CO2-made fuels, products could be $800B market — report
Captured carbon dioxide could make a slew of products worth hundreds of billions of dollars and reduce greenhouse gas emissions dramatically in the process, according to a new report from the Center for Climate and Energy Solutions, or C2ES.
Taking CO2 and using it for products and services is known as carbon capture and utilization, or CCU. Unlike carbon capture and storage (CCS), where the gas is buried, CCU aims to repurpose the greenhouse gas for carbon-based products.
The paper does not focus on enhanced oil recovery (EOR), where CO2 is deployed to recover hard-to-reach oil, but instead examines non-oil products, including many used in the energy sector like concrete, chemicals, fuels and fertilizers. Non-EOR carbon utilization has “significant potential” to contribute to greenhouse gas reduction over the coming decades, the report said.
The study, using numbers from the Global CO2 Initiative at the University of Michigan, identifies market potential for a variety of sectors.
“Funding, incentives and prompt strategic action are necessary to move the CBPI [carbon-based products industry] to its full potential … [at which] CBPI could reach or exceed US $800 billion by 2030,” according to one statistic cited in the report.
Concrete is forecasted to be the largest CCU sector in terms of market value at $400 billion by 2030. The global market for concrete is expected to reach 40 billion tons by then, the report said, with a potential mitigation of 1.4 billion metric tons of CO2 by 2030 in that sector alone.
The market size for fuels is slated to reach $250 billion by 2030, according to a report table, but its forecasted mitigation of CO2 is projected to surpass concrete at 2.1 billion metric tons.
Jeffrey Bobeck, director of energy policy engagement at C2ES and a report author, said that if supportive policies are put in place, within 10 years there could be significant growth in the industry.
“We do know that if they don’t reach this kind of level within the foreseeable future, which is 2030, they probably aren’t going to have enough of an engine of growth to reach a significant level by 2050,” he said.
Bobeck said CCU is meant to complement CCS and that the greatest expression of that is that the utilization was included in the expansion of the 45Q carbon storage tax credit last year.
Report authors outlined a number of actions in order to achieve a real capacity for greenhouse gas reduction, including both immediate, near-term and long-term actions. At the federal level, that would include the USE IT Act, or H.R. 1166; reauthorization of the Department of Energy’s fossil energy research program; and national legislation that would prioritize building a CO2 pipeline network.
Still, it’s unclear at this stage whether the carbon utilization sectors can develop fast enough to realize the desired environmental impact, researchers said.
Across each sector, technology and commercial readiness differs so much that there’s no “silver bullet” when it comes to policy reforms, the report found.
“Rather, a portfolio of policies is needed to address technology development, financing, and market preferences,” the report said. “Federal action alone is not sufficient. States and local governments may be in the best position to tailor policies that address their specific circumstances.”
While many see CCU as essential to decarbonization, Lukas Ross — a senior policy analyst with Friends of the Earth — said that carbon capture primarily serves a political purpose by providing cover for moderates and the fossil fuel industry.
“If you want to talk about carbon fixing technologies environmentalists ought to be endorsing, trees and sustainable agriculture are our best bets,” Ross said.
Ross said that if Earth is on this “terrifying 2030 timeline,” looking to “miracle technologies” like retrofitting coal plants or direct air capture is actually making ourselves feel better about doing nothing now. Putting out these possibilities allows people to avoid hard questions about confronting the fossil fuel industry, Ross said.
Nevertheless, Bobeck — the C2ES report co-author — said that CCU is absolutely essential to combatting climate change.
“Maybe it’s a transitional tool, but the idea of reducing greenhouse gases faster, getting at those emissions, in addition to supporting growth in renewables, it’s basically an all-of-the-above, all tools in the toolbox approach,” Bobeck said.
Perhaps there’s a future where carbon capture isn’t needed, Bobeck said.
“But in the interim, you’ll get there faster if you start to capture emissions from fossil fuels, rather than trying to dream them away,” he said.