Evaluating the Economic Feasibility of Industrial Carbon Capture and Storage (CCS) in Emerging Economies

Industrial decarbonization in emerging economies presents a profound strategic challenge due to the confluence of high upfront capital requirements, volatile global energy markets, political risks, and nascent regulatory frameworks. This study provides an expanded techno-economic evaluation of the financial viability of integrating point-source Carbon Capture and Storage (CCS) technology within heavy industrial clusters in emerging market contexts. Utilizing an extended quantitative cash flow model based on Net Present Value (NPV), Internal Rate of Return (IRR), Levelized Cost of Carbon Abated (LCCA), and Sensitivity Hazard Metrics, we analyze a representative 1.5 Mt CO2/year industrial facility over a 20-year operational life cycle. Baseline empirical modeling indicates that under an unassisted market environment with a nominal carbon credit of $35/t CO2, standalone CCS retrofitting incurs a net present loss of -$142.5 million and fails to achieve financial breakeven. However, when evaluated under a structured multi-tiered policy intervention framework combining a $65/t CO2 tax credit, a 20% capital grant, and blended international concessional loans that lower the Weighted Average Cost of Capital (WACC) from 10% to 6.5% the project yields a positive NPV of $89.6 million and an attractive IRR of 14.1%. Extensive sensitivity analysis demonstrates that project viability is most vulnerable to fluctuations in natural gas and electricity pricing required for solvent regeneration, followed by carbon credit volatility.