Carbon Capture and Storage 101

An overview of CCS technology, including how it works, where it is currently used in the United States, barriers to more widespread use, and policies that may affect its development and deployment.

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Date

May 6, 2020

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Explainer

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5 minutes

Carbon capture and sequestration/storage (CCS) is the process of capturing carbon dioxide (CO₂) formed during power generation and industrial processes and storing it so that it is not emitted into the atmosphere. CCS technologies have significant potential to reduce CO₂ emissions in energy systems. Facilities with CCS can capture almost all of the CO₂ they produce (some currently capture 90 or even 100 percent). This explainer provides an overview of CCS technology, including how it works, where it is currently used in the United States, barriers to more widespread use, and policies that may affect its development and deployment. It also includes a list of additional resources for further reading.

Carbon Capture and Utilization

In some cases, captured CO₂ can be used to produce manufactured goods and in industrial and other processes, rather than being stored underground. Such utilization leads to the acronym CCUS (carbon capture, utilization, and storage). Different CO₂ uses lead to different levels of emissions reductions, depending on whether the CO₂ is permanently stored and whether its use displaces the use of fossil-fuel products or CO₂ produced in another way. One of the primary uses of CO₂ is for enhanced oil recovery (EOR), a method of oil extraction that uses CO₂ and water to drive oil up the well, improving oil recovery and sequestering the CO₂ underground. Selling CO₂ for EOR and other uses can provide revenue to CCS facilities, incentivizing further implementation of CCS technologies.

The State of CCS

According to the Global CCS Institute’s 2019 Status Report, 40 million metric tons of CO₂ from plants currently in operation or construction are captured and stored each year (for context, the United States alone emitted over 5 billion metric tons of CO₂ in 2018). Globally, there are 51 large-scale CCS facilities in operation or under construction. In the United States alone, there are 10 large-scale operational facilities, as shown in the map below. (The Global CCS Institute defines “large-scale facilities” as power plants capturing at least 800,000 metric tons of CO₂ annually and other industrial facilities capturing at least 400,000 metric tons of CO₂ annually.)

How CCS Works

Deploying CCS at a power plant or industrial facility generally entails three major steps: capture, transportation, and storage.

Several different technologies can be used to capture CO₂ at the source (the facility emitting CO₂). They fall into three categories: post-combustion carbon capture (the primary method used in existing power plants), pre-combustion carbon capture (largely used in industrial processes), and oxy-fuel combustion systems. For post-combustion carbon capture, CO₂ is separated from the exhaust of a combustion process. There are commercially available pre-combustion capture technologies used by industrial facilities; however, for power plants, pre-combustion capture is still in early stages. This technology involves gasifying fuel and separating out the CO₂. It may be less costly than other options; however, it can only be built into new facilities—to retrofit an existing facility for pre-combustion capture would be prohibitively costly. For oxy-fuel combustion, fuel is burned in a nearly pure-oxygen environment, rather than regular air, which results in a more concentrated stream of CO₂ emissions, which is easier to capture.

Once the CO₂ is captured, it is compressed into a fluid and transported to an appropriate storage site, usually by pipelines and/or ships and occasionally by trains or other vehicles.

Finally, in the third step, the CO₂ is injected into deep, underground geological formations, where it is stored long term, rather than being released into the atmosphere. Storage sites used for CO₂ include former oil and gas reservoirs, deep saline formations, and coal beds.

Barriers to Deployment

Cost of Implementation

One of the most significant barriers to widespread deployment of CCS technologies is the high cost of the technologies. Although cost estimates vary widely, the greatest costs are typically associated with the equipment and energy needed for the capture and compression phases. Capturing the CO₂ can decrease plants’ efficiency and increase their water use, and the additional costs posed by these and other factors can ultimately render a CCS project financially nonviable. (Increased water use may also pose problems for plants that already face water scarcity.) Additionally, since CCS deployment is in its early stages, financial returns on a CCS project are riskier than normal operations. Consequently, investors impose higher risk premiums (the minimum amount of expected return required to attract investment), which further increases the private cost of the necessary capital. Mitigating risk for investors is vital for incentivizing investment and development of CCS. In order to realize full-scale deployment, additional research and development is required to optimize technology design and integration. Presently, the Department of Energy’s Carbon Capture Program is exploring these issues.

Transportation Challenges

In addition to high costs of capture technology, there are also challenges associated with transporting CO₂ once it is captured. Transportation is costly: significant energy is required to compress CO₂ and maintain high pressure throughout pipelines, and the pipelines themselves are expensive. In order to safely carry the condensed, highly pressurized CO₂, pipelines must be specially designed: existing oil and gas pipelines cannot be used. Impurities in the CO₂ stream (including water) can cause damage to pipelines and lead to dangerous leaks and explosions as the compressed fluid rapidly expands to a gas. Finally, each source of CO₂ must be connected to an appropriate storage site via pipeline, which can make CCS more difficult and expensive to implement in areas without geological formations that are appropriate to use for storage.

Storage Considerations

The availability of geologic storage is generally not considered a barrier to widespread CCS deployment—at least not in the short to medium term. Indeed, there is probably plenty of storage worldwide for at least the next century, including specifically in the United States. While some researchers have expressed concerns about the long-term ability of storage sites to sequester carbon without significant leakage, a 2018 IPCC report concludes that “current evaluation has identified a number of processes that alone or in combination can result in very long-term storage” (pg. 245). There is also some potential for seismic activity caused by underground injection of CO₂; researchers continue to look at ways to minimize this risk, including considering above-ground carbon dioxide mineralization as an alternative to underground storage.

Uncertain Public Support

Finally, public support is increasingly recognized as critical to the widespread implementation of CCS. However, it is not well known how the public currently perceives the technology. Several considerations play a role in public opinion about CCS: acceptance of fossil fuels (as CCS may be viewed as prolonging the role of fossil fuels in the economy); acceptance of pipeline construction; perceived safety of transportation and storage of CO₂; perceived effectiveness of CCS; the extent to which other climate solutions are implemented in addition to CCS; and several other considerations that can shape an individual’s view of CCS and, therefore, overarching public opinion. Further research is needed to better understand how the public thinks about and would react to substantial deployment of CCS.

Policies Related to CCS

As highlighted in the Intergovernmental Panel on Climate Change’s Special Report on Carbon Dioxide Capture and Storage, in order to accelerate CCS development, policies that increase demand and reduce the costs will be needed. Several different types of policies have the potential to bring down the costs of CCS and encourage research, development, and deployment, including carbon pricing policies, public investment and subsidies, and clean energy standards that credit companies generating electricity or other energy sources with CCS.

In the United States, multiple enacted policies aid and encourage the use of CCS technology. National tax credits for carbon sequestration are created through Section 45Q of the Internal Revenue Code. Adding to these national tax credits, several tax credit and other crediting mechanisms exist at the state level in California, Texas, Louisiana, Montana, and North Dakota.

In addition to these existing policies, several proposed policies could impact the rate of development for CCS, including the Launching Energy Advancement and Development through Innovations for Natural Gas Act, Enhancing Fossil Fuel Energy Carbon Technology Act, and the Fossil Energy Research and Development Act of 2019. These policies differ in several ways, including how they would incentivize CCS deployment.

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