Climate change has been the topic on the lips of politicians, activists, and investors for the past few years.
The Paris Agreement of 2015 was a line in the sand, against which to measure the effort of nations to reduce their reliance on carbon in their economy.
More needs to be done
Some are doing better than others against their targets. For instance, the leaders are actually developing nations the Gambia, Morocco and India, which are all expected to fall short of their 1.5ºC limit.
The same cannot be said for Saudi Arabia, Russia and the United States – at least until the recent change of administration led to a change in policy. These nations have made very little effort to comply with targets that had been set.
Then there are others, like China, which is well on target, but towards targets that are now accepted to be wholly inadequate.
The UK set a very ambitious target earlier this year by legislating to have reduced emissions by 78% by 2035, compared to 1990 levels. Other nations will follow suit.
However, switching over to electric cars and sustainable packaging is not going to move the needle, when we are still so reliant on some fossil fuels to generate electricity and create products for our economy. So, it seems logical that if there's a way of removing carbon from the air, then that would have to be a good idea. And indeed it is. Though it's not a new one.
Carbon capture technology has been around for a number of decades but has never achieved much traction.
IEA data shows that between 2010 and 2017, levels of investment into CCU facilities around the world almost halved. Though there has been a sharp increase in investment since 2017, last year only reached the levels of 2013, though COVID-19 may have had a disruptive influence. As more economies look to reduce their reliance on carbon, that is set to change.
One of the obvious ways of pulling carbon out of the air is to grow more trees. The Trillion Trees initiative is a program that wants to protect and regrow one trillion trees around the world by 2050. Though forest expansion was part of the Paris Agreement commitments, there is a limit to how many trees one can plant.
A 2019 Swiss study estimated that there were only about three and a half million square miles of land – just under the size of the United States of America – with the potential to protect and regrow trees. This would increase global forestation by 25% and capture and store about one quarter of the carbon in the atmosphere, but only once the forests matured.
And while it would make a contribution, planting trees is not enough to curb global warming. Quite apart from the damage to local ecosystems and the strain on water supplies, it does nothing with the carbon left behind in the trees and the soil.
Finding a better way
There needs to be a more efficient method of pulling carbon out of the atmosphere and carbon capture and sequestration (CCS) seems the most likely method.
This requires us to consider CO2 as a waste product like any other pollutant. But the amount we need to be during by 2030 is huge – two to four times the volume of fluids the global oil and gas industry deals with today.
There are two problems with this, say the critics. The cost of carbon is negligible in real terms. It certainly does not force financial decisions to avoid punitive charges. This makes it difficult to justify investing in ways to imprison it.
The other problem is that it places too much control of the schedule in the hands of the oil and gas sector.
The biggest use of CCS is currently in the oil and gas industry in oil recovery, a means of extracting hard-to-reach and release up to 10% of the site output as they become exhausted.
The CO2 used by the industry comes from natural pockets of gas trapped under the earth rather than that captured from the atmosphere. Between 90% to 95% of the CO2 injected during this process is retained in the geology that previously held the oil and gas. But this still means we are digging up CO2 to only bury it again, when the environmental crisis is being driven by something that is literally hanging in the air.
Huge potential and big money
Switching to captured CO2 would contribute considerably to reducing emissions. But it still isn’t enough. Even if the right CO2 was buried, it would only reduce today’s carbon levels by 15%.
Analysts have estimated that by 2050, more than $1 billion will have been invested CCS. The opportunities this presents are almost endless and startups are popping up to take advantage of the funding.
A number of methods already exist to capture carbon from the air. An obvious use is from flue gases in the waste streams of power stations and other industrial processes. Here, the CO2 is highly concentrated – one molecule out of every 10 compared to one in 2,500 in ambient air.
Concentration levels require less energy and this will probably make carbon dioxide from flue gases cheaper than CO2 produced by other methods, such as direct air capture (DAC).
The advantage of DAC, though, is it can be placed anywhere, as CO2 is equally concentrated across the world. This reduces transportation costs, as it can be sited near manufacturing plants that make the units. It is also a smaller, modular, and more adaptable technology. Many believe it will be the most promising negative emissions technology over the long term, because it can be scaled up to any size.
Other major uses of CO2 are in greenhouses and for adding fizz to beverages. It can also be formed into materials and feedstocks for other processes, such as synthetic hydrocarbon fuels, polymers, chemicals, agriculture, and food and new materials such as carbon fibre, nanotubes, and graphene.
Some of these technologies are more developed and others, and it must be considered how long the carbon is retained or sequestered.
Only construction materials and materials like carbon fiber offer semi-permanent sequestration of CO2. Whereas the carbon used in fuels will be released as soon as it is burned.
Innovation and policymaking
Innovation in ways to make use, reducing emission and removing carbon from the atmosphere will will attract funding and are likely to be the boom businesses of the second half of the century.
New CCU technologies will likely involve a mixture of these, and some will only lock in the carbon for a short period, as in the manufacture of synthetic fuels.
If new processes are developed to synthesise them more easily and cheaply – or governments place punitive carbon charges on the use of extracted fuels – this could be the largest potential market for CO2. They could deliver extremely cheap, renewable energy.
However, to date very little development has gone into harnessing the potential of captured carbon, whether in existing CCS technology, or the development of new methods of forming polymers, chemicals or even growing algae for food.
These will all require considerable policy support, but . Fields an aggregate show enormous potential growth of 10 or 20 times if it is supported by government policy.
This all adds up to considerable growth for investors who see the bigger prize, but also in the GDP of nations, some of which may lack traditional resources.
With the concrete, fuels, aggregates, polymers and methanol markets estimated to be worth between $800 billion to $1.1 trillion by 2030, it’s not hard to see that the future for many businesses is going to be in carbon.