Essays on investment in carbon capture technology: the role of markets, competitors and policy

Rights statement
Awarding institution
  • University of Strathclyde
Date of award
  • 2022
Thesis identifier
  • T16212
Person Identifier (Local)
  • 201677952
Qualification Level
Qualification Name
Department, School or Faculty
  • In this thesis, three different economic models under an industrial organization approach are presented modelling different types of carbon capture technology adoption. The thesis aims to understand the incentives that drive a carbon capture technology decision making at a firm level and develop policy solutions to inform government and policymakers to increase carbon capture technology adoption. The first model constructed considers a carbon capture and storage (CCS) technology adoption in different competitive environments. The focus is to explore how competition influences a firm’s decision toward CCS technology. The second model investigates the strategic interaction that firms experience in an industry where a firm adopts carbon capture and CO2 utilization (CCU). The model also evaluates the environmental impact of a CCU industry, as a major drawback of final goods produced by CO2 utilization is the carbon emissions are released back into the atmosphere once consumed in the final goods market. In this chapter, a series of policy solutions are proposed to obtain an increase in the adoption of CCU whilst accomplishing a positive environmental impact. The third model investigates the optimal CCS adoption decision time of a follower influenced by a learning-by-doing and spillover effect. A follower is a firm that adopts a second-generation CCS technology with a lower production cost caused by a learning effect from a pioneer. A pioneer is a firm that adopts a first-generation CCS technology with a high production cost, and it experiences a learning-by-doing effect. We discover, that if the adoption of CCS technology is sequential, a pioneer is always at an economic disadvantage by adopting first. The main contribution of this chapter recommends a policy solution that balances the adoption cost of a pioneer and a follower, achieving an increase in the diffusion of CCS technology.
Advisor / supervisor
  • Nimubona, Alain-Dersire
  • Dickson, Alex
  • Quigley, John, Dr.
Resource Type
Date Created
  • 2021