Key CCUS Insights from the Carbon Capture Technology Expo North America
Major players in the carbon capture, utilization, and storage (CCUS) sector gathered in Houston, Texas, in late June for the 2024 Carbon Capture Technology Expo North America. The event, co-located with the Hydrogen Technology Expo, drew over 8,000 attendees and featured 400 exhibitors, including IDTechEx. To complement IDTechEx’s CCUS portfolio, presentations and exhibition booths relating to carbon capture technologies, carbon dioxide removal, and the utilization of captured carbon dioxide were attended. IDTechEx analyzes three crucial CCUS insights from the event.
1. The World’s Largest Direct Air Capture Facility Won’t be Used for Fossil Fuels
During a presentation at the Expo, Robert Zeller, Vice President of Technology at Oxy Low Carbon Ventures, revealed that the CO2 captured by Stratos – Occidental Petroleum’s large-scale direct air capture (DAC) facility – will not be used for fossil fuel extraction. Instead, Occidental stated that consumer demand is focused on dedicated geological storage of carbon dioxide.
Carbon capture has long been associated with enhanced oil recovery (EOR), a process of injecting CO2 into depleted oil reservoirs to stimulate production. For many decades, EOR was the only economically viable CCUS business model. About 75% of all captured carbon dioxide today is used for this purpose. EOR has facilitated the growth of CO2 pipeline infrastructure and geological storage expertise while also enabling the production of oil with a lower carbon footprint. The strong ties to fossil fuels have made CCUS and DAC controversial for some environmentalists.
Occidental’s plan towards geological CO2 sequestration without EOR, instead generating revenue from voluntary carbon removal credits, indicates that future CCUS business models will no longer depend on fossil fuels. IDTechEx projects that dedicated geological storage will surpass EOR as the primary destination for captured carbon dioxide by 2030.
Direct air capture is experiencing significant advancements, with Climeworks’ Mammoth facility starting operations in May 2024. This facility, currently the largest DAC plant, can remove 36,000 tonnes of CO2 from the atmosphere annually. However, Stratos is scheduled to launch in 2025. Stratos will substantially increase direct air capture capacity—capturing and permanently storing 500,000 tonnes of CO2 per year. The solvent-based DAC approach, developed by Carbon Engineering (acquired by Occidental in 2023 for US$1.1 billion), will be used. Stratos won’t rely on fossil fuels for operation.
Occidental intends to build new clean energy infrastructure alongside all its future DAC projects. A solar farm is currently being built for Stratos through an agreement with Origis Energy. Zeller also expressed Occidental’s interest in nuclear fusion technology for this purpose after the technology reaches maturity.
2. Carbon Capture Technologies are Essential for the Development of a Hydrogen Economy
The co-location of the Carbon Capture Technology Expo and Hydrogen Technology Expo reflects their close relationship. Approximately 100 megatonnes of hydrogen will be produced from fossil fuels this year. By retrofitting current facilities with CCUS technologies, or designing greenfield facilities that incorporate carbon capture, CO2 capture technologies could play a vital role in scaling up the hydrogen economy. Blue hydrogen is the term for hydrogen produced in this manner.
Presentations from Mitsubishi Heavy Industries, Air Liquide, and Honeywell UOP highlighted the wide array of carbon capture technologies suitable for mega-scale blue hydrogen production. The choice of technology depends on factors such as the hydrogen production technology (commonly steam methane reforming, autothermal reforming, or partial oxidation), the flue gas impurities, solvent management restrictions, and space requirements. Amine solvent-based technologies were frequently discussed because of the maturity of this approach, as were cryogenic technologies due to the relatively high CO2 purity in the flue gas stream.
Green hydrogen production (hydrogen created via electrolysis of water powered by renewables) is a more sustainable long-term option than blue hydrogen production. However, large-scale green hydrogen projects are expected to remain expensive until the mid-2030s. Blue hydrogen production, on the other hand, uses mature, readily available technologies. It can be seen as a complementary and transitional solution to green hydrogen. It enables the formation of new hydrogen supply chains and infrastructure as the costs of electrolyzers decrease and renewable electricity becomes more widely accessible. In a decarbonized future, demand for blue hydrogen production could be substantial. Nonetheless, questions remain around blue hydrogen. The economic incentives for blue hydrogen projects are uncertain in some regions. Faster action is needed to stimulate demand for low-emission hydrogen to unlock investment.
3. Fuels Made from CO2 are Seeing Demand from the Aviation and Shipping Sectors
Since battery technologies’ energy densities are too low for complete electrification of the aviation and maritime industries, sustainable fuels offer the most viable decarbonization strategy. Fuels made with captured CO2 and low-carbon hydrogen represent a promising approach. In the past, alternative fuels have struggled to compete due to an inability to achieve cost parity with fossil fuels. However, regulations will soon drive increasing demand for such fuels, including CO2-derived ones. For example, the European Union adopted the ReFuelEU Aviation Regulation in 2023, mandating a 70% sustainable aviation fuel blending obligation by 2050. The EU ETS was extended to the maritime sector in 2024 and now covers CO2 emissions from all large ships. Continuous regulatory pressure over the next several decades will provide significant opportunities for CO2-derived fuels once the technologies are proven at scale.
Many alternative fuels will be required for net zero, but there is currently a significant supply gap. As Jenna Pike, senior scientist at OxEon Energy, stated in her Expo presentation, the ability to deliver at the large scales required, not the market size, is the constraint facing CO2-derived fuels. Current challenges include difficulties in sourcing and transporting captured CO2 and the high costs associated with low-carbon hydrogen.
Approaches to Decarbonization Must be Practical
Meaningful decarbonization can only occur if transitionary technologies are adopted. Some criticize CCUS for prolonging the use of fossil-fuel-based industrial emissions. However, while these concerns are valid, the transition to greener alternatives will not happen quickly. CCUS can decarbonize current assets while green infrastructure is developed. Approaches to decarbonization must be practical, remembering that the best should not be the enemy of the good.
