According to the Bloomberg NEF report on decarbonizing industries, achieving net-zero emissions requires a fourfold increase in investments in CCUS, hydrogen, and sustainable materials. Specifically, the report suggests that CCUS alone needs a substantial investment of $11.2 trillion by 2050. CCUS plays a crucial role in addressing emissions in sectors with limited alternative technologies, such as cement, iron and steel, chemicals, and the production of synthetic fuels for long-distance transport, especially in aviation.
As per IEA, the CCUS in industries will have to achieve a carbon emission reduction of 2,900 GtCO2 in order to achieve net zero emissions by 2050. This contribution from the CCUS in the emission reduction is about 37% of all the emission reduction from various measures in the industries.
CCUS encompasses capture, distribution, and sequestration, all costly processes due to the substantial volume of CO2 produced, up to three times the mass of the burned coal or natural gas. CCUS can add $168 to $196 per MWh to coal generation costs and $95 to $110 per MWh to methane plants, rendering them unprofitable.
Capture involves using sorbents or porous ceramic filters to trap CO2, requiring specific temperature ranges and components, leading to additional processing costs. Once captured, CO2 must be compressed or liquefied, both energy- intensive processes, further increasing expenses.
Transporting CO2 via trains or pipelines doubles or triples distribution costs compared to moving coal or gas. Storing the captured CO2 onsite requires large pressure vessels, significantly more expensive than storing coal.
The CCUS value chain not only raises costs for fossil-based systems but also renders them unviable compared to renewable sources like solar and wind, with added environmental challenges. Extensive CO2 capture necessitates a vast network of new pipelines, posing significant risks, as ruptured pipelines can release liquid CO2, which quickly turns into gas, posing health risks to humans and animals.
In this webinar, through the discussions with the experts, we will focus on
- Global CCUS market size for 2050
- Importance of use case of CCUS in Industries and its impact on decarbonization
- Technology & Energy Efficiencies of CCUS in key hard to abate industries of Iron & Steel and Thermal Power Plants
- The Imperative for CCUS as a decarbonizing technology despite Its Inefficiency and Use Case
- Technology selection as per application suitability for future
Key questions addressed in the webinar-
- What are the key elements constituting CCUS?
- Why is CCUS necessary for achieving Net Zero?
- Which sectors are poised to benefit from CCUS in the near future?
- What is the techno-economic feasibility of CCUS across key sectors?
- What is the current status of CCUS projects worldwide?
- How is the evolution of CCUS costs expected to unfold
- What investments are necessary for CCUS implementation?
- What are the key areas for improvement to enhance CCUS adoption?
Key takeaways
- Despite efforts to cut emissions, new fossil fuel plants are still being built. Hard-to-abate sectors, like iron and steel, are moving towards clean tech such as green hydrogen, awaiting scalability.
- CCUS is the sole carbon-negative technology available today, which will play a key role for enabling cleaner technology shifts in hard-to-abate sectors.
- The techno-economic feasibility of CCUS across key sectors is influenced mainly by carbon capture costs in its value chain, which vary with the CO2 concentration in the flue gas.
- High-CO2 sectors like fertilizers and natural gas processing are ideal candidates for CCUS implementation, with costs typically ranging from $15 to $25 per tonne of CO2.
- The utilization of captured CO2, along with the corresponding revenue generated, is a crucial factor in determining the feasibility of CCUS. Current applications include 65% in urea production, 25% in enhanced oil recovery, and 1-2% each in carbonated beverages, steel/metal industry, and medical industry.
- In India, generating methanol from captured CO2 will establish a revenue stream for CCUS. Methanol, serving as a precursor to various chemicals like acetic acid and dimethyl, will also reduce import dependence.
- CO2 finds applications in Sustainable Aviation Fuels and storage in basalt rock formations to produce limestone.
- To halve the cost of CCUS technology by 2030, we must optimize the entire value chain:
- Carbon capture: Explore cheaper mediums like carbonates, use plant steam for heat.
- Transport: Adopt a “clusters and valleys” approach for CO2 transportation efficiency.
- Utilization: Focus on methanol production, improve catalysts for scaling efficiency.
- The current CCUS status includes 41 operational facilities, with a capacity of around 49 Mt CO2 annually. Over 350 projects are in development, totalling 361 mtpa, with expected 50 new projects by 2030, with a capacity of approximately 125 mtpa. There are over 100 CCS networks in development. Investment in CCUS stands at $10 billion, constituting roughly 0.5% of the global annual clean energy investment in 2023.
- Out of 50 projects plant only 20 projects have seen the final investment decision
- To meet the required annualized level for CCUS implementation by 2030, an additional $510 billion is needed, as per the New Energy Outlook 2022 net zero scenario.
- Some policy interventions required to promote CCUS include,
- Promote collaboration among industries and nations through mechanisms like CBAM to incentivize the low emitting companies.
- Integrate CCUS into national roadmaps, (strategies varying by country which also affects the overall adoption of the tech)
- Creating CO2 markets, like through EOR which is important for driving adoption and investment.