The planned global CCUS capacity pipeline has reached 905 million tonnes per annum, according to consultancy firm Wood Mackenzie’s “CCUS Market Update for Q2” report.
However, despite accelerated progress, more developments are needed to meet climate targets.
Lucy King, Senior Research Analyst and author of the report, said:
“Despite continued momentum in the CCUS pipeline, much more progress is required to meet 2050 greenhouse gas targets.
“Currently, the CCUS capacity pipeline is close to aligning with Wood Mackenzie’s 1.5-degree pathway to 2030, but it will need to grow seven-fold by 2050 to reach the capacity required for net zero.”
The biggest hurdles impeding CCUS progress are the lack of government legislation as demand for CCUS is outpacing government’s abilities to set policies in place, said King.
King also added that the US’s Inflation Reduction Act will propel the deployment of carbon capture technologies in the US.
“The Inflation Reduction Act bill will further accelerate the US’ planned CCUS capacity pipeline, which is currently at almost 250 Mtpa. It will incentivise smaller-scale capture projects, attract more industries, and promote investment into technologies including Direct Air Capture.”
Great strides have also been made for licensing and permitting for geological CO2 storage throughout Q2 of 2022. The industry has seen an increase in licensing activity in Norway, Russia and Australia, with the UK launching the ‘first of its kind’ CO2 storage licensing round which consists of 13 areas across the North Sea.
North America and Europe continue to emerge as hotspots for CCUS activity, according to latest Wood Mackenzie research. North America accounts for over two thirds of current global capacity in 2022, with activity mainly focused in Alberta, the Gulf Coast and US Midwest.
Going forward, North America’s share of global CCUS capacity is expected to reduce to 2030 as hub projects across Europe scale up.
China and Southeast Asia are forecasted to have the biggest demand for CCUS in the 2040s, but this will require further regulatory and policy implementation.