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Costs for CCS and DAC technologies
#1
Hi, 

We are including DAC and CCS technologies in our model, but have difficulties with understanding how to input the cost in TIMES. 
The data source provide costs in M€/(tCO2/hour). We have tested including the cost both in capacity units (Cap2ACT = 8.76) and acitivity units (CAP2ACT = 1). For the latter, we convert the cost by using M€/(tCO2/hour) * 8760 * AFA. The two approaches give significant differences in results. 

Attached is a screenshot of the input for CCS in the latter case. What is the correct approach to use in this case? 


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#2
> We are including DAC and CCS technologies in our model, but have difficulties with understanding how to input the cost in TIMES.

Yes, I understand that unit conversions may sometimes be confusing, but otherwise I think the TIMES investment cost concept NCAP_COST is pretty clear and transparent: It represents the total investment costs (as opposed to e.g. annualized cost or a CAPEX component of levelized costs) per unit of capacity. Usually the only thing to check would be whether interest during construction (IDC) is included in the data or not, because IDC should be either included or excluded in NCAP_COST, depending on whether one wants to use NCAP_ILED or not.

> The data source provide costs in M€/(tCO2/hour).

Ok, so if the cost is given as CINV (M€/(tCO2/hour)), and the desired capacity unit is kta (kilotonnes per year) I think that can be directly translated into CINV/8.76 (M€/kta), because 1 t/hour = 8.76 kt/a.

> We have tested including the cost both in capacity units (Cap2ACT = 8.76) and acitivity units (CAP2ACT = 1). For the latter, we convert the cost by using M€/(tCO2/hour) * 8760 * AFA.

Ok, so in the first case you simply use the original CINV value, but define the conversion from the capacity unit to activity unit as 8.76.  This means that your activity using should be in kt, and your currency unit should be M€.  If so, I think that would be quite correct, because the Cap2ACT = 8.76 would make it equivalent with the division by 8.76 I wrote above.

But in the second case, do you multiply CINV by 8760 and AFA?  Or divide it by 8760 and AFA?  I don't see how either could be correct.  And using AFA would be justified only if the cost represents a unit production cost component (e.g. CAPEX component of levelized costs), but I don't think this is the case here.

> Attached is a screenshot of the input for CCS in the latter case.

Ok, here you also use kNOK. It would help if you would show the original data for this case as well....
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#3
Dear Antti,

Thank you for the reply.

My mistake - we divide by 8.76 as you explain in your calculation with CINV/8.76 (M€/kta).
And I agree that AFA should not be included in the cost component as it doesn't represent unit production cost.

I believe we manage the unit conversion correct now. Thank you!
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