Product Summary

CCUS Business Models in the PCOR Partnership Region

Comprising ten states and four Canadian provinces, the Plains CO₂ Reduction (PCOR) Partnership Initiative region is home to abundant and diverse sources of anthropogenic CO₂ (e.g., coal- and gas-fired power plants, gas-processing plants, ethanol plants), fitting geology for CO₂ storage and utilization, a history of CO₂ transport and expanding pipeline infrastructure, and an established industrial/energy commercial base. Whether from a capture-ready, nearly pure CO₂ source associated with an ethanol plant or from the retrofit of a 1000-MW coal-fired power plant, implementing carbon capture, utilization, and storage (CCUS) is an expensive endeavor. Recent reports have detailed several business model frameworks that address the varied contractual relationships between CO₂ source, capture, transport, and storage components of the CCUS chain. These models range from full vertical integration where one entity manages all aspects of the CCUS chain to a CCUS transporter model with separate management and oversight on each individual component of the chain. The existing and developing projects in the PCOR Partnership region fit within one or more of these described business models. For an industry to move forward with a CCUS project, a business model catalyzed with one or more viable drivers (e.g., CO₂ enhanced oil recovery [EOR], tax credits) must be adopted that does not negatively impact a company's bottom line. A diverse and robust commercial CCUS industry has evolved in the PCOR Partnership region over the past 30 years. Pathways, business models, and drivers that have facilitated existing and emerging CCUS development in the PCOR Partnership region have recently shifted from resource recovery (CO₂ EOR and associated CO₂ storage) to green growth dominated by dedicated storage. This fundamental shift can be shown based on the list of newly announced CCUS projects in the PCOR Partnership region. Although these projects include CO₂ EOR, most are being driven by tax credit or product value enhancement.