Is Carbon Capture and Storage the Answer to Decarbonization?

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picture of a smokestack for an article about what is carbon capture and decarbonization

Many industries seeking to decarbonize operations are turning to carbon capture and storage (CCS) technologies to help them reduce emissions. This is particularly true in the oil and gas industry, as well as in hard-to-abate industries, such as chemicals, cement and steel. The adoption of CCS technologies is being strongly encouraged by some governments, supported by climate policies and state funding. However, not everyone is so positive about the benefits of CCS tech, with environmental activists saying that the emissions problem should be cut at the source rather than the endpoint and many scientists believing the capabilities of these technologies are being overstated. 

U.S. Companies Betting Big on CCS

CCS technologies are used in industries where it is difficult to cut carbon emissions, such as in fossil fuel production and heavy industry, to reduce CO2 emissions. CCS tech works by sequestering carbon dioxide released during industrial activities or oil and gas production and transporting it to be stored deep underground, rather than released into the atmosphere to contribute to climate change. A 2023 study suggests that applying CCS to a modern conventional power plant could reduce CO2 emissions to the atmosphere by approximately 80% to 90% compared to a plant without CCS.

This has led the U.S. government to support the rollout of CCS technologies in hard-to-abate industries in support of national decarbonization aims. The Biden administration’s Inflation Reduction Act provides financial incentives, such as tax breaks, to companies who adopt CCS equipment, to encourage more industries to do the same. In total, the U.S. government has earmarked $3.7 billion in funding to support CCS. 

Several companies in the U.S. are now betting big on CCS technology as being the key to decarbonizing their operations. By March this year, around 80 CCS projects in the U.S. were projected to be operational by 2030, with the national carbon capture capacity expected to increase fivefold, to over 100 metric tons of CO2 a year. Some of the biggest companies investing in CCS technologies include Exxon Mobil Corp, Chevron, ConocoPhillips and Occidental Petroleum Corp. 

Heirloom’s Major New Plant

In November, Heirloom Carbon Technologies opened what it calls the first commercial plant in the United States to use direct air capture carbon-cutting technology. The equipment, which critics have been highly skeptical about, sucks carbon dioxide directly from the air. Heirloom’s facility takes the CO2 and seals the gas permanently in concrete. The company aims to sell carbon credits to earn money, offering companies the opportunity to offset their carbon emissions. In September, Microsoft signed a deal with Heirloom to remove 315,000 tons of carbon dioxide from the atmosphere. 

The company’s first facility, in Tracy, California, can absorb a maximum of 1,000 tons of carbon dioxide per year, equivalent to taking around 200 cars off the roads. However, Heirloom hopes this will be the first of many facilities, with plans to rapidly scale up its operations as interest in the service increases. Shashank Samala, Heirloom’s CEO, stated “We want to get to millions of tons per year.” 

Is it All Just Hype?

Despite the optimism surrounding the wide-scale rollout of CCS technology, many remain skeptical about the efficacy of CCS. Politicians, environmental activists, and residents in areas with CCS projects are concerned about the risks and environmental impact of the technology. Environmentalists believe that supporting the rollout of CCS technology as a means of decarbonization will encourage companies to maintain their current operational practices rather than looking for ways to cut greenhouse gas emissions from the outset by using renewable energy sources and clean technologies to power operations. Based on demand, emissions are expected to increase across several industries, leading them to use CCS technologies to decarbonize rather than cutting emissions at the source

Others are simply concerned about the risks of transporting carbon dioxide and pumping it into the ground to be stored. Iowa-based Summit Carbon Solutions and Nebraska-based Navigator CO2 Ventures both proposed massive pipelines capable of transporting sequestered carbon to underground storage sites in other states. Their permit applications were rejected in North Dakota, South Dakota, Iowa, and Illinois based on the response from landowners concerned about the impact on farmland in the region. 

As well as concerns that the adoption of CCS technologies will encourage companies to continue emitting greenhouse gasses without consequence, many experts believe the function of these technologies is highly overstated. A 2022 Institute for Energy Economics and Financial Analysis (IEEFA) study found that out of 13 projects examined, accounting for 55% of the world’s operational capacity at the time of publication, seven underperformed, two failed, and one was mothballed. 

Bruce Robertson, the author of the IEEFA report, stated, “Many international bodies and national governments are relying on carbon capture in the fossil fuel sector to get to net zero, and it simply won’t work.” He added, “Although [there is] some indication it might have a role to play in hard-to-abate sectors such as cement, fertilizers and steel, overall results indicate a financial, technical, and emissions-reduction framework that continues to overstate and underperform.” 

While the rollout of CCS technologies may offer an effective short-term solution to decarbonizing hard-to-abate industries, governments should be focusing on a long-term solution to ensure that the use of CCS does not extend the life of fossil fuel infrastructure beyond the cut-off point for maintaining atmospheric carbon at less than catastrophic levels. Companies in the U.S. should be encouraged to invest in the use of renewable energy and clean technologies to clean up operations through incentives provided under national climate policies and in line with government aims for a green transition. 

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