Economics of CCS in Refining - Singapore case study
The refining industry faces significant challenges with declining margins, putting many refiners at risk of closure by 2030. The potential impact of carbon tax and policies may further drive the need for decarbonisation, increasing costs and reducing competitiveness. Singapore stands out as the only Asian nation imposing a carbon tax on refineries. CCS has emerged as a potential game-changer for hard-to-abate sectors, garnering interest in the industry. To support CCS adoption, the Singapore government has proactively taken measures, aiming to install a 2Mt capture capacity by 2030. However, widescale implementation encounters technical complexities, regulatory intricacies, and commercial viability concerns. Our analysis reveals implementation costs for CCS projects ranges from US$115 to US$185 per tCO2, making project economics challenging even with financial relief from the government. With economic viability at stake, refiners are challenged to seek cost-effective solutions.