The Economics of Geological CO2 Storage and Leakage

22 Pages Posted: 1 Apr 2008

See all articles by Bob van der Zwaan

Bob van der Zwaan

Columbia University - Lenfest Center for Sustainable Energy, Earth Institute

Reyer Gerlagh

Tilburg University - Tilburg University School of Economics and Management

Date Written: April 2008

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

JEL Classification: H21, D58, C61, O33, Q40

Suggested Citation

van der Zwaan, Bob and Gerlagh, Reyer, The Economics of Geological CO2 Storage and Leakage (April 2008). FEEM Working Paper No. 10.2008. Available at SSRN: https://ssrn.com/abstract=1105059 or http://dx.doi.org/10.2139/ssrn.1105059

Bob Van der Zwaan (Contact Author)

Columbia University - Lenfest Center for Sustainable Energy, Earth Institute ( email )

314 Low Library
535 West 116th Street, MC 4327
New York, NY 10027
United States

Reyer Gerlagh

Tilburg University - Tilburg University School of Economics and Management ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
208
Abstract Views
1,299
rank
152,184
PlumX Metrics