ratios and result in lower cost for carbon-neutral fuels. The last column of Table 5.4 shows the case for gasification with biomass as the single feedstock. The costs are high because of the small plant size, limited by feedstock availability. However, the life-cycle CO2 emissions are net negative, which would be attractive if overall costs of production could be brought down.

The area of greatest uncertainty for conversion of coal and biomass into liquid fuels is the geologic storage of CO2. As of late 2008, few commercial-scale geologic storage demonstrations had been carried out or were ongoing. Yet well-monitored and commercial-scale demonstrations are needed to gather data sufficient to assure industry and governments of the long-term viability, costs, and safety of geologic CO2 storage and to develop procedures for site choice, permitting, operation, regulation, and closure. These objectives are particularly critical to the commercial success of thermochemical technology, which relies on the political and commercial acceptability of large-scale geologic storage of CO2.

The potential costs of CCS of $10–15 per tonne of CO2 avoided are “bottom-up” estimates, based largely on engineering estimates of expenses for transport, land purchase, permitting, drilling, capital equipment, storage, well capping, and monitoring for an additional 50 years. However, uncertainty about the regulatory environment arising from concerns of the general public and policy makers has the potential to raise storage costs and slow commercialization of thermochemical fuel production technology. Ultimate requirements for design, monitoring, carbon-accounting procedures, and liability for long-term monitoring of geologically stored CO2, as well as the associated regulatory frameworks, are dependent on future commercial-scale demonstrations of geologic storage of CO2. These demonstrations will have to be pursued aggressively over the next few years if thermo-chemical conversion of biomass and coal with geologic storage of CO2 is to be ready for commercial deployment in 2020 or sooner.

As a first step toward accelerating the commercial demonstration of coal-to-liquid and coal-and-biomass-to-liquid fuels technology and addressing the CO2 storage issue, commercial-scale demonstration plants could serve as sources of CO2 for geologic storage demonstration projects. So-called capture-ready plants that vented CO2 would create liquid fuels with higher CO2 emissions per unit of usable energy than petroleum-based fuels produce; commercialization of these plants would not be encouraged unless they were integrated with geologic storage of CO2 at their start-up.

Direct liquefaction of coal—which involves relatively high temperature, high hydrogen pressure, and liquid-phase conversion of coal directly into liquid

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