Greenhouse gas removals: new technologies and new markets

International

“Keep 1.5 degrees alive” was a common slogan at COP26. The Glasgow Climate Pact which concluded the conference reaffirmed the goal, set in the Paris Agreement, to “pursue efforts to limit the temperature increase to 1.5°C above pre-industrial levels”.

But it now looks virtually impossible to achieve the 1.5°C target without significant greenhouse gas removals (GGRs) – often also referred to as carbon dioxide removal (CDR) or negative emissions technologies (NETs).

This has been a contentious topic for years. Opponents argue that deploying carbon removal technology reduces the incentive for nations to cut their carbon emissions. There are also concerns about whether the technology can be sufficiently effective at the scale required. Nevertheless, it is now increasingly accepted that – given the progress made so far in climate change mitigation – some form of GGR will be needed.

The UK, for example, has set 2050 as its date for achieving net zero. But in October the government published its conclusion that by 2050 there will probably still be ‘residual emissions’ from sectors that are hard to decarbonise, such as aviation, agriculture and heavy industry. So GGR will be necessary if the UK is to reach its target of zero emissions in net terms.

GGR and ‘net negative’

As major emitting nations such as China and India are not currently due to reach net zero until 2060 and 2070 respectively, there is also growing international acceptance that a period of ‘net negative’ may be needed, during which GGR could be used to reduce the total amount of carbon in the atmosphere year-on-year. Even if the ‘ratchet’ mechanism agreed at COP26 succeeds in increasing the speed of progress towards net zero, it is not clear that this will be rapid enough for 1.5°C to be met. Climate Action Tracker’s ‘optimistic scenario’, in which governments achieve their latest targets, still envisages around 1.8°C of warming by 2100 and warns that, unless current targets for emission reductions by 2030 are significantly toughened, the temperature increase will be much higher.

In its 2018 report on the 1.5°C Paris goal, the Intergovernmental Panel on Climate Change said pathways to achieving global net zero around 2050 are likely to include “some form of CDR with carbon storage on land or sequestration in geological reservoirs”. All its potential pathways to 1.5°C “use CDR to some extent to neutralize emissions from sources for which no mitigation measures have been identified and, in most cases, also to achieve net negative emissions to return global warming to 1.5°C following a peak”.

GGR options

GGRs are broadly, based on either natural processes or engineering innovations.

Nature-based approaches, such as reforestation and soil carbon sequestration, store carbon in natural sinks. There is a much wider variety of engineering-based approaches. For example:

  • Direct Air Carbon Capture and Storage (DACCS) removes CO2 from the air and either stores it under pressure below ground or uses it in commercial processes.

  • Bioenergy with Carbon Capture and Storage (BECCS) captures CO2 when biomass is used to generate energy and stores it underground.

  • Biochar is organic material treated by pyrolysis (i.e. carbonised at high temperature without oxygen). It is capable of sequestering carbon for long periods and can have beneficial effects when added to soils.

  • The use of domestically produced wood in construction as a way to store carbon is the only engineering solution not still at a pilot stage. About 50,000 homes a year are already built with wood frames in the UK. But its use on a much greater scale would require issues such as building requirements and safety and quality assurance to be addressed.

Enabling GGRs: the UK example

The UK government will consult on business models for engineered GGRs in spring 2022. This consultation should give an indication of the preferred incentives for early investment and commercial demonstration. No single method of GGR will be sufficient to meet likely demand, and as GGR methods are distinct technologies they will require a variety of bespoke regulation, business models and policy incentives. Each method will also provide GGR at a different cost, a different rate of deployment and a different period of carbon storage.

The development of a GGR market will bring a number of changes.

  • Regulatory restrictions can be expected, particularly (but not exclusively) by organisations in hard-to-abate sectors.

  • Polluters will be strongly incentivised to balance their emissions.

  • There may be a new regulator to verify and accredit emissions and enforce carbon accounting principles.

  • New environmental regulations may be enacted to balance potential adverse impacts on the environment.

  • We may see changes to planning or land laws to permit land use for GGR projects.

The roll out of some technologies, such as BECCS and DACCS, will be energy-intensive, increasing demand for low-carbon energy. And the availability of transport and infrastructure for the deployment of large-scale GGR projects will be key.

As the government noted in October, “GGR technologies remain at a pre-commercial scale of deployment, and few large-scale projects have been implemented worldwide. As a result, evidence around the scale-up potential and costs of engineered GGR solutions in the UK is uncertain and rapidly evolving.”

This evolution should be watched with interest by participants in sectors including energy, transport, agriculture and heavy industry, as it could lead to the rapid development of new markets and opportunities. The government hopes to see the deployment of commercial-scale GGR projects during the late 2020s and early 2030s, reducing technology costs, generating technical improvements, and developing supply chains to enable scaling-up through the 2030s and 2040s. Its “long-term vision is to establish a liquid market for carbon removals, in which polluters have a strong policy or financial incentive to invest in GGRs in order to balance their remaining emissions.”

Business in hard-to-abate sectors will also be monitoring similar initiatives elsewhere, such as the legislative proposal on carbon removal certification that the European Commission plans to introduce in 2022 and the Carbon Negative Shot initiative announced by the US Department of Energy.