Advancing carbon capture, utilisation, and storage on path to net zero

 

By Carly Fields
 

In the global pursuit of net zero emissions by 2050, carbon capture, utilisation, and storage (CCUS) has the potential to play a crucial role in the transition to a sustainable future.

According to Mathilde Fajardy and Carl Greenfield, energy analysts at the International Energy Agency (IEA), CCUS could capture and store approximately 1 billion tonnes of carbon dioxide (CO2) annually by 2030 under the IEA’s Net Zero Emissions by 2050 (NZE) Scenario – which lays out a pathway for the energy sector that aligns with the Paris Agreement goal of limiting global warming to 1.5 °C.

However, while a recent surge in project announcements, final investment decisions (FIDs), and plant commissioning underscores a growing momentum, gaps remain in translating announcements into operational reality. “In 2023, around 10 capture facilities entered operation and almost 20 projects reached a final investment decision. But capacity that is either already in operation or has reached FID still accounts for just 20% of announced capture capacity for 2030. For storage, this drops to around 15%,” said the IEA analysts. 

But capacity that is either already in operation or has reached FID still accounts for just 20% of announced capture capacity for 2030. For storage, this drops to around 15%

Amid renewed global recognition of CCUS’ potential, collaborative efforts have gained momentum. Initiatives like the Carbon Management Challenge and strategic policies from countries like Canada and the European Union underscore a collective commitment to CCUS advancement. “By the beginning of 2024, 19 countries and the European Commission had signed on to the Challenge, which aims to raise ambition by supporting a global goal of managing at least 1 billion tonnes, or 1 gigatonne (Gt), of CO2 annually by 2030, in line with the NZE Scenario. To date, CCUS commitments from the participants represent just under 15% of the 1 Gt goal,” said the IEA analysts.


Collaborations spur developments

Cross-border collaborations, exemplified by agreements between Denmark and France, signal a paradigm shift towards international co-operation in carbon management. Legislative interventions, such as the Infrastructure Investment and Jobs Act in the US, coupled with enhanced tax credits, have further catalysed project activities. Similarly, Europe's strategic policies and funding mechanisms have spurred project announcements, particularly in CO2 storage.

In Europe, CCS is listed as one of the key green shift technologies in the Net-Zero Industry Act of March 2023 and many projects have received innovation funding. The Global CCS Institute highlights a 48% increase in CO2 capture projects in 12 months from 2022 to 2023, which is a very positive indicator for the future, noted DNV. However, reaching FIDs depends greatly on the EU Emission Trading System carbon price trajectory and the potential for financial support from the likes of the EU Innovation Fund.

CCS isn’t a competitive solution at current carbon pricing

“CCS isn’t a competitive solution at current carbon pricing. But the price is expected to rise as the sum of allowances shrinks. Essentially, for CCS to be a commercially attractive option for decarbonisation the cost of capturing, transporting and storing CO2 must be lower than the carbon price,” said Mathias Sørhaug, business development director CO2 shipping at DNV Maritime.

While new policies have helped spark project announcements, “translating this interest into investments and operating projects takes time”, said the IEA. “Funding calls and grant negotiations mean there is an inevitable delay between the announcement of funding and when it is dispersed to a project, influencing when a project can eventually start operating.” For example, for the EU Innovation Fund, it typically takes more than a year from when a funding call is issued to when the grants are awarded.

“Time is short to ensure that CCUS can play its part in reaching net zero emissions by mid-century – and not only in advanced economies,” said the IEA. “Emerging markets cannot be left out of the renewed momentum around CCUS, and must have access to international resources and funding, since translating interest into actual CO2 emissions reduction takes time.”


Permitting and partnerships

The IEA analysts advise streamlining permitting processes, fostering partnerships, and expediting funding.

The IEA analysts advise streamlining permitting processes, fostering partnerships, and expediting funding. Governments must ensure swift and transparent permit approvals, while industry players should prioritise feasibility studies and early-stage investments.

Partnerships across industries and financial communities are also pivotal in navigating the complexities of CCUS project development. Early engagement with stakeholders, including local communities, fosters transparency and mitigates concerns, laying the groundwork for successful project implementation.

On the shipbuilding side, DNV has awarded a series of Approvals in Principles for ship/tank designs to different shipyards and designers. Transporting liquid CO2 at low pressure is recognised as the most cost-effective option for longer distances and volumes.

DNV is working with Shell, Equinor, Total and Gassco in a joint industry project called CETO (CO2 Efficient Transport via Ocean), which will soon finalise a technical qualification of a 30,000 cbm low-pressure ship design. Within the project, a detailed ship and cargo tank design has been developed to address the core challenges of large CO2 cargo tank designs including material testing, fatigue and cargo operation close to triple point.

“Given the high pressure, heavy cargo and low temperature, the core challenge is material strength, including fracture toughness and fatigue resistance. To reduce costs, we need a carbon-based steel with high strength properties and performance at low temperature,” Sørhaug said. Shipyards in Japan, China and Korea as well as steel mills are currently engaged in research to identify the appropriate material, added DNV.

“It’s an exciting time,” Sørhaug concluded. “Alongside DNV Energy Systems, we’re at the forefront of developing a recommended practice right along the CSS value chain, including spearheading an ISO Technical Report on CO2 shipping that will be finalised this summer.”