Carbon Capture, Utilisation and Storage

Countries and regions making notable progress in CCUS include: 

• The United States announced important opportunities in 2022 that are expected to boost CCUS project development, including new funding under the 2021 Infrastructure Investment and Jobs Act and favourable CCUS tax credit changes in the 2022 Inflation Reduction Act. 
• The European Union launched the Net Zero Industry Act in March 2023, proposing an annual CO₂ injection target of 50 Mt CO₂/yr for 2030 and improved permitting procedures for CCUS. Additionally, the pilot phase of Project Greensand in Denmark became operational in March 2023, transporting CO₂ from Belgium for storage in a depleted oil field of the Danish North Sea. 
• The United Kingdom announced GBP 20 billion in its Spring Budget 2023 for the early deployment of CCUS projects. 
• Indonesia finalised its legal and regulatory framework for CCUS in March 2023, making it the first country in the region to establish a framework for CCUS activities.  
• In China, three new projects became operational in 2023, while Japan selected seven candidate projects for support towards their commercialisation. 
  

There are now around 40 commercial capture facilities in operation globally, with a total annual capture capacity of more than 45 Mt CO₂. Seven new large-scale (capture capacity over 100 000 tCO₂/yr, and over 1 000 tCO₂/yr for DAC applications) capture facilities have come online since January 2022, including the Red Trail Energy Project in the United States, the Arcelor LanzaTech Carbalyst (Steelanol) project in Belgium, the Global thermostat DAC pilot in the US, and four projects in China (at the Sinopec Qilu Petrochemical Shengli facility, the Jiling Petrochemical CCUS facility, the CNOOC Enping oil field, and the China Energy Taizhou power plant). While more than 50 new capture facilities targeting operation by 2030 have been announced since January 2022, the pipeline of current projects is only just around a third of the NZE Scenario requirement in 2030.  

Momentum behind CCUS has been growing since around the start of 2018. Since January 2022 project developers have announced ambitions for over 50 new capture facilities to be operating by 2030, capturing around 125 Mt CO₂ per year. However, as of June 2023, only around 20 commercial capture projects under development have taken a final investment decision (FID). Specific CO₂ transport and storage related activities and progress are reported in CO₂ Transport and Storage. 

The widespread adoption of economy-wide decarbonisation targets for 2050 is stimulating the diversification of CO₂ capture applications. Currently, around 65% of operating CO₂ capture capacity is at natural gas processing plants, one of the lowest-cost CO₂ capture applications, but new CCUS developments are increasingly targeting other applications. Based on the current project pipeline, by 2030 annual capture capacity from both new construction and retrofits could amount to around 90 Mt CO₂ from hydrogen production, around 80 Mt CO₂ from power generation and around 35 Mt CO₂ from industrial facilities (e.g. cement and steel production).  

Bioenergy with carbon capture and storage (BECCS) and direct air capture (DAC) with CO₂ storage are key carbon dioxide removal technologies. Globally, over 40 bioethanol facilities, among the lowest-cost BECCS applications, have announced plans to capture CO₂, and around 25 biomass and waste-fired combined heat and power plants could be capturing around 30 Mt CO₂ by 2030. The first large-scale DAC plant (0.5 Mt CO₂/year) is scheduled to commence operations in 2025 in the United States. 

The geographic distribution of CO₂ capture projects in development is diversifying, with projects now being developed in more than 45 countries. Beyond North America and Europe, good progress has also been made in:  

• Asia Pacific (including China), where around 10 capture projects have been announced since January 2022, which could lead to a total capture capacity of around 45 Mt CO₂ per year by 2030.  
• The Middle East, where around ten projects are in development across the region in addition to the three already in operation. In 2022, Bahrain announced plans to study the implementation of CCUS for aluminium smelting. In Qatar, construction continues on the North Field East liquified natural gas (LNG) project, which will expand Qatar’s CCUS capacity from more than 2 Mt CO₂/year to 5 Mt CO₂/year by 2025.  
  

Several technological innovations that have been proposed to reduce CCUS costs for power generation are now being tested: 

• NET Power’s 50 MW clean energy plant (commissioned in 2018) is a first-of-its-kind natural gas-fired power plant employing Allam cycle technology, which uses CO₂ as a working fluid in an oxyfuel supercritical CO₂ power cycle, which could significantly reduce capture costs.  
• Net Zero Teesside Power in the United Kingdom is expected to come online in 2027 and could become one of the first commercial-scale gas-fired power stations with CCUS. The project was named as an investment priority in a UK government announcement in March 2023. 

CCUS applied to the industrial sector has also made progress. In 2022 a number of new projects were commissioned: 

• One large-scale demonstration project retrofitting CCUS to iron and steel production was commissioned in Belgium, bringing the number of large-scale operating CCUS projects on iron and steel to two. A smaller pilot also started in France. 
• Two CCUS projects were retrofitted to chemical production, in the United Kingdom and China. 
• A project in China to capture CO₂ emissions from fertiliser production was commissioned. 

While the most advanced and widely adopted capture technologies are chemical absorption and physical separation, other separation technologies under development include membranes and looping cycles (such as chemical looping and calcium looping). 

In addition to technology improvements, different trends could further improve the techno-economic performance of CO₂ capture. Examples include modularisation of capture systems within self-contained, plug-in systems (with the potential to reduce land footprint, costs and lead times of capture retrofits across applications) and hybridisation of different capture technologies within capture systems (to increase capture rates while reducing costs and/or energy penalty). 

Higher CO₂ capture rates will be essential for CCUS to play its role in the transition to a net zero energy system. CCUS-equipped power and industrial plants operating today are designed to capture around 90% of the CO₂ from flue gas. While there are no technical barriers to increasing capture rates beyond 90% for the most mature capture technologies, capture rates of 98% or higher require larger equipment, more process steps and higher energy consumption per tonne of CO₂ captured, which increases unit costs. However, initial results based on chemical absorption systems applied to power generation plants are promising, showing that CO₂ capture rates as high as 99% can be achieved at comparably low additional marginal cost relative to the cost of deploying 90% capture.  

• United States: In 2021, the US passed the Infrastructure Investment and Jobs Act (IIJA), which provides approximately USD 12 billion across the CCUS value chain through 2026. In 2022, the Department of Energy announced important new funding opportunities under the IIJA, including USD 45 million for CCUS in power and industrial applications; USD 820 million for large-scale carbon capture pilot projects; and USD 1.7 billion for carbon capture demonstration projects. In April 2023 the United States announced a ‘’Carbon Management Challenge’’ ahead of the 28th Conference of the Parties (COP), inviting countries to accelerate CCUS internationally. 
• United Kingdom: Under the Spring Budget 2023, GBP 20 billion in funding was announced for the early deployment of CCUS projects, particularly on the East Coast and in the North West of England, and in North Wales. 
• European Union: In March 2023 the European Commission introduced the Net Zero Industry Act, which identifies CCUS as a strategic net zero technology for which scaling up of manufacturing capacity is critical to reaching the EU’s climate goals. Specifically, the Act proposes to set an EU-wide goal to achieve an annual CO₂ injection capacity of 50 Mt by 2030, with oil and gas producers asked to contribute, in addition to setting clear timelines for permitting CCUS projects. 
• Canada: As part of its Budget 2023, Canada proposed an expansion and additional design details for its investment tax credit for CCUS projects. The changes allow dual-use equipment for heat and power to qualify for the tax credit and establish third-party certification requirements for CO₂ storage in concrete, among other things. 
• Indonesia: Successfully deploying CCUS relies on the establishment of legal and regulatory frameworks to ensure the effective stewardship of CCUS activities and the safe and secure storage of CO₂. In March 2023, the Indonesian Ministry of Energy and Mineral Resources finalised a legal and regulatory framework for CCUS activities. Rooted in the country’s oil and gas regulations, the new framework is the first of its kind in the region. 
• Japan: In January 2023 Japan issued a CCUS roadmap, which sets an annual CO₂ storage target of 6-12 Mt CO₂ per year for 2030 and 120-140 Mt CO2 per year for 2050. For more information see CO₂ transport and storage. 
  

• Abdul'Aziz A. Aliyu, Technology Collaboration Programme on Greenhouse Gas R&D/IEAGHG  
• Keith Burnard, Technology Collaboration Programme on Greenhouse Gas R&D/IEAGHG  
• Tim Dixon, Technology Collaboration Programme on Greenhouse Gas R&D/IEAGHG  
• Nirvasen Moonsamy, Oil and Gas Climate Initiative 
• Rachael Moore, CO2 Management Solutions.