To achieve carbon neutrality and thus effectively implement the Paris Climate Agreement1 and the 2030 Agenda for Sustainable Development2, the United Nations is calling for the rapid deployment of carbon capture, utilization and storage (CCUS). The current form of carbon dioxide utilization under CCUS is to use carbon dioxide as a displacement tool to enhance oil recovery (EOR) in mature oil fields. This techniques help extract a larger portion of the oil in place by injecting captured CO2, thereby increasing overall oil recovery and extending the life of the reservoir. However, as the efficiency of power generation from thermal power plants generally declines after carbon capture and storage (CCS) retrofit, the future development of enhanced oil recovery through CCUS is filled with uncertainties. As a market-oriented policy tool, it is widely recognized that the carbon trading mechanism as well as feed-in tariff can effectively enhance the value of CO2 recycling technologies and promote their implementation. In this context, both a deferred and growth options are analyzed using the continuous time model to overcome the shortcomings of traditional investment decision criteria such as NPV. The results of the sensitivity analysis show that a higher carbon and oil price is needed to ensure a cost- effective investment in carbon capture (CCS) and utilization (EOR) projects respectively. It is suggested that the implementation of a specific feed-in tariff program for thermal power plants equipped with CCS technology can offset the shortfall in efficiency loss caused by technology retrofit. Accelerating CCS development in the short term also requires the combined efforts of other powerful political incentives.