In order to reduce emissions of carbon dioxide from large point sources, new technologies can be used in capture plants for combustion of fossil fuel for subsequent capture and storage of CO2. One such technology is the O-2/CO2 combustion process (also termed oxy-fuel combustion) that combines a conventional combustion process with a cryogenic air separation process so that the fuel is burned in oxygen and recycled flue gas, yielding a high concentration of CO2 in the flue gas, which reduces the cost for its capture. In this work, the O-2/CO2 process is applied using commercial data from an 865 MW, lignite fired reference power plant and large air separation units (ASU). A detailed design of the flue gas treatment pass, integrated in the overall process layout, is proposed. The essential components and energy streams of the two processes have been investigated in order to evaluate the possibilities for process integration and to determine the net efficiency of the capture plant. The electricity generation cost and the associated avoidance cost for the capture plant have been determined and compared to the reference plant with investment costs obtained directly from industry. Although an existing reference power plant forms the basis of the work, the study is directed towards a new state of the art lignite fired O-2/CO2 power plant. The boiler power of the O-2/CO2 plant has been increased to keep the net output of the capture and the reference plant similar. With the integration possibilities identified, the net efficiency becomes 33.5%, which should be compared to 42.6% in the reference plant. With a lignite price of 5.2 $/ MW It and an interest rate of 10%, the electricity generation cost increases from 42.1 to 64.3 $/MW h, which corresponds to a CO2 avoidance cost of 26 $/ton CO2. (c) 2005 Elsevier Ltd. All rights reserved.