Research On The Impact Of Carbon Tax Policy On CCS Investment Decisions Based On Real Options

CO₂ capture and storage?CCS?is a key technology for reducing CO₂ emissions in coal-fired power plants.It provides a realistic choice for meeting energy and environmental challenges and achieving 2°C temperature rise control targets by 2050.According to the IEA forecast,the contribution of CCS technology will increase from 3%in 2020 to 10%in 2030,and may reach 19%in 2050,making it the single emission reduction technology with the largest share of emission reduction.However,due to the uncertainty of its technology and cost,the large-scale promotion of CCS technology cannot be separated from the government's policy support.Carbon taxes and carbon trading are the most commonly used market-based policy instruments and are widely implemented in some countries.China also started a carbon emissions trading pilot in 2011 and established a national carbon emission trading system by the end of 2017.Despite this,current carbon market price levels are not sufficient to stimulate CCS investment.Considering that the carbon tax and carbon trading two complementary policies can complement carbon emission reduction targets,this paper introduces the carbon tax policy into the investment decision-making framework of power plant investment CCS,and discusses the implementation of carbon tax at the same time.In the case of policy,its impact on CCS project investment decisions,and then provide policy recommendations for the government to formulate relevant carbon tax policies.In view of the uncertainty of the CCS project,investors have higher decision-making flexibility and insufficient investment evaluation methods in the investment process.Therefore,the real option method is used to evaluate the project value.This paper firstly explains the theoretical basis of real options,analyzes the status of CCS investment in coal-fired power plants in China,and builds a CCS project investment model framework based on single?delayed?real options and composite causal options,based on this discussion.The impact of the carbon tax policy on CCS investment decisions.The details are as follows:For the evaluation of CCS project value,this paper constructs a single-stage delayed real option tri-tree model,and considers the use of carbon trading and carbon tax incentives together,setting the carbon tax rate and carbon trading price as The policy variable gives the CCS project value function including the carbon tax rate,and determines the investment decision rules of the trigeminal model based on the detailed description of the functional economic meaning.The ultra-supercritical PC?Pulverized Coal?power plant and the IGCC?Integrated Gasification Combined Cycle?power plant are selected.These two power plants,which are the most promising CCS power plants in China,are assumed to be the lowest.The carbon tax rate calculates the critical carbon tax rate corresponding to the CCS project of the power plant investment under the real option rule,and conducts sensitivity analysis on the uncertainty factors affecting the optimal tax rate.Further,considering the multi-stage nature of CCS investment,it has established Based on the two-stage investment framework of causal composite real options,the relevant economic evaluation indicators are calculated,and the optimal tax rate of CCS-EOR?Enhanced oil recovery?investment is derived,which is compared with the optimal tax rate under the single real option condition.Finally,based on the research findings,policy recommendations related to the development of carbon tax were proposed.