A Real Option Evaluation Model Of CCS Retrofit Project

Currently,the total annual CO2 emission in China is the largest in the world.As a participant in the "United Nations Framework Convention on Climate Change",less carbon emissions space problem is likely to restrict China in the future.The rapid development of China's economy means a huge demand for energy,corresponding to the huge emissions of greenhouse gases(GHG).Alt-hough,as the largest investor in clean energy,China has made significant investments in renewable energy,due to China's huge energy demand base,it is difficult to achieve in meeting the rapidly growing demand for energy while quickly reducing carbon intensity of China's energy industry.In the foreseeable future,the thermal power industry is still an important source of China's energy supply.Carbon dioxide capture and storage(CCS)as a mature technology,after appropriate modifi-cation,it can be applied to power plants and other high-concentration carbon source,quickly and efficiently the objective of reducing carbon intensity.However,CCS technology retrofit projects with problems in huge investment,high uncertainties in cash flow.Government and business need for a more efficient and more accurate analysis tools.These tools make effective assessment and analysis of investment decisions CCS technology development and improvement and CCS tech-nology retrofit projects.Compared with the traditional NPV analysis,real options are more flexible,efficient and accurate.Analysis can be targeted at different policy and market environment,the company's investment decisions and CCS retrofit project changes in revenue characteristics.This can provide a reference for the investment decision-making and government policy.The learning curve is a better method to reflect technological progress in CCS costs.Firstly,this article introduce's the International Emission background and reduction pressure on China.Then it introduces the development and application of Real Options in the energy and power sector.Introduced the learning curve and real option in the CCS technological retrofit pro-jects,and integrated assessment studies of the CCS technological retrofit projects.Then describes the main framework of real options and the main analytical methods and the basic model,and introduced the carbon emissions market and current situation of China's energy structure and other important influencing factors.Finally,different models were simulated and applying different models from the perspective of micro and macro factors of the project.Purpose of the article is that the characteristics analysis of different real options model in the analysis of the project.And establish a real option model for simulation under different policy and market environment,the company's investment decision-making behavior.The established models in this thesis can provide a reference tool for the evalu-ation of the different policy analysis.