The world is increasingly looking to governments, climate experts, and the energy industry to lay out decisive plans and commitments for keeping global warming well below 2°C and preferably to a max of 1.5°C (compared to pre-industrial levels). In essence, a chance to take stock of what they recommend packing for our collective journey up the seemingly unconquerable mountain that is the climate challenge.
Among other necessary steps such as greater energy efficiency and wider adoption of renewables, a net-zero future also entails carbon capture, utilization, and sequestration (CCUS). This, closely coupled with low-carbon hydrogen production, is of paramount importance when it comes to achieving our net-zero targets, particularly when addressing hard-to-abate industries.
"CCUS is no longer an option but a necessity,” says the International Energy Agency.
To put into perspective the scale of what is required, the International Energy Agency (IEA) says we need to increase the total amount of CO2 captured globally per annum from the 40 Mt that it is today to 7,600 Mt in order to achieve its net-zero emissions (NZE) scenario by 2050. That’s 190 times the size of the current global capacity—quite a sheer face on the steep path to 1.5°C.
So, when CCUS is described as “no longer an option but a necessity,” it begs the question: How can the world possibly scale CCUS activity to the levels necessary to achieve these lofty ambitions?
Much like the broader climate challenge that the world faces, it’s fair to say there is no single, silver bullet. However, some fundamental areas can go a long way in helping us achieve this.
1. Minimize costs
Due to the cost-marginal nature of CCUS projects, reducing costs is imperative. Technological advancements will play a role, together with hubs facilitating greater economies of scale by connecting multiple emitters to share in both risk and opportunity. Further reductions can not only be made by optimizing infrastructure at the asset level, but also through intelligent optimization (enabled by automation and machine learning) of the entire portfolio value chain.
2. Carbon policy and incentives
Today, carbon capture demand is largely driven by policy. While carbon pricing can help drive emissions reduction, it alone is not enough to encourage the adoption of CCUS over other methods of carbon abatement. Government policy is necessary to accelerate CCUS deployment, with incentives unlocking prospective investment.
3. Low-carbon hydrogen
New markets for decarbonized hydrogen products further incentivize the scaling up of CCUS projects. We need the ability to store energy at scale to offset periods of lower energy output from renewable sources (e.g., when the wind isn’t blowing or the sun isn’t shining). While energy storage and discharge at both industrial and commercial levels have been advancing, hydrogen as an energy carrier can be a game-changing clean fuel.
Blue hydrogen—part of what is considered ‘low-carbon hydrogen’—is one example. Conventional hydrogen production is based on steam reforming, a process by which hydrogen is extracted from natural gas. This is the most cost-effective way to produce hydrogen, but it has one main problem: it leaves a substantial carbon dioxide (CO2) footprint. Combining hydrogen production with CCUS, however, offsets the emissions of the process to create what is called blue hydrogen. An obstacle there is that, as mentioned earlier, capturing CO2 from hydrogen production is typically an expensive and energy-demanding process involving multiple steps.
Today’s tech greatly reduces the steps and cost of producing the low-carbon hydrogen heavy industries need to make a difference.
There is a solution to this economic challenge, and it’s found in innovative tech that captures carbon directly from the gas reforming unit. It's simple: input natural gas and steam, output pure hydrogen and CO2. By reducing the number of steps in the process, this tech reduces the cost of producing blue hydrogen. Not to mention that the resulting CO2 can then be pumped directly into carbon storage facilities or used as further input for industries that require high-quality CO2.
Thanks to the roles hydrogen can play in heavy industries such as iron, steel, chemicals, and cement—along with hydrogen-based fuels for aviation and shipping—both the demand and supply of low-carbon hydrogen are anticipated to grow rapidly, more than 50 times today’s levels in the NZE. Many projects for scaling blue hydrogen and CCUS to support the decarbonization of major industrial hubs have already been announced and are serving as blueprints for future hydrogen production hubs around the world.
4. Partnerships
As I alluded to already, much of the opportunities in the previous points can only be realized through coordinated international collaboration. This requires cross-industry partnerships that bring together emitters with technology and service providers, thereby breaking in to the most difficult-to-abate sectors. Partnerships built on the guiding principles of lower costs, speed, and uncompromising quality will be pivotal in accelerating the CCUS market.
We are in a decisive decade and need to scale solutions today if we wish to avoid the worst of climate impacts on our society and global ecosystem. Both CCUS and low-carbon hydrogen are well-tested and rapidly scalable solutions that can deliver decarbonized industries at a lower cost.
Progress to-date has been slow, but it’s looking up. The energy industry stands collectively at the foot of the mountain supporting world leaders as they put on their rucksacks and begin to climb.
