The consulting firm Industrial Economics (IEc) has authored an interesting study that seeks to quantify the risks associated with CCS. Using a Monte Carlo random sampling method, IEc conducts a risk valuation for a hypothetical CCS installation located at Jewett, TX (one of the finalist sites under the original DOE FutureGen clean coal project). The key finding from the study is that, "Overall, estimated total damages are approximately $8.5 million (50th percentile) and $18.6 million (95th percentile)" (p. ES-19) over 100 years (in 2010 dollars). In other words, the "most likely" estimated damages over the lifetime of the project would be $8.5 million--there is a 50% chance that damages would be above or below this figure. "Upper end" damage estimates increase to $18.6 million--there is a 95% chance that damages would be equal to or below this figure. Given plans for 50 million metric tons of CO2 sequestered at Jewett, these damage estimates equate to just 17 cents per metric ton (most likely) and 37 cents per metric ton (worst case). Most damages would result from leaks at the sequestration site.
These sums are far less than damage estimates commonly put forward by opponents of CCS, and suggest that CCS risk mitigation and liability management are wholly tractable problems. However, as IEc is quick to point out, these results are also highly dependent on site-specific factors particular to Jewett and will not be precisely replicable elsewhere. Every actual and potential CCS site embodies a unique combination of geologic, economic, land-use, environmental, and other factors that render generic CCS risk valuations meaningless. Nevertheless, this study demonstrates that a generic risk valuation model, applied to plausible real-world sites, can serve as a useful method for quantifying CCS risks and can produce very encouraging results.