Catching emissions

April 4, 2022


As this year’s UN Climate Change Conference of Parties event in Sharm El-Sheikh approaches, Egypt wants to display leadership in combating climate change and lowering emissions in Africa. “The most important action or activity that everybody should work on diligently is CCUS [carbon capture usage and storage]. It’s very important … for [combating] climate change,” Tarek El Molla, minister of petroleum and mineral resources, told CNBC in November.

The United States is the undisputed global leader in developing and implementing carbon capture projects. According to the International Energy Agency (IEA), as of November, the U.S. had more projects using carbon capture storage (CCS) and CCUS than the rest of the world combined.

Many view CCS and CCUS as “silver bullets” that immediately lower a company’s harmful emissions while maintaining its business model. “Carbon capture on power plants looks as big as solar or wind. It’s bigger than nuclear in most of these models,” said Julio Friedmann, a senior research scholar at the Center on Global Energy Policy at Columbia University. In January, Collin O’Mara, president and CEO of the National Wildlife Federation, told the media: “There is no solution to get to net-zero without carbon capture technology.”

Yet, extracting carbon dioxide from the air requires considerable electricity, building infrastructure from scratch, and government incentives to make it financially feasible. Some worry overreliance on it would be detrimental to achieving the ultimate goal of net-zero emissions by 2050, necessary to keep global warming under 1.5 degrees Celsius. “There is a limited amount of money,” Shannon Fisk, managing attorney of the coal program at Earthjustice, told CBS News in January. “Spending several billion on pilot projects to capture carbon emissions means not spending that money on building out solar and wind farms, and power transmission lines.”

Governments must effectively delineate CCS’s role in their plans to reduce emissions. In January, John Noell, a senior climate campaigner at Greenpeace, told CBS News that any scenario that significantly decreases emissions would see “carbon capture on the margins.” Noel stressed the primary goal is to stop emitting carbon dioxide, not increasingly depend on a technology to contain it.

Capturing carbon

Separating carbon dioxide from the air is not a new concept, with the technology dating to 1972 in the United States. “Facilities have been operating since the 1970s and 1980s when natural gas processing plants in south Texas began capturing carbon dioxide,” said Sam Meredith, a London-based CNBC correspondent, in July. He explained that, in the early days, highly polluting oil producers would convert those captured emissions to liquid and use them instead of water to recover oil from underground reservoirs.

Fifty years on, CCS and CCUS have benefited from significant technological advancements that increased effectiveness. And now, pressure from governments, environmentalists, and civil society is mounting to ensure that all polluting companies linked to CCS and CCUS are eco-friendly. The International Energy Agency classifies the oil and gas, cement, and steel industries as “high polluting,” along with fossil-fuel-powered plants.

There are currently two distinct processes. The first is carbon capture, where harmful emissions are separated from exhaust produced by manufacturers. Some of those harmful emissions are not related to fuel. “Sixty percent of the carbon emissions from a cement plant [for example] have nothing to do with how the plant is heated up,” noted Columbia University’s Friedmann. “It’s entirely chemistry that converts raw materials into cement.” He explained that such pollution is a byproduct of chemical compounds used in cement or fertilizers, making its decarbonization near impossible. Meredith estimated nearly a third of global carbon emissions are from industrial processes.

CCS works for heavy polluting energy-intensive industries that can’t rely solely on clean energy to power their facilities or can’t reduce emissions below a particular threshold.

The other technology is carbon removal, where devices are placed in open spaces to filter carbon dioxide and other harmful emissions from ambient air. This type of device, essentially an artificial tree, captures 1,000 times more carbon dioxide than actual trees, according to Klaus Lackner, founder and director of the Center for Negative Carbon Emissions at Arizona State University, which developed it.

In both cases, selecting a zero-emission power source to separate carbon dioxide is vital and could prove expensive. “It’s… energy intensive,” noted a 2019 report by the American Society of Mechanical Engineers (ASME). “If that energy comes from fossil-fueled power plants, then the whole process threatens to be counterproductive.”

Another issue is what to do with captured carbon. That is a “bigger challenge than capturing carbon,” wrote Irina Ivanova, a Data reporter at CBS MoneyWatch in January. Most governments and companies build deep underground storage facilities to prevent emissions from leaking into the air.

The other option is to sell it to industries that need carbon dioxide in their manufacturing processes. “The vast majority of [captured] carbon in [the U.S.], something like 96%, is sold back to oil companies to help them capture more oil,” said Noel of Greenpeace.

Local strategy

In 2009, the World Bank commissioned a consortium consisting of Environmental Resources Management, a global sustainability consultancy; Carbon Counts, a U.K.-based environment consultancy; and Environics, a Cairo-based specialized consultancy, to “carry out a study for the assessment of CCS potential and capacity building in Egypt.”

However, very little came from the consortium’s work, as the government never announced a carbon capture strategy. The first CCUS cooperation protocol was signed in September 2021 between EGAS and Egyptian Petrochemicals Holding Co. and Toyota Tshusho Corp., Toyota Group’s trading arm. Under the agreement, Toyota Tshusho will supply CCUS equipment to yet-to-be-built facilities that will produce blue hydrogen.

In November, the government announced it would reveal CCUS plans with Italian energy firm Eni during this year’s Conference of the Parties. At the time, CEO Claudio Descalzi said if Eni signs a cooperation agreement with the government, the first CCUS project in Egypt will use the same technologies the Italian giant developed for the U.K. That would mean capturing and storing up to 10 million tons of industrial carbon dioxide annually.

Only a handful of dealers in Egypt, such as Atlas Copco, supply imported CCS and CCUS equipment to local manufacturers. According to Atlas Copco’s website, clients use the removed carbon dioxide to produce carbonated beverages, decaffeinated coffee and fast-frozen food. It also is used in agriculture, pesticides and fertilizer, industrial welding, methanol and urea production, mold hardening, oil extraction, paint removal and respiratory equipment testing.

In the MENA region, Egypt lags behind the GCC, which has the Kingdom of Saudi Arabia Technology Innovation Center on Carbon Capture and Sequestration. Saudi Aramco, the world’s largest oil producer, has an in-house CCS R&D division. Meanwhile, Qatar has the Qatar Carbonate and Carbon Storage Research Center, and Bahrain the Sitra Carbon Capture System. In 2016, the U.A.E.’s Masdar Institute and Abu Dhabi National Oil Co. launched the Middle East’s first joint venture for CCS and CCUS.

Regional R&D and investment in those technologies started in 2007 when Saudi King Abdullah pledged $300 million for a research program on the future of energy, the environment and climate change. Meanwhile, Qatar, Kuwait and the UAE have allocated $150 million to support CCS research.

How the U.S. does it

Egypt has a significant opportunity by partnering with the United States, and implementing CCS and CCUS solutions across all the sectors of its diverse economy. “The U.S. has a larger than ever a number of carbon capture projects either in the proposal or construction phases, or already operating,” noted a June report by ASME. The IEA estimated in December that the United States accounts for 40.5% of the world’s CCUS projects under development.

U.S. plants that use CCS and CCUS solutions are mostly fossil-fuel-powered plants and ethanol producers. However, other industries include cement, steel, hydrogen, petrochemicals, ammonia, and chemical plants. The captured carbon is stored or sold to different industries that need carbon dioxide.

However, the technology is not yet widespread, as only 418 industrial and power plants out of the 6,500 that use CCS and CCUS have made the process cost-effective. Moreover, those facilities aren’t high polluters, producing 358 million metric tons of carbon dioxide compared to 2,500 million tons produced by the remaining 6,500 facilities.

The federal government has several policy incentives to make CCS and CCUS more financially feasible. “There is no obvious point at which the technology becomes cheap and suddenly gets deployed without policy nudges,” said Friedmann of Columbia University.

In March, the U.S. Department of Energy allocated $24 million to research such technologies. Additionally, companies that implement CCS and CCUS solutions benefit from tax credits starting at $35 per tonne of captured carbon dioxide sold to other companies and $50 per tonne if stored at a certified facility for at least 100 years. “These tax credits could unlock many lower-cost industry and fuel transformation CCUS opportunities, particularly in natural gas processing, refining, and ammonia and bioethanol production,” said the IEA.

There also are favorable policies at the state level. The California Low Carbon Fuel Standard, for example, extends a tax credit equal to the federal tax break to the transportation of fuel produced in facilities that use CCUS technologies. Additionally, local and foreign companies operating in the state that store their captured carbon for at least 100 years inside or outside the country could qualify for that carbon credit program. Finally, the California law gives local establishments up to $200 per captured tonne of carbon dioxide in state tax credits above the Federal program.

The IEA paper noted these incentives could “more than double U.S. industrial CCUS capacity and nearly double global industrial CCUS capacity.”

Choosing wisely

Governments and companies must navigate several obstacles for CCS and CCUS to reduce emissions effectively. For one, these projects are generally massive. In January, Holly Krutka, executive director of the School of Energy Resources at the University of Wyoming, told CBS News that CCS and CCUS technologies are still new and expensive. Accordingly, they require significant public and private investment, similar to the early days of wind and solar energy. However, CCS and CCUS lack a significant benefit that renewables had when they first emerged. “You could invest a few million dollars and build a small solar farm. But you really can’t do that with carbon capture. So they have to be big projects,” said Krutka.

A report from the U.S. Government Accountability Office in December found “more than $1 billion in public funds for carbon capture projects resulted in few working projects and no power plants with carbon capture currently in operation.”

Governments should act fast to install CCS and CCUS solutions at polluting factories and not wait to separate carbon dioxide from ambient air. “Once carbon is in the atmosphere, we have fewer [feasible and affordable] solutions for removing it,” Matt Lucas, the associate director of Carbon180, a U.S.-based not-for-profit organization, told ASME in 2019.

Ultimately, policymakers must recognize that carbon capture technologies are short-term solutions. “Pitting one technology against another, i.e., wind versus nuclear versus CCS, misses the fact that all these are needed,” said Krutka.

Governments also should exercise restraint and a balanced vision regarding CCS and CCUS. Daniel Sanches, a Congressional Science and Engineering Fellow, told ASME in May 2019 those solutions would “simply slow the rate of emissions,” which is not what governments and companies agreed to do by 2050.

Center for International Environmental Law (CIEL) CEO Carol Muffett worries CCS and CCUS could become the endgame for emerging economies, particularly those that rely heavily on oil and gas and other high-polluting industries. “The unproven scalability of CCS technologies and their prohibitive costs mean they cannot play any significant [long-term] role in the rapid reduction of global emissions,” she said. “CCS is not a solution to confronting the world’s climate challenge.”

Nevertheless, Samantha McCulloch, head of CCUS technology at the IEA, is optimistic. “The encouraging news is … there has been significant momentum behind the technology in recent years, and this is really reflecting that without CCUS, it will be very difficult — if not impossible — to meet net-zero goals.”