Direct Air Capture

Countries and regions making notable progress to advance DAC technologies include: 

• The United States announced important new funding in 2022 under the Inflation Reduction Act (IRA), increasing the 45Q tax credit to USD 180/t CO₂ captured for storage via DAC, with a capture threshold of as little as 1 kt CO₂/year. 
• The European Commission aims to store up to 50 MtCO₂ a year by 2030, including from DAC. 
• In the United Kingdom, the budget announced in March 2023 included funding of up to GBP 20 billion (around USD 25 billion) for carbon capture, utilisation and storage (CCUS) applications, including for DAC. 
• Canada: the 2022 federal budget proposed an investment tax credit for CCUS projects between 2022 and 2030, valued at around 60% for DAC projects when CO₂ is stored at an eligible permanent sequestration site. 
• In January 2023 Japan set a carbon capture roadmap with a target of capturing between 6 and 12 MtCO₂ per year by 2030, including from DAC. 
  

To date, 27 DAC plants have been commissioned in Europe, North America, Japan and the Middle East. All of these plants are small-scale, with only a few commercial agreements in place to sell or store the captured CO₂, while the remaining plants are operated for testing and demonstration purposes. 

Six DAC projects are currently under construction, with the largest two expected to come online in 2024 in Iceland (36 kt CO₂/year) and in 2025 in the United States (500 kt CO₂/year, with plans to scale up to as much as 1 000 kt CO₂/year).  

Fast-growing demand for air-captured CO₂, for both carbon removal and low-emission synthetic hydrocarbon fuel production, is translating into several announcements for new, larger plants. Overall, plans for at least 130 DAC facilities are now at various stages of development. Some of the largest projects under development are in the United States (STRATOS, Oxy-CE Kleberg County project and HIF eFuels Matagorda County project in Texas, and Bison in Wyoming), the United Kingdom (the North-East Scotland DAC project), Norway (the Kollsnes DAC project) and Iceland (the Mammoth project).  

Plans for a total of 16 DAC facilities are now in advanced development or under construction. If all of these planned projects go ahead and steadily capture CO₂ at full capacity, DAC deployment would reach around 4.7 Mt CO₂ by 2030; this is more than 500 times today’s capture rate, but less than 7% of the 75 Mt CO₂ needed to get on track with the NZE Scenario. All the remaining projects are still at a very early stage, with no funding committed, and, in certain cases, not even an identified location for deployment. 

Two technological approaches are currently being used to capture CO₂ from the air: solid and liquid DAC. Solid DAC (S-DAC) is based on solid adsorbents operating at ambient to low pressure (i.e. under a vacuum) and medium temperature (80-120 °C). Liquid DAC (L-DAC) relies on an aqueous basic solution (such as potassium hydroxide), which releases the captured CO₂ through a series of units operating at high temperature (between 300 °C and 900 °C). 

Capturing CO₂ from the air is more energy intensive – and therefore more expensive – than capturing it from a point source. This is because CO₂ in the atmosphere is much more dilute than, for example, in the flue gas of a power station or a cement plant.  

In current DAC plant configurations, the proportion of heat in the total energy needed is influenced by the operating temperature of the technologies. Both S-DAC and L-DAC were initially designed to operate using both heat and electricity, with flexible configurations allowing for heat-only or electricity-only operation. 

A diverse portfolio of technologies exist for S-DAC, differing in energy intensity, operating temperature, and therefore cost.  

Emerging DAC technologies relying on innovative separation systems, with the main goal of reducing the energy intensity of the processes, include: 

• Electro swing adsorption (ESA)-DAC is based on an electrochemical cell where a solid electrode adsorbs CO₂ when negatively charged and releases it when a positive charge is applied. ESA-DAC is currently being developed in the United States and United Kingdom. 
• Zeolites are now being adopted for DAC thanks to their porous structure suitable for CO₂ adsorption. The first operational DAC plant relying on zeolites was commissioned in 2022 in Norway, with plans to scale the technology up to 2 000 tCO₂/year by 2025 through the project Removr. 
• Passive DAC relies on accelerating the natural process that transforms calcium hydroxide and atmospheric CO₂ into limestone. This process is being engineered in the United States by a company using renewably powered kilns to separate CO₂ from limestone.  

While the most energy intensive step in DAC operation is the re-release of the CO₂ after capture, energy savings can also be obtained by targeting other operations, such as the compression of large volumes of ambient air through large fans. This process can be optimised by combining DAC with existing ventilation systems such as those already operating within buildings.  

While S-DAC could be powered by a variety of low-carbon energy sources (e.g. heat pumps, geothermal, nuclear, solar thermal and biomass-based fuels), the current high temperature needs of today’s L-DAC configuration does not allow that level of flexibility. At best, L-DAC could operate using low-carbon fuels such as biomethane or renewables-based electrolytic hydrogen, but in the future L-DAC could shift to fully electric operation (currently only available for small-scale calcination). Large-scale L-DAC plants have been designed to use natural gas for heat and to co-capture the CO₂ produced during combustion of the gas without the need for additional capture equipment. This integration substantially reduces the L-DAC plant’s overall emissions and can still enable carbon removal. However, any future ability of renewable energy to supply high-temperature heat could further reduce the process emissions, maximising the potential for carbon removal and associated revenue streams. Accelerating the commercial availability of large-scale electric calcination technology is considered a high priority to enable L-DAC plants to operate purely on renewable energy. 

A major advantage of DAC is its flexibility in siting: in theory, a DAC plant can be situated in any location that has low-carbon energy and a CO₂ storage resource or CO₂ use opportunity. Yet there may be limits to this siting flexibility. To date, DAC plants have been successfully operated in a range of climatic conditions, mostly in Europe and North America, but further testing is still needed in locations characterised, for instance, by extremely dry or humid climates, or polluted air. In the Middle East, at least five projects are investigating or plan to investigate DAC operating performances in the region, for storage in peridotite formations. One of them, when operational, will become the first DAC-based carbon removal project relying on sea water for its operation.  

The choice of location also needs to be based on the energy source needed to run the DAC plant. The energy used to capture the CO₂ will determine if and how net-negative the system is, and can also be a significant determinant of the cost per tonne of CO₂ captured. For instance, both S-DAC and L-DAC technologies could be fuelled by renewable energy sources, while recovered low-grade waste heat could power an S-DAC system.  

Carbon removal requires the CO₂ to be permanently stored. While the overall technical capacity for storing CO₂ underground worldwide is understood to be vast, detailed site characterisation and assessment to render potential storage sites operational are still needed in many regions. An operating CO₂ storage site can take around four to ten years to develop from project conception to CO₂ injection. This could become a bottleneck for DAC deployment (and CCUS deployment in general) without accelerated efforts to identify and develop CO₂ storage sites. 

• The United States has established a number of policies and programmes to support DAC, including the 45Q tax credit and the California Low Carbon Fuels Standard credit (traded at an average of around USD 65/t CO₂ in Q4 2022). The Inflation Reduction Act (IRA) announced in August 2022 expands and extends the 45Q tax credit up to USD 180/t CO₂ permanently stored. The Infrastructure Investment and Jobs Act (signed into law in November 2021) includes USD 3.5 billion in funding to establish 4 large-scale DAC hubs, and related transport and storage infrastructure (the first funding opportunity announcement under this programme closed in March 2023). Around 35 DAC projects have been announced in the USA since the IRA, including project Bison (aiming to capture 5 MtCO₂/year by 2030) and 30 DAC plants in King Ranch, Texas (each up to 1 MtCO₂/year each, up to 15 of which could be operational by 2030).  
• Canada's 2021 federal budget included a planned investment tax credit for CCUS projects. Further details were outlined in the 2022 federal budget; the tax credit will be set at 60% for investment in DACS equipment from 2022 to 2030. Moreover, Environment and Climate Change Canada (ECCC) has been working since 2022 on an offset protocol for DAC as part of their Greenhouse Gas Offset Credit System. 
• The European Commission has been supporting DAC through various research and innovation programmes, including Horizon Europe and the Innovation Fund. In December 2021 the Commission released its first Communication on Sustainable Carbon Cycles, suggesting that by 2030 5 Mt of CO₂ should be removed annually from the atmosphere and permanently stored through various carbon dioxide removal (CDR) solutions including DAC, while in November 2022, it released its first proposal for a regulation on an EU certification for carbon removals. In April 2023 a new law was agreed to cut aviation emissions by promoting sustainable aviation fuels (SAFs) through the ReFuelEU Aviation proposal. SAFs include low-emissions synthetic hydricabon fuels such as those produced from air-captured CO₂ and hydrogen. 
• In the United Kingdom, in October 2021 the government set out a Net Zero Strategy aimed at achieving net zero emissions by 2050. It identifies the need for around 80 Mt of CO₂ removal by 2050 using DAC and bioenergy with carbon capture (BECC) technologies. Moreover, the latest Spring Budget (announced in March 2023) included funding of up to GBP 20 billion (around USD 25 billion) for CCUS applications, including DAC.  
  

Around 60% of announced DAC capacity for 2030 (currently in early development stages) has not yet been linked to a specific location, with project developers awaiting favourable regulations before finalising their expansion plans. In November 2022, 1PointFive and Carbon Engineering announced plans to deploy 100 large-scale DAC facilities (each with a capture capacity of up to 1 Mt per year) by 2035, at least 30 of which are expected to be deployed within the United States, owing to the IRA’s recent increase to the 45Q tax credit. Other regions likely to host some of these facilities include Europe, the Middle East (which has recently shown interest in DAC) and East Asia.  

Support for DAC has come from programmes such as X-Prize (offering up to USD 100 million for as many as 4 promising carbon removal proposals, including DAC) and Breakthrough Energy’s Catalyst programme (which raises money from philanthropists, governments and companies to invest in critical decarbonisation technologies, including DAC). Additionally, in April 2022 Lowercarbon Capital Fund announced its intention to invest USD 350 million in start-ups developing technology-based CDR solutions. Private investment rounds have also been successful: in 2022 Climeworks raised the largest-ever DAC investment, equivalent to USD 650 million. 

The development of agreed methodologies and accounting frameworks based on life cycle assessment (LCA) for DAC – alongside other CDR approaches – will be important to support its inclusion in regulated carbon markets and national inventories, and to serve as a tool to assess the benefits of subsidy schemes for DAC. Notably, the latest IPCC Guidelines for National Greenhouse Gas Inventories do not include an accounting methodology for DAC, meaning that CDR associated with DAC cannot be counted towards meeting international mitigation targets under the United Nations Framework Convention on Climate Change (UNFCCC).  

Efforts to develop carbon removal certification, including for DAC-based CDR, have commenced in Europe, the United States and Canada, as well as through initiatives such as the Mission Innovation CDR Mission and the UNFCCC Article 6.4 Supervisory Body. These efforts should be co-ordinated, with the aim of establishing internationally consistent approaches. 

The CDR field would also benefit from leading juristictions acting on transboundary projects, where financing, demand, and/or fabrication come from one jurisdiction but the facility is hosted in another jurisdiction. It is anticipated that in the future we will need a globally integrated industry for CDR, similar to that which exists today for energy, and a few early transboundary efforts would foster this development. 

The market for DAC-based CO₂ removal is expanding substantially. These carbon removal services are offered exclusively through the voluntary carbon market and are being purchased mostly by single companies (including Airbus, Shopify, Swiss Re, Microsoft, UBS) or demand aggregators such as Frontier (which committed to buy USD 1 billion of permanent carbon removals, including from DACS) and Next Gen (who recently purchased CDR credits with the goal of reaching over one million CDRs by 2025, including but not exclusively from DACS) to meet their own climate targets.  

The popularity of these DAC-based carbon removal services stems mainly from their very high removal potential when associated with geological storage. Most of them are currently oversubscribed due to the very limited installed operating capacity available at present, despite the high price compared to other CDR solutions on the market (the price of the subscription varies, depending on the amount of removal purchased, from USD 600/t CO₂ to USD 1 000/t CO₂). 

Some private organisations have recently started working on certification initiatives for DAC-based CDR, with examples including: 

• Gold Standard, who opened a consultation on operationalising and scaling the voluntary carbon market in 2020 and is expected to release a full methodology over the next couple of years. Gold Standard also released a methodology on CO₂ storage in recycled concrete, mentioning DAC as an eligible CO₂ source. 
• The CCS+ Initiative, which is developing various methodologies for CCUS more broadly but also on DAC more specifically under Verra’s Verified Carbon Standard (VCS). 
• Climeworks, which has developed a methodology to measure the net emissions removed from the atmosphere after adjusting for emissions resulting from plant construction, operation, and disposal (in compliance with ISO 14064-2 Standards). 
• Puro.earth, who has developed a series of CO₂ Removal Certificates (CORCs), including one on geologically removed carbon from DACS and BECCS. 
  

• Adam Baylin-Stern, Carbon Engineering 
• Geoff Holmes, Carbon Engineering 
• Jasmin Kemper, IEAGHG 
• Patricia Loria, CarbonCapture 
• Miles Sakwa-Novak, Global Thermostat 
• Louis Uzor, Climeworks