The Economics of Geological CO2 Storage and Leakage

Bob van der Zwaan () and Reyer Gerlagh

No 2008.10, Working Papers from Fondazione Eni Enrico Mattei

Abstract: The economics of CO2 capture and storage in relation to the possibility of significant leakage of CO2 from geological reservoirs once this greenhouse gas has been stored artificially underground will be among the main determinants of whether CCS can significantly contribute to a deep cut in global CO2 emissions. This paper presents an analysis of the economic and climatic implications of the large-scale use of CCS for reaching a stringent climate change control target, when geological CO2 leakage is accounted for. The natural scientific uncertainties regarding the rates of possible leakage of CO2 from geological reservoirs are likely to remain large for a long time to come. We present a qualitative description, a concise analytical inspection, as well as a more detailed integrated assessment model, proffering insight into the economics of geological CO2 storage and leakage. Our model represents three main CO2 emission reduction options: energy savings, a carbon to non-carbon energy transition and the use of CCS. We find CCS to remain a valuable option even with CO2 leakage of a few %/yr, well above the maximum seepage rates that we think are likely from a geo-scientific point of view.

Keywords: Climate Change; Carbon Dioxide Emission Reduction; Technological Innovation; CO2 Capture and Storage (CCS); Geological Leakage (search for similar items in EconPapers)
JEL-codes: C61 D58 H21 O33 Q40 (search for similar items in EconPapers)
Date: 2008-02
New Economics Papers: this item is included in nep-ene and nep-env
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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Working Paper: The Economics of Geological CO2 Storage and Leakage (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:fem:femwpa:2008.10

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