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Estimate Commercial Value of CO2 Storage

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Aniket Kumar's picture
Product Manager, Yokogawa Electric Corporation

Aniket is currently leading product management role and developing the next version of disruptive products for sustainability of multiple sectors and building success stories & new business...

  • Member since 2023
  • 38 items added with 6,300 views
  • Feb 1, 2023

Carbon storage refers to the process of sequestering or storing carbon in various forms in the natural environment, including in plants, soil, oceans, and geologic formations. This can include processes such as photosynthesis, in which plants absorb carbon dioxide from the atmosphere and store it in their biomass, and the carbon cycle, in which carbon is exchanged between different parts of the Earth's systems. Human activities, such as deforestation and burning fossil fuels, can disrupt natural carbon storage processes and contribute to the buildup of carbon dioxide in the atmosphere, leading to climate change.

There is no one specific formula for calculating the cost of carbon storage as the cost can vary depending on the method used for carbon sequestration and the specific project or location. 

However, some general factors that can be used to estimate the cost of carbon storage include:

  • Capital costs: These include the costs of establishing and implementing the carbon sequestration project, such as the cost of planting trees, building infrastructure, or purchasing equipment.
  • Operational costs: These include the costs of maintaining and managing the carbon sequestration project, such as the cost of watering, fertilizing, and protecting trees, or the cost of monitoring and measuring carbon sequestration.
  • Carbon price: The price of carbon can vary depending on the carbon offset market or PES program, and can affect the cost of carbon storage.
  • Duration of the project: The duration of the project also affects the cost of carbon storage, as longer-term projects will have higher costs than shorter-term projects.

A rough formula to estimate the cost of carbon storage could be:

Cost of carbon storage = (Capital cost + Operational cost) * (Duration of the project) / Carbon sequestration

Keep in mind that the cost of carbon storage can also be affected by a variety of other factors, such as land availability, land use, local regulations, and the specific carbon sequestration method used.

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