CCS ZEEF study & methodology review for the Ministry of Economic Affairs and Climate Policy

The Dutch Climate Agreement stipulates that subsidising Carbon Capture and Storage (CCS) should not come at the expense of developing alternative, clean energy technologies. Therefore, subsidisation of CCS projects is regulated through the Sustainable Energy Production and Climate Transition Incentives (SDE++). One way of doing this is through ‘sieve methodology’, which looks at whether there are demonstrably cost-effective alternatives to CCS. There are currently eight different categories for technologies using CCS in SDE++. If cost-effective alternatives are identified for any of these categories, the relevant SDE category will be excluded from a subsidy.

At the request of the Ministry of Economic Affairs and Climate (Ministerie van Economische Zaken en Klimaat), CE Delft re-examined the method of sifting or identifying possible cost-effective alternatives to CCS. We present our revised sieve methodology in the report ‘Revision of Sieve Methodology CCS for SDE++’. In essence, this methodology involves identifying alternative technologies for all industrial processes for which CCS is potentially relevant and then calculating their cost-effectiveness based on the ‘Onrendabele Top-model’ (OT-model) of the Netherlands Environmental Assessment Agency (PBL Netherlands Environmental Assessment Agency).

We then elaborated our sifting methodology with a view to the 2023 round of subsidies. This elaboration can be found in the report ‘Cost-effective alternatives to CCS’. We conclude that a cost-effective alternative to CCS currently exists only for the process of evaporating aqueous solutions, namely Mechanical Vapour Recompression (MVR). Given that the SDE categories using CCS are much broader than this particular process, it is not possible to exclude a particular SDE category from subsidisation based on this alternative. In addition to MVR, we identified a number of techniques that are not yet more cost-effective than CCS, but are potentially promising and worthy of further investigation. These are the high-temperature heat pump, the wood-chip boiler and the electric boiler.