Carbon Capture Technologies Set to Become a Trillion-Dollar Business

The window to prevent the catastrophic 2°C temperature limit is quickly closing. An update from the WMO released on May 17 says we will “more likely than not breach 1.5°C of warming within the next five years”. However, the world has yet to peak its fossil fuel emissions.

Climate change is an urgent problem, and reducing emissions won’t solve the crisis alone. Still, it would need the help of technologies that would remove carbon dioxide from the atmosphere, capture it from the source, and store it permanently.

In the past, these technologies that scrub carbon from the atmosphere – direct air carbon capture and storage (DACCS) direct carbon capture and storage have been considered controversial. Still, innovations and support from big oil companies and other high-emitting industries are making these technologies.

Fossil fuel still has a role to play

Sultan Al Jaber, president of the upcoming COP28 climate summit in Dubai, says, “We know that fossil fuels will continue to play a role in the foreseeable future in helping meet global energy requirements”.

He calls for a focus on technologies to capture GHG emissions produced from fossil fuel use, adding that the world needs “to come to terms with some realities” and embrace an energy transition that includes “all sources of energy” during a Petersberg Climate Dialogue in Berlin, a conference attended by representatives from around 40 countries to help set the agenda for the COP28 on November 30 until December 12, 2023.

UN Secretary-General António Guterres, referring to the findings of the 2022 IPCC report, says that the “climate time bomb is ticking” and that “the 1.5-degree limit is achievable … But it will take a quantum leap in climate action,” he said. “In short, our world needs climate action on all fronts—everything, everywhere, all at once.”

According to the IPCC report, “All available studies require at least some kind of carbon dioxide removal to reach net zero; that is, there are no studies where absolute zero GHG or even CO2 emissions are reached by deep emissions reductions alone.”

The IPCC 2022 report on mitigating climate change says, “The deployment of carbon dioxide removals to counterbalance hard-to-abate residual emissions is unavoidable if net zero…emissions are to be achieved.”

Various ways to remove and capture carbon

CNN features several forms of carbon capture and removal technologies that exist today and can be scaled up:

• Carbon capture utilisation and storage involves capturing carbon pollution from power plants and industrial facilities and reusing or storing it underground.
• Bioenergy with carbon capture and storage (BECCS) – taking trees and plants removes CO2 from the air and burns them to produce energy. The emissions they have are captured and stored underground.
• Direct-Air Capture (DAC) – machines that suck in air and extract the CO2 using chemicals. Emissions are either stored underground or can be reused.
• Biochar – burning woods, dead leaves, or plants in low oxygen to create a form of charcoal called “biochar”, which is added to the soil as fertiliser. It also removes CO2 from the air.
• Tree planting – planting trees and restoring forests is also a form of carbon removal because they absorb CO2 as they grow.
• Ocean fertilisation – adding nutrients such as iron particles to the ocean to increase the growth of plankton, which also pulls carbon dioxide from the atmosphere.
• Enhanced rock weathering – adding finely ground rocks such as basalt to land to cause a chemical reaction that captures CO2 from the air.

The pathways laid out by the IPCC, including carbon removal and capture, will require markets and governments to invest significantly in these technologies. While this may be challenging initially, investments could create huge business opportunities and other co-benefits, like job creation and biodiversity benefits.

The Economist reckons that carbon removal could become a trillion-dollar industry. Big oil companies and tech giants such as Microsoft are investing in carbon capture technology to cater to businesses that want to get out their carbon emissions and are willing to pay for every tonne of emissions stashed away.

For now, Climework’s direct air capture plant in Iceland, ORCA, has the largest carbon removal capacity, scrubbing 4,000 tonnes of carbon dioxide from the air annually. However, a myriad of startups around the world are attracting capital.

One is in Texas, where Occidental Petroleum, an American oil firm, claims to construct the world’s first commercial-scale “direct air capture” (DAC) plant to remove 500,000 tonnes of CO2 annually once fully operational in 2025. Occidental also plans to build 100 large-scale DAC facilities by 2035.

Others attempt to prevent carbon emitted by power plants and industries from entering the atmosphere using a process known as carbon capture and storage (CCS).

ExxonMobil, an oil major, reveals its plans to offer decarbonisation for hard-to-decarbonise sectors like steel and cement producers because they think they could earn annual revenues of $6 trillion by 2050.

In America alone, their climate targets require them to capture and store between 400m and 1.8bn tonnes of CO2 annually by 2050. Globally, Wood Mackenzie, an energy consultancy, thinks that various forms of carbon removal account for a fifth of the global emissions reductions needed to emit no net greenhouse gases by 2050. If their estimates are correct, the article notes that 8 billion tonnes of CO2 per year would need to be scrubbed from the atmosphere yearly, which means many industrial-scale carbon removal plants are required.

According to the article, carbon removal and capture are becoming more feasible and profitable. First, there is a push for governments to increase the price of carbon high enough for polluters to make it in their interest to pay for carbon removers to suck their emissions either from the source or from the atmosphere. Second, the price of sequestered carbon from direct air capture technologies is decreasing. The American Physical Society puts the cost of DAC at $600 per tonne captured in 2011. This time, with high optimism and cheaper technology, according to a 2018 paper published in Joule, the cost puts Carbon Engineering’s DAC system at between $94 and $232 per tonne, much less than a decade ago and closer to the EU’s carbon price.

Carbon capture and storage technology (CCS) by a Canadian startup, Svante, is even cheaper. Using inexpensive materials to capture CO2 from the source, from the industrial flue, costs around $50 a tonne.

Technologists, investors, and policymakers are starting to view carbon removal technologies the same as waste management decades ago; it was very pricey, to begin with, and needed public support to get going, but it turned profitable in the long term.