In a report released last month, Lux Research looked into CO2 utilization. The company forecasts a growth in this sector to $ 70 billion by 2030 and to $ 550 billion by 2040. CO2 will be put to good use in the buildings, chemicals, materials, fuels, and food sectors.
A growth sector
In its report CO2 Capture & Utilization: The Emergence of a Carbon Economy, Lux Research predicts that in the short term, this growth will be driven by the building materials sector. ‘For example, CO2 can be used to produce aggregates to mix with cement or injected directly into wet concrete for curing,’ says Runeel Daliah, analyst at Lux Research and the lead author of the report. ‘Building materials will become the largest sector for CO2 utilization, capturing 86% of total market value by 2040. Technologies for CO2 utilization in the building industry have low technical barriers – adoption will only be impeded by regulatory constraints.’ On the other hand, in the fuels, chemicals, and carbon additives sector, CO2 utilization will only take off if supported by extensive innovation or regulatory support, say the report and its Executive Summary. And ‘the polymers and protein sectors will remain niche applications of CO2 utilization despite the expected success of the technology in these sectors.’
German nova-Institute is one of the companies that pay much attention to CO2 utilization. As they put it, ‘carbon capture and utilization technologies represent an essential contribution to a renewable carbon industry.’ Each year, they organize a conference on this subject. ‘The transition to direct CO2 utilization as one alternative carbon source is needed to substitute fossil resources and to shift towards sustainable and climate-friendly production, paving the path to a circular economy and counteracting climate change.’ And each year, there is a competition for the yearly ‘best CO2 utilization’. This year’s proposed six technologies include fuel and surfactant production, and dissociation of greenhouse gas oxides; in the latter technology, carbon is collected in water in the form of Buckminster Fullerenes (C60, C70, C80 and nano tubes) and other high value carbons.
CO2 utilization in practice
We posed some additional questions to the authors of the Lux report.
The main conclusion of the report is: ‘Low-carbon technologies require strong regulatory support for adoption – this is especially applicable to CO2 utilization which is at an early-stage with expensive costs & strong competition from alternate technologies.’ From a neoliberal point of view, this would seem a pretty damning conclusion. Do you judge climate policy to become strong enough to overcome this barrier?
‘Climate policy should not specifically favour the adoption of CO2 utilization, but rather the adoption of low-carbon technologies. When climate policies favour a specific technology, it unintentionally creates barriers for the adoption of novel and still-unproven technologies in the future. For e.g. the ethanol mandate in the U.S. is a prime example of it. Climate policies promoting the adoption of ethanol in the transportation sector did not foresee the rise of battery electric and fuel cell vehicles – as such, an entire ethanol industry that is propped up purely on regulations is now under threat of collapsing in the near-future due to novel technologies.’
‘Regulatory support for low-carbon technologies is still too week for adoption of CO2 utilization. The problem is that when comparing CO2 utilization to other technologies for decarbonization, CO2 utilization often ends up being the more expensive option. So if regulatory support is ever strengthened to the point of making CO2 utilization technologies economically feasible, other cheaper technologies would have already superseded it in a low-carbon world. Therefore, it important to identify areas where CO2 utilization is the most scalable technology for decarbonization, despite its high costs.’
Could you please elaborate what such a regulatory support would mean for the aviation fuel industry, the most important CO2 utilization market in the near future? What kind of regulation? Any subsidies? For how long?
‘The aviation sector is one of the applications where CO2 utilization is the most scalable technology for decarbonization. Amongst the options available to decarbonize aviation, biofuels and synthetic fuels made from CO2 are the only ones available. While biofuels are more developed and cheaper than synthetic fuels, the scale of adoption will be limited due to bio-feedstock supply constraints. With synthetic fuels, you only need CO2 and electricity as feedstock which are widely available, albeit expensive. This is, of course, assuming that battery technology and hydrogen technology will not evolve to such a point that they become credible options for decarbonizing aviation. While the long-term consensus is that they won’t, Airbus recently unveiled new concepts for hydrogen-powered planes post-2030. The aviation sector is hard to regulate due to the international nature of the industry. Offsetting emissions is the best approach, which means that any low-carbon project can be used for this purpose.’
Can you expand a little on the opportunities of CO2 utilization in building materials? How? How much? How does this compare to alternatives to cement that don’t emit CO2, or much less?
‘There are two approaches to using CO2 utilization in building materials. In the first approach, CO2 is reacted with a waste material to produce a carbonate ‘rock’, which is then used as an aggregate. In this approach, the carbonate aggregated is identical to conventional aggregates, which means the only advantage is the lower footprint. Given that CO2-based aggregates are more expensive than conventional aggregates, you need low-carbon incentives to even out the costs.’
‘The second approach is to use CO2 in curing applications. In this approach, CO2 is injected into wet concrete mix to form nano-scale calcium carbonate in the concrete as it dries down. On top of a lower carbon footprint, this approach also results in stronger concrete material as well as reduced consumption of cement in concrete making. Therefore, the cost of the CO2-based concrete is cheaper than conventional concrete, which means you do not need low-carbon incentives for sale onto the market.’
‘The main barrier to the adoption of CO2 utilization are regulatory barriers to the use of novel concrete products. The building industry is conservative and slow to adopt novel materials for safety reasons. A new concrete material such as CO2-cured concrete may take up to a decade before widespread approval in the building sector. An added complication is that regulations vary by locality, which means CO2-concrete companies repeatedly have to go through regulatory approval which slows down adoption.’
From your figures we can derive that CO2 utilization will remain below 1% of global CO2 emissions for quite some time. In view of this figure, do you judge it adequate to present CCU as a form of climate policy? Or would it have to stand on its own feet, as a commercial proposition?
‘Yes. Ultimately, it will be impossible for us to completely eliminate CO2 emissions from our energy system. To reach carbon neutrality, these CO2 emissions will have to be dealt with. While sequestrating CO2 is the preferred solution, it is not something that is available in all countries (Japan and Korea come to mind as countries with significant CO2 emissions but no geological resources for storage). Therefore, CO2 utilization will be needed to offset emissions that cannot be stored underground and should therefore be part of climate policy.’
Summing up, the prospects for CO2 utilization are bright in the construction sector – if this is willing to adopt this new technology. But even here, cement technologies that emit little CO2 could prove to be formidable competitors. In other markets, innovation will play a key role. That is to say: if we don’t want to rely on the prospect of regulation. Much work to be done!
Diederik van der Hoeven