Toward Improved Cost Guidelines for Advanced Low-carbon Technologies

12 Pages Posted: 5 Apr 2021

See all articles by E.S. Rubin

E.S. Rubin

Carnegie Mellon University - Department of Engineering and Public Policy

Niels Berghout

International Energy Agency

George Booras

Electric Power Research Institute

Timothy Fout

National Energy Technology Laboratory

Monica Garcia

Electric Power Research Institute

Shareq Mohd Nazir

KTH Royal Institute of Technology

Andrea Ramirez

TuDelft

Simon Roussanaly

SINTEF Energy Research

Mijndert Van der Spek

Heriot Watt University

Date Written: April 3, 2021

Abstract

This paper presents a framework for estimating the future Nth-of-a-kind (NOAK) cost of advanced low-carbon technologies that are currently at early pre-commercial stages of development. It identifies two types of question that commonly motivate a cost analysis: “What If” questions about the hypothetical future cost of a technology that meets specified R&D goals or requirements; and “What Will” questions regarding the true expected cost of an advanced technology once it is mature and widely deployed. The latter type of question is the focus of this paper. It addresses shortcomings in the “bottom up” engineering-economic method current used to estimate NOAK costs. It describes a more rigorous hybrid costing method that combines a bottom-up analysis of the first-of-a-kind (FOAK) commercial cost of an advanced technology with an empirical model employing experience curves to project its future cost. Guidelines are presented for all phases of the analysis.

Keywords: Technology cost estimates, cost guidelines, advanced energy technologies, techno-economic assessments, first-of-a-kind (FOAK) plants, experience curves, Nth-of-a-kind (NOAK) plants, contingency cost factors, system contingency cost

Suggested Citation

Rubin, E.S. and Berghout, Niels and Booras, George and Fout, Timothy and Garcia, Monica and Nazir, Shareq Mohd and Ramirez Ramirez, Andrea and Roussanaly, Simon and Van der Spek, Mijndert, Toward Improved Cost Guidelines for Advanced Low-carbon Technologies (April 3, 2021). Proceedings of the 15th Greenhouse Gas Control Technologies Conference 15-18 March 2021, Available at SSRN: https://ssrn.com/abstract=3818896 or http://dx.doi.org/10.2139/ssrn.3818896

E.S. Rubin (Contact Author)

Carnegie Mellon University - Department of Engineering and Public Policy ( email )

Baker Hall 129
5000 Forbes Avenue
Pittsburgh, PA 15213
United States

Niels Berghout

International Energy Agency ( email )

Paris
France

George Booras

Electric Power Research Institute ( email )

3412 Hillview Avenue
P.O. Box 10412
Palo Alto, CA 94304-1395
United States

Timothy Fout

National Energy Technology Laboratory

3610 Collins Ferry Rd
Morgantown, WV 26507
United States

Monica Garcia

Electric Power Research Institute

3412 Hillview Avenue
P.O. Box 10412
Palo Alto, CA 94304-1395
United States

Shareq Mohd Nazir

KTH Royal Institute of Technology ( email )

Sweden
+46737166083 (Phone)

Andrea Ramirez Ramirez

TuDelft ( email )

Stevinweg 1
Stevinweg 1
Delft, 2628 CN
Netherlands

Simon Roussanaly

SINTEF Energy Research ( email )

Kolbjørn Hejes vei 1A
Trondheim, NO-7034
Norway

Mijndert Van der Spek

Heriot Watt University ( email )

Institute of Petroleum Engineering
Edinburgh, EH144AS
United Kingdom

HOME PAGE: http://www.rccs.hw.ac.uk

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