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A Novel Scheme to Allocate the Green Energy Transportation Costs—Application to Carbon Captured and Hydrogen


Carbon dioxide (CO2 ) and hydrogen (H2 ) are essential energy vectors in the green energy transition. H2 is a fuel produced by electrolysis and is applied in heavy transportation where electrification is not feasible yet. The pollutant substance CO2 is starting to be captured and stored in different European locations. In Denmark, the energy vision aims to use this CO2 to be reacted with H2 , producing green methanol. Typically, the production units are not co-located with consumers and thus, the required transportation infrastructure is essential for meeting supply and demand. This work presents a novel scheme to allocate the transportation costs of CO2 and H2 in pipeline networks, which can be applied to any network topology and with any allocation method. During the tariff formation process, coordinated adjustments are made by the novel scheme on the original tariffs produced by the allocation method employed, considering the location of each customer connected to pipeline network. Locational tariffs are provided as result, and the total revenue recovery is guaranteed to the network owner. Considering active customers, the novel scheme will lead to a decrease of distant pipeline flows, thereby contributing to the prevention of bottlenecks in the transportation network. Thus, structural reinforcements can be avoided, reducing the total transportation cost paid by all customers in the long-term.

Funding source: This work was carried out as part of the “CO2 Vision–Carbon Capture Portland” Lighthouse project financed through the React-EU COVID-19.
Related subjects: Applications & Pathways
Countries: Denmark

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