• The CO₂ input is either essential in a production process which would in any case occur (urea production), or delivers value via increased production (enhanced oil recovery or EOR). The cost of utilisation is, in these cases, negative since the urea producers or EOR operators will pay for the CO₂ delivered, even if there is no carbon price. This applies to ~0.5 GtCO₂/year in 2050. However, the use of CCUS for EOR has played a major role in undermining public confidence in CCUS technologies as it raises moral hazard concerns around legitimising a ‘business as usual’ role of fossil fuels. In total, EOR should play only a very limited role, compatible with future global oil consumption of around 7 Mb/d. • CO₂ can be used as an input to form a new product. In the case of synthetic fuel (and also synthetic methane, methanol, or plastics), the captured CO₂ is used instead of fossil fuels to produce an economically valuable product, but the total production cost is higher than the conventionally produced product. As a result, a carbon price (or equivalent regulation) will be required to make CO₂ sequestration cost- competitive with fossil fuel inputs. The ETC analysis suggests that synthetic fuels, which combine captured CO₂ with low-carbon hydrogen, are likely to become a cost-effective option for the decarbonisation of aviation over the next 30 years, utilising around 0.8 GtCO₂/ year in 2050. A further 0.7 GtCO₂ per year is
likely to be required as an input to plastic and chemical production. • CO₂ has no economic value, and utilisation is essentially a form of storage. In the case of construction aggregates, CO₂ sequestration is not essential to the economic function or quality of the aggregates delivered. Therefore, ‘using’ CO₂ in construction aggregates is effectively another form of storage, and the relevant comparison is between the cost of achieving sequestration within aggregates versus the cost of transport and storage in geological formations. Aggregates are expected to utilise 0.4 GtCO₂/ year in 2050, although if the correct industrial residues used in the carbonisation process can be made available, this figure could be an order of magnitude higher. Blending CO₂ into cement could add a further 0.05 GtCO₂/year. Obstacles to CCUS scale-up so far Achieving the growth required in the 2020s would entail a dramatic change in trend after a decade in which the number of operating plants has grown at a glacial pace and many announced projects have been abandoned. CCUS was once viewed as having a prominent future role in power decarbonisation, but the falling costs of wind and solar have severely diminished its likely role in that sector. Conversely, the necessary role of CCUS in sectors such as cement has only become apparent over the last decade as industry and policymakers have focused on the need to
kgCO /bbl
CO source
Net emissions
Combustion Production Injection
Source
Recovery
Utilisation EOR Production Combustion
Oil
Fuel
CO
CO reservoir
300
100
400
500
-300
Mature
CO
CO via CCU
Point source capture
500+ utility
300
100
400
-300
New
CO
DACCS & low case CO ratio
CO
Low
0
100
400
200
-300
Emerging
CO CO
DACCS & high case CO ratio
High
0
100
400
-100
-600
Figure 4 Net CO₂ emissions from oil produced via EOR vary, according to where the CO₂ is sourced from and the ratio of CO₂ injected to oil recovered
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