Record carbon emissions propel alternative solutions to the forefront

Humanity's inability to curtail carbon emissions, which reached unprecedented levels in 2023, has brought previously overlooked methods for limiting or reducing CO2 in the atmosphere to the forefront.

Carbon capture and storage (CCS) and direct air capture (DAC) are intricate industrial processes designed to isolate CO2, yet these emerging technologies, now experiencing rapid growth, are distinct and often conflated.

On Thursday, a consortium of major energy firms, including BP from the UK and TotalEnergies from France, announced £4 billion ($5.1 billion) in contracts for a gas power plant in Britain equipped with CCS.

Here's an overview of what they entail and how they differ:

- CCS, or Carbon Capture and Storage -

CCS involves extracting CO2 from the exhaust, or flue gas, of fossil fuel-fired power plants and heavy industries. While CO2 comprises about 12 percent of emissions from coal-fired power plants, it doubles in steel and cement production. CCS primarily prevents additional CO2 from entering the atmosphere.

In contrast, DAC, or Direct Air Capture, retrieves CO2 molecules already present, constituting a "negative emissions" technology. DAC may earn credits for companies seeking to offset greenhouse gas emissions, provided the captured CO2 is permanently stored, such as in depleted oil and gas reservoirs or saline aquifers.

The ambient air's carbon dioxide concentration stands at only 420 parts per million, rendering DAC's CO2 extraction highly energy-intensive.

Once isolated by either CCS or DAC, CO2 can be utilized to produce items like building materials or eco-friendly aviation fuel, although some CO2 may inevitably re-enter the atmosphere.

- Current Landscape -

While the fossil fuel industry has employed CCS since the 1970s, it was primarily for enhanced oil recovery rather than preventing CO2 emissions. Integrating CCS facilities into existing coal and gas-fired power plants and then storing captured CO2 underground has been technically viable but economically unfeasible.

The world's largest CCS plant, the Petra Nova facility in Texas, shut down just three years after opening in 2017. However, mounting climate concerns and substantial government subsidies have reignited interest in CCS across various sectors.

In fall 2023, approximately 40 commercial-scale facilities worldwide were implementing carbon capture technology, with a total CO2 isolation of 45 million tonnes, as reported by the International Energy Agency (IEA). While CO2 capture capacity could increase eightfold by 2030 if all planned projects materialize, only five percent of announced projects have reached the final investment stage.

In contrast, DAC is relatively new, with fewer than 30 plants globally capturing about 10,000 tonnes of CO2 annually, equivalent to global emissions in approximately 10 seconds.

- Scaling Up -

Both CCS and DAC must undergo substantial expansion to significantly contribute to global decarbonization efforts. By 2030, CCS would need to divert 1.3 billion tonnes annually from power and industry, a 30-fold increase from current levels, to maintain the mid-century net-zero target, according to the IEA. DAC would need to remove 60 Mt CO2 per year by then, a considerable escalation.

While the nascent industry sees the emergence of new players, scaling up presents a monumental challenge. The first million-tonne-per-year DAC plant, developed by Occidental Petroleum in Texas, is slated to launch in the United States next year.

Plans for at least 130 DAC facilities are currently underway, highlighting growing interest in this sector.

- Financial Dynamics -

CCS costs range from $15 to $20 per tonne for highly concentrated CO2 streams in industrial processes, while DAC costs significantly more, ranging from $600 to $1,000 per tonne of CO2 captured. However, these costs are projected to decline to $100-$300 per tonne by 2050.

As nations and companies grapple with decarbonization targets, substantial public and private investments are flowing into both CCS and DAC. In the United States, legislation like the Inflation Reduction Act (IRA) and the Infrastructure Investment and Jobs Act provide billions of dollars in tax credits and funding for CCS initiatives.

Similar initiatives exist in Canada, South Korea, China, and Europe, where government support is directed towards industry and storage, especially in the North Sea.

DAC is also attracting considerable attention from private entities, with major companies pledging to invest in "permanent carbon removal" initiatives by 2030. Climeworks, a leading DAC pioneer based in Switzerland, recently secured a deal to sell carbon removal credits to airline companies SWISS and Lufthansa, signaling growing interest and investment in this space.