Decarbonisation Technology May 2025 Issue

the full scope of the challenge, especially in decarbonising the hard-to-abate sectors. Decarbonisation potential of CCUS projects CCUS has the scope to play a pivotal role in the latter sectors. It can be readily deployed at fossil fuel power plants and industrial facilities such as cement, iron and steel, and chemicals, where carbon dioxide (CO 2 ) can be captured and stored or used to create products such as fuels and chemicals (carbon capture and utilisation or CCU). CCUS can also provide a low-cost pathway for low-carbon hydrogen production, which can further contribute to the decarbonisation of the industry and transportation sector, or it can enable the removal of CO 2 , which is unavoidable or technically difficult to abate, directly from the atmosphere through direct air capture with storage (DACS) or bioenergy with CCS (BECCS). This technology is particularly relevant for the oil and gas industry, as it can help mitigate emissions from its operations and products. Although the adoption of CCS has lagged behind initial projections, there has been a substantial increase in activity and interest “ CCS is not a new technology, but the challenge lies in its economically large-scale deployment as investors face several uncertainties and risks ” Industrial clusters Industrial clusters or ‘decarbonisation hubs’ are gaining traction as one way of reducing uncertainty and de-risking investments in decarbonisation. The Wor l d Economic Forum reports that, to date, more than 33 industrial clusters across 16 different countries have joined their global Transitioning Industrial Clusters (TIC) initiative ( WEF, 2025 ). Industrial clusters are eminently suitable for energy-intensive industries considering investments in carbon capture, transport, and storage. Government involvement through funding or public-private partnerships is a common feature in such

in recent years. Across the globe, novel technologies are being piloted with the goal of driving down the cost of carbon capture for both the power generation and industrial sectors. In addition to chemical absorption and physical separation, which are currently the two most advanced capture technologies, other separation technologies are in development, including membranes and looping cycles. To meet net-zero targets, CCUS deployment must increase by several orders of magnitude within the next two to three decades. In the case of the US, it would mean a scale-up to as much as 100 times today’s levels, according to the US Department of Energy’s Office of Clean Energy Demonstrations (OCED) ( US Dept. of Energy, 2023 ). While an ever-increasing number of projects across the entire value chain are being announced, only a fraction of them can take a final investment decision. CCS is not a new technology, but the challenge lies in its economically large-scale deployment as investors face several uncertainties and risks. These risks can entail technology failures, cost overruns, extended timeframes, and high capital costs, among others. Another significant risk factor is the lack of clarity with respect to the demand outlook, which makes it challenging for investors to understand the scale of opportunity and, thus, for projects to reach a financial investment decision. Scaling up the infrastructure needed to transport and store captured carbon dioxide also requires the development of new clusters. Knowledge sharing is also considered to be a critical success factor. In many of the clusters, the oil and gas industry brings its experience in gas pipelines for the supply of hydrogen as well as expertise in carbon capture, transport, and suitable locations for permanent storage, for example in depleted oil and gas fields. The cooperation between the governments of the UK and Brazil is another good example of knowledge sharing to progress industrial decarbonisation. The aims of this cooperation include knowledge sharing and support in identifying and accessing international climate finance ( UK Gov, 2024 ).