/default/files/2020-04/FINAL-WWF-UK_Carbon_Footprint_Analysis_Report_March_2020%20%28003%29.pdf

Parsons Brinckerhoff. (2011). Electricity Generation Cost Model - 2011 Update - Revision 1. https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/48126/2153-electricity-generation-cost-model-2011.pdf.

Pale Blue Dot. (2018). CO₂ Transportation and Storage Business Models. https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/677721/10251BEIS_CO₂_TS_Business_Models_FINAL.pdf.

Pale Blue Dot and Axis Well Technology. (2016). Progressing Development of the UK's Strategic Carbon Dioxide Storage Resource A Summary of Results from the Strategic UK CO₂ Storage Appraisal Project. https://www.eti.co.uk/programmes/carbon-capture-storage/strategic-uk-ccs-storage-appraisal.

Ricardo. (2018). Whisky by-products in renewable energy. https://www.climatexchange.org.uk/media/3024/revised-february-2018-whisky-by-products-life-cycle-analysis-report-v02-03.pdf.

Ricardo. (2019). Zero Emission HGV Infrastructure Requirements. https://www.theccc.org.uk/publication/zero-emission-hgv-infrastructure-requirements/.

Ricardo. (2020). Scotch whisky pathway to net zero. https://www.scotch-whisky.org.uk/media/1733/net-zero-pathways-report-june-2020.pdf

Rosenbloom, D., Markard, J., Geels, F. W., & Fuenfschilling, L. (2020). Why carbon pricing is not sufficient to mitigate climate change—and how "sustainability transition policy" can help. Proceedings of the National Academy of Sciences of the United States of America, 117(16), 8664–8668. https://doi.org/10.1073/pnas.2004093117.

Scotch Whisky Association. (2012). Scotch Whisky Industry Environmental Strategy Report 2012. http://www.laphroaig.it/files/2012_swa_environmentalstrategy.pdf.

SLR. (2020). Decarbonisation of heat across the food and drink manufacturing sector. https://www.fdf.org.uk/publicgeneral/fdf-slr-report-decarbonising-heat-to-net-zero.pdf.

Speirs, J., Balcombe, P., Johnson, E., Martin, J., Brandon, N., & Hawkes, A. (2017). A Greener Gas Grid: What Are the Options? https://www.sustainablegasinstitute.org/wp-content/uploads/2017/12/SGI-A-greener-gas-grid-what-are-the-options-WP3.pdf

The Scottish Government. (2019). The Scottish Greenhouse Gas Emissions Annual Target Report for 2017. https://www.gov.scot/publications/scottish-greenhouse-gas-emissions-annual-target-report-2017/.

University of Edinburgh. (2009). Opportunities for CO₂ Storage around Scotland; An Integrated Strategic Research Study. https://era.ed.ac.uk/handle/1842/15718.

van Cappellen, L., Croezen, H., & Rooijers, F. (2018). Feasibility study into blue hydrogen. https://greet.es.anl.gov/publication-smr_h2_2019.

8.3 Emissions in and out of scope

Table 19 provides a breakdown of all GHG emissions in Scotland in 2018. Out of a total 41.6 MtCO₂e, 28% (11.5 MtCO₂e) is mapped to the 'Industry' sector (according to mapping for the Climate Change Plan, or CCP).

Table 19 – Breakdown of Scottish GHG emissions in 2018 ^[182]

CCP Mapping	Source Sector	CO2 (MtCO2e)	Other GHG (MtCO2e)	Total (MtCO2e)[183]
Industry	Business and Industrial Process	6.45	0.42	6.87
	Energy supply	4.21	0.44	4.65
Total Industry		10.66	0.86	11.53
Agriculture	Agriculture and Related Land Use	1.03	6.44	7.47
Electricity Generation	Energy Supply	2.13	0.02	2.15
Land use	Agriculture and Related Land Use	1.79	0.32	2.11
	Development	1.90	0.15	2.05
	Forestry	-9.67	0.08	-9.59
Residential	Residential	6.01	0.22	6.23
Services	Business and Industrial Process	1.30	0.78	2.08
	Public Sector Buildings	1.10	0.00	1.10
Transport	International Aviation and Shipping	1.88	0.02	1.90
	Transport (exc. above)	12.76	0.14	12.91
Waste	Waste Management	0.01	1.67	1.68
Total Other		20.23	9.85	30.09
Total Scotland		30.90	10.72	41.61

Emissions from members of the Scottish Whisky Association

A recent report by Ricardo commissioned by the SWA and covering 127 sites (including 70 malt distilleries, 5 grain distilleries and 11 packaging sites) determined that emissions from these sites amounted to 529 ktCO₂e in 2018. Of these, 5% relate to electricity use (scope 2, and hence not in scope), and 198 ktCO₂e are from 11 large distilleries already accounted for within the NAEI data. Hence, it was estimated that emissions from the other 116 sites were 305 ktCO₂e.

Emissions from smaller sites

A previous report by Zero Waste Scotland indicated that, in 2012, the food and drink subsector included "over 800 companies, only 4% of which […] defined as 'large enterprises'", which collectively generated nearly 1.7 MtCO₂e.^[184] By comparison, the large food and drink sites included in the NAEI data only reported emissions of 0.3 MtCO2e in 2018, and even including SWA member sites the reported sector total barely exceeded 0.6 MtCO₂e in 2018. For this reason, it is believed that a large share of the estimated 1.6 MtCO₂e from smaller sites originates within this sector. Further information around possible decarbonisation pathways for the food and drink sectors can be found in a recent report by SLR for the Food and Drink Federation (FDF).^[185]

Emissions of greenhouse gas other than CO₂

As indicated in Section 2.2, carbon dioxide (CO₂) is by far the most commonly emitted greenhouse gas (GHG) across all Scottish industries, contributing to 92% of all global warming potential.^[186] There are however a few sources within industries out of scope which emit non-negligible amounts of other GHGs: ^[187]

• Industrial refrigeration systems, which emit 0.14 MtCO₂e of hydrofluorocarbon (HFC) gases.
• Electronics and shoes manufacturing, which emit 0.14 MtCO₂e of perfluorinated chemicals (PFCs).
• Foam blowing and fire protection equipment, which also emit a smaller amount of HFCs (0.05 MtCO2e).
• Electrical insulation equipment, from which 0.02 MtCO₂e of sulfur hexafluoride (SF₆) are emitted yearly.
• Other sources, which combined emit a total of 0.09 MtCO₂e.

More substantial emissions of other GHGs occur in the upstream oil and gas operations, where 0.4 MtCO₂e of methane (CH₄) was emitted in 2018 (see Figure 1).

Table 20 – GHG emissions other than CO2

All values in MtCO2e	HFCs	PFCs	SF6	CH4	N2O	NF3	Total
Industrial Refrigeration	0.14	-	-	-	-	-	0.14
Electronics and shoes	-	0.13	0.01	-	-	-	0.14
Firefighting	0.03	-	-	-	-	-	0.03
Foams	0.02	-	-	-	-	-	0.02
Electrical insulation	-	-	0.02	-	-	-	0.02
Other sources	0.03	0.02	0.01	0.01	0.02	0.00	0.09
Total	0.22	0.14	0.04	0.01	0.02	0.00	0.43

Other exclusions

Figure 18 provides a breakdown of the 0.1 MtCO₂e classified as 'other exclusions in Figure 1.

8.4 Sector-specific and cross-sectoral processes

Table 21 – Sector-specific and cross-sectoral processes ^[188]

Emissions source	Sector-specific process	Cross-sectoral processes	Applicable sector or subsector
Boiler or CHP	Drying, separation, space heating, other steam-based processes	Indirect – Steam-driven (from boiler or CHP)	All
CHP	Processes driven by electricity	Electricity-driven (from CHP)
Dryer	Drying	Direct - Low Temperature Direct - High Temperature	Paper, food & drink, other EIIs
Fluid catalytic cracker	Fluid catalytic cracking	Direct - High Temperature	Oil and gas refining
Cement kiln	Cement kiln	Direct - High Temperature	Cement
Natural gas fired furnace	Casting, closed-die forging press, steel finishing, rolling	Direct - High Temperature	Metals
	Melting	Direct - High Temperature	Glass
	Other high-temperature process	Direct - High Temperature Indirect - High Temperature	Glass, refining, other EIIs
Natural gas oven	Baking and other direct fired processes	Direct - Low Temperature	Food & drink
Steam cracker	Steam cracking	Indirect - High Temperature	Olefins
Chemical reactions in industrial process	Calcination	Industrial Process	Cement
	Aluminium electrolysis		Aluminium
	Feedstock degradation		Glass
	Flaring		Olefins, oil and gas refining
	Steam-methane reactor		Oil and gas refining
Other	Other Direct Fire	Direct - Low Temperature	Food & drink
	Other	Other	Chemicals, food & drink, other EIIs

8.5 Emissions by cross-sectoral processes

The tables below report the numerical values of the emissions breakdown shown in Figure 6.

Table 22 – Emissions by cross-sectoral process and sector ( ktCO ₂e)

Cross-sectoral process	Chemicals	Oil & gas	Cement	Other EIIs	Paper	Food & drink	Glass	Metals
High Temperature	1,072	1,168	-	-	-	-	-	-
Steam from CHP	444	493	-	3	69	9	-	-
Steam from boiler	453	-	-	21	-	436	-	1
High Temperature	-	266	188	56	-	-	180	32
Low Temperature	-	-	-	22	4	69	-	-
Electricity from CHP	212	346	-	51	57	10	-	-
Unclassified fuel use	35	-	-	4	-	104	-	-
Process	37	383	385	-	-	-	50	64

Table 23 – Emissions by cross-sectoral process and fuel type ( ktCO ₂e)

Cross-sectoral process	Natural gas	Solid fuels	Oil	Internal fuel	Industrial processes
High Temperature	467	-	-	1,772	-
Steam from CHP	1,007	4	7	-	190
Steam from boiler	765	14	131	-	65
High Temperature	263	193	0	266	14
Low Temperature	73	2	20	-	269
Electricity from CHP	676	-	-	-	164
Unclassified fuel use	103	3	37	-	-
Process	-	-	-	-	819

8.6 Carbon cost assumptions

	Traded			Non-traded
	Low	Central	High	Low	Central	High
2010	14	14	14	30	60	90
2011	13	13	13	30	61	91
2012	7	7	7	31	61	92
2013	4	4	4	31	62	94
2014	5	5	5	32	63	95
2015	6	6	6	32	64	96
2016	5	5	5	33	65	98
2017	5	5	5	33	66	99
2018	2	13	26	34	67	101
2019	0	13	26	34	68	102
2020	0	14	28	35	69	104
2021	4	21	37	35	70	106
2022	8	27	46	36	72	107
2023	12	34	56	36	73	109
2024	16	41	65	37	74	111
2025	20	47	74	38	75	113
2026	24	54	84	38	76	114
2027	28	61	93	39	77	116
2028	32	67	103	39	79	118
2029	36	74	112	40	80	120
2030	40	81	121	40	81	121
2031	44	88	132	44	88	132
2032	48	96	144	48	96	144
2033	52	103	155	52	103	155
2034	55	111	166	55	111	166
2035	59	118	178	59	118	178
2036	63	126	189	63	126	189
2037	67	133	200	67	133	200
2038	70	141	211	70	141	211
2039	74	148	223	74	148	223
2040	78	156	234	78	156	234
2041	82	163	245	82	163	245
2042	85	171	256	85	171	256
2043	89	178	268	89	178	268
2044	93	186	279	93	186	279
2045	97	193	290	97	193	290
2046	100	201	301	100	201	301
2047	104	208	313	104	208	313
2048	108	216	324	108	216	324
2049	112	223	335	112	223	335
2050	115	231	346	115	231	346

Source: BEIS modelling (2019). Further guidance on the use of carbon values is available from the appraisal guidance (Chapter 3) which can be downloaded from the Green Book supplementary guidance section of GOV.UK webpage.

8.7 Modelling assumptions for carbon capture and compression

This section summarises all modelling assumptions for carbon capture and compressor.

Capture costs

The CAPEX for a plant of size X MtCO₂/y and with CO₂ flue gas concentration Y is given by the following set of formulas:

CAPEX for plant of size X = (CAPEX of reference plant) * (X / reference size) ^ (scaling exponent) *

* (Flue gas concentration of reference plant / Y) ^ (CO₂ exponent)

The OPEX is instead calculated as percentage of CAPEX. All the relevant data is provided in the tables below where values for advance amines and calcium looping capture technologies is provided for reference (source: Element Energy, 2019c).

Table 24 – Characteristics of emission sources where carbon capture is deployed

Subsector	Emission source	Type	CO2 stream purity (% volume)	Assumed capture rate
Cement	Calcination reaction	Process	95%	100%
Cement	Kiln	Combustion	10%	90%
Petrochemicals	Steam cracking	Combustion	10%	90%
Refining	Refinery furnaces	Combustion	10%	90%
Refining	SMR	Process	95%	100%

Table 25 – Cost assumptions for carbon capture

Capture technology	Reference CAPEX (£m)	Opex (% of CAPEX)	Reference size (MtCO2/y)	Scaling exponent	Reference CO2 stream purity (% volume)	CO2 exponent
First generation amines	505.6	8%	2	0.67	11.5%	0.53
Advanced amines	388.9	5%	2	0.67	11.5%	0.53
Calcium looping	155.4	19%	2	0.67	13.0%	0.53

Energy requirements for capture

The heat and electricity requirements are inversely proportional to the CO₂ concentration of the exhaust stream. The formula for the heat input required per tCO2 is given by

Heat input (kWh/tCO₂) = Reference heat input * Heat scaling coefficient *

* (CO₂ concentration (%) * 100) ^ Heat scaling exponent

The formula for the electricity input required is analogous (swap 'heat' with 'electricity' in the above). All the necessary data is provided in Table 26.

Note that the energy costs are additional to those calculated above for capture and below for compression.

Table 26 – Energy requirements for carbon capture

Capture technology	Reference heat input (kWh/t CO2)	Heat scaling coefficient	Heat scaling exponent	Reference electricity input (kWh/t CO2)	Electricity scaling coefficient	Electricity scaling exponent
First generation amines	1056	1.42	-0.142	56.0	11.2	-0.99
Advanced amines	833	1.42	-0.142	56.0	11.2	-0.99
Calcium looping	444	1.42	-0.142	150.0	11.2	-0.99

Compression costs

It is assumed that CO₂ is always captured at atmospheric pressure (0.11MPa) and must be compressed to 10MPa for pipeline transport. The compressor is sized according to the following formula:^[189]

Compressor size (MW) = CO₂ flowrate (m³/s) * 0.11 MPa * log(10MPa/0.11MPa) / Compressor efficiency (%)

Where the CO₂ flowrate in m3/s can be calculated from the annual abatement and the (pressure-dependent) density of CO₂. The CAPEX and OPEX of the compressor are calculated in an analogous manner to the corresponding capture costs

Table 27 – Modelling parameters for CO2 compression

Capex (£m/MW)	Opex (% of CAPEX)	Efficiency (%)	Reference size (MW)	Sizing exponent
1.64	5%	75%	10	0.29

8.8 Additional results for the Hydrogen pathway

The figures below complement the those for the Hydrogen pathway presented in Chapter 6.

8.9 Capital expenditure: annualised and financing cost

The capital expenditure, CAPEX, is annualised using MS Excel's PMT function:

Annualised CAPEX: -PMT(WACC, [Equipment lifetime], [Equipment CAPEX])

Where WACC is the Weighted Average Cost of Capital, assumed equal to 10% (representative of that for the private sector).

The annualised CAPEX is further split into two components:

Repayment of the principal loan: -PMT(0, [Equipment lifetime], [Equipment CAPEX])

Interest payments: Annualised CAPEX - Principal loan repayment

Avoided carbon costs (through a carbon price) are not included.

The overall (i.e. not levelised) cost of abatement can be calculated using the formula above but setting R = 1 (effectively no discounting).

8.10 Levelised cost of abatement methodology

The levelised cost of abatement (LCOA) represents the carbon price that would be needed to make a given carbon abatement measure economically viable – i.e. achieve a zero net-present value (NPV). The way the LCOA is calculated is similar to that used to calculate the levelised cost of energy,^[190] i.e.:

LCOA (£/tCO2) =	net present cost of measure	=	Σ [ (CAPEX + OPEX + fuel cost difference[191])n / (1 + R)n ]
	total discounted lifetime abatement		Σ [ (abated emissions)n / (1 + R)n ]

Where R is the discount rate of 3.5%, n is the period (e.g. n = 1 is 2018 and n = 28 is 2045), and the sums are over all periods from n = 1 to n = 53 (corresponding to 2070).^[192] In the calculation for the levelised cost of energy the denominator would be replaced by the discounted sum of the electrical energy produced in period n.