According to the Intergovernmental Panel on Climate Change (IPCC), traditional emissions reduction measures like renewable energy and electric vehicles alone may not be sufficient to limit global warming to less than 2°C above pre-industrial levels. Therefore the growing importance of carbon removal technologies, such as carbon capture and storage (CCS) and direct air capture (DAC), is seen as fundamental in combating climate change.
The Department of Energy in the United States estimates that capturing and storing between 400 million and 1.8 billion tonnes of CO2 annually by 2050 is necessary to meet the country’s climate goals. Wood Mackenzie, an energy consultancy, suggests that various forms of carbon removal could contribute up to a fifth of the global emissions reductions required for achieving net-zero greenhouse gas emissions by 2050. This would equate to removing more than 8 billion tonnes of CO2 annually.
In the past, carbon removal projects were considered technically feasible but economically unviable. However, the situation is changing due to advancements in technology and decreasing costs. The cost of DAC systems, for example, has reduced significantly, with estimates ranging from $94 to $232 per tonne of CO2 when operating at scale. This is much lower than the previous estimate of $600 per tonne. CCS is also becoming more promising, with companies like Svante able to capture CO2 from industrial flue gas for around $50 per tonne.
Moreover, some companies are exploring ways to utilise the captured carbon for commercial purposes. For instance, CarbonFree and LanzaTech are converting captured CO2 into specialty chemicals and useful materials. These innovative approaches could potentially make carbon removal projects economically viable by creating marketable products.
As a result of these developments, Wood Mackenzie predicts that the global carbon capture, utilisation, and storage (CCUS) sector could attract around $150 billion in investments throughout this decade. The consultancy also anticipates a more than sevenfold increase in global CCUS capacity, which includes CCS, DAC, and various utilisation methods, by 2030.
(Source: The Economist / Wood Mackenzie)