C.1.1. R&D cost requirement for Storage project in first development years

R&D needs will evolve and are assumed to reduce with time. This evolution is taken into account in the cost model to calculate expected development costs or remaining development costs of a storage project from 2010 to at least 2020.

Actually, R&D is most needed in storage site development phase on methodological and technical standpoints. A “R&D cost requirement” factor curve has been developed to allow the expected calculation of R&D costs of each project within the period 2010 to 2030 when CCS is expected to reach full commercial deployment.

Before 2020, this R&D will mainly be supported by state aid or subsidies. After 2030, it is expected that R&D will still be needed but on a project basis at an industrial level. As such, R&D costs associated to a project development are decreasing with time.

As all costs are based on 2011 values, “R&D cost requirement” evolution factor is supposed to be equal to 1 in 2011.

Figure 69: R&D needs evolution factor as compared to 2010 R&D needs

It is considered that R&D needs will remain strong until the first industrial demonstration projects come online in 201555. These needs will start to slowly decrease as projects number increases and will then decrease sharply during early commercial deployment after 2020. Indeed, the main hypothesis is that first commercial deployment will happen when state R&D goals for CO2 storage will be mostly achieved, and consequently R&D cost requirement will decrease.

55 In Europe, the NER 300 fund first call should finance 6 to 8 projects that have to start operating by end 2015. In the USA, CCS task force announced that up to 10 commercial demonstration projects should be financed by 2016.