CCS has long been recognized as necessary to address climate change, yet its scale-up has been lagging. A new report by the Global CCS Institute on the global status of CCS in 2019 shows that the tide is turning. The next wave of CCS facilities is well underway, with U.S. paving the way for the deployment of several new innovative CCS projects.
There are now 19 large-scale CCS in operation globally, four under construction, and 28 in various stages of development. The facilities pipeline has replenished over the past 24 months, with close to 100 million tonnes of CO2 annual capture capacity.
The U.S., already home to 10 large-scale facilities capturing more than 25 mtpa of CO2, is the global leader on CCS deployment. The Global CCS Institute recently added 10 facilities to its database, eight of which are in the U.S., and were driven by sustained government support. Notably by the 45Q tax credit — the most progressive CCS specific incentive globally — and further supportive mechanisms on the state level.
The U.S. Department of Energy also selected nine facilities for Front-End Engineering Design (FEED) study support. Industry sources say that more than two dozen facilities could potentially be announced once the Internal Revenue Service finalizes the guidance and rule for the 45Q tax credit.
The U.S. facilities exemplify essential trends of the next wave of CCS. These include hubs and clusters, natural gas power generation with CCS, and direct air capture. The next wave of CCS facilities is being built, in part, as hubs and clusters linking multiple sources of CO2 to shared infrastructure to transport and store CO2.
Taking advantage of clustered power and industrial facilities, these projects significantly reduce the unit cost of CO2 storage through economies of scale. Allowing each project to focus on its core strengths also reduces risk.
The Department of Energy’s Carbon Storage Assurance Facility Enterprise Initiative — also known as CarbonSAFE — which focuses on developing geologic storage for 50 million tonnes and more, is already showing the first signs of success. In the U.S., six of the eight facilities added to the Global CCS Institute’s database are part of the program.
Earlier this year, an ammonia plant with near-zero CO2 emissions using a repurposed integrated gasification combined cycle (IGCC) plant with CCS was announced in Indiana. The facility is expected to capture 1.5 to 1.75 Mtpa CO2 for dedicated geological storage in the Wabash CarbonSAFE CO2 storage hub. The project also benefits from 45Q.
To achieve net-zero, mitigating emissions will not be sufficient. Removing CO2 from the atmosphere will be needed, and the deployment of negative emissions technologies is gaining traction.
California, through its Low Carbon Fuel Standard CCS Protocol, which took effect earlier this year, is incentivizing direct air capture facilities globally. Driven by this policy, Occidental Petroleum announced the first large-scale direct air capture facility in Texas, aiming to capture more than one mtpa of CO2 from the atmosphere.
Innovators are also working on the next generation of technologies. The Allam Cycle aims to be cost-competitive with conventional combined-cycle natural gas plants while also capturing 99 percent of CO2. Several of the facilities selected within DOE’s FEED-study support include retrofitting natural gas-fired power plants with CCS. With natural gas being the fastest-growing fuel in 2018, and not a single natural gas power plant equipped with CCS globally, this is a welcome development.
CCS deployment in the U.S. is underpinned by policy action both on the federal and state level. In addition to 45Q and the LCFS CCS Protocol, several other policy initiatives are underway. In Congress, multiple CCS-supportive bills have been introduced, including proposing important additional financing mechanisms and catalyzing CO2 infrastructure development.
In California, CCS is being put forward as an essential technology to support the state’s decarbonization goals in all three sectors of emissions. Several states, including Montana, Louisiana, Texas, and North Dakota, provide tax incentives for CCS deployment, while others like Wyoming are aiming to progress on the technology substantially.
The tide has turned, the next wave of CCS facilities is now well underway. Yet we cannot afford to rest on these positive developments. The International Energy Agency recently updated its Sustainable Development Scenario. CCS now provides nine percent of cumulative emissions reduction through 2050. It shows that more than 2000 facilities need to be operation by 2040. Reaching climate goals means an urgent scale-up of at least 100-fold.
With 2019 going down in history as one of the hottest years on earth, CCS deployment in the 2020s is more urgent than ever.
