Can direct air capture mature fast enough to contribute to net-zero pathways?

Decarbonisation, net-zero emissions, and sustainability have recently become popular buzzwords in the commercial world. More organisations than ever aspire to achieve net-zero emissions, recognising that increased environmental awareness has changed the way we make our purchasing decisions. The primary way to achieve these aspirations is by reducing anthropogenic greenhouse gas (GHG) emissions. It can be achieved through the transformation of our energy systems. Conventional fossil fuel technologies are to be replaced with low-carbon alternatives, such as renewable and nuclear energy, as well as carbon capture, utilisation and storage. Significant GHG emission reductions can also be achieved by implementing energy efficiency and behavioural measures.

However, there are a few areas in transport and industry where it is difficult to eliminate GHG emissions. Such residual emissions will need to be offset by GHG removal technologies. Notably, the most recent report by the Intergovernmental Panel on Climate Change (IPCC) forecasts that humanity will need to remove a total of up to 660 gigatonnes of CO₂ directly from the atmosphere by the end of the century (with respect to 2020) to limit global heating to 1.5°C.

What is direct air capture?

Removing this much CO2 will involve more than simply planting many trees. In fact, 10 million more trees are cut down than planted each year. Engineers and scientists are developing a solution called direct air capture (DAC). A typical DAC plant involves large fans that push air through a contacting device. It is where CO2 is removed from the air on contact with a specific type of liquid or solid material. It is a similar process to that taking place in lungs. In the existing DAC plants, the material used to remove CO2 from the air is then regenerated on heating, and concentrated CO2 is produced.

DAC is supposed to pull vast quantities of CO₂ from the air while using very little land and water compared to other CO2 removal technologies. The concentrated CO2 can then be either permanently stored, for example, underground in depleted oil and gas reservoirs, or reacted with low-carbon hydrogen to produce synthetic chemicals, for example, synthetic aviation fuels. Although the latter option could result in a re-release of CO2 back into the atmosphere, synthetic chemicals and fuels would reduce the need for fossil fuels. Such a CO2 use would support industries that are difficult to decarbonise, such as aviation, in achieving net-zero emissions.

Yet some consider DAC to be a distraction from the hard work of reducing carbon emissions. Critics point to the high energy and materials requirements of DAC that make it expensive and, therefore, not practical on the tight timescale left to avert catastrophic global warming. DAC costs can reach up to US$600 per tonne of CO₂ removed.

It is important to note that DAC technology is still in its infancy. Further research and development efforts are being pursued globally to reduce the cost to below US$100 per tonne of CO₂ removed. This would align the cost of DAC with that of other CO2 removal technologies. Moreover, the DAC business model will become economically viable at such removal cost, as the carbon prices and taxes around the world now reach between $90 and $180 per tonne of CO2, and are expected to grow.

DAC may appear to be a promising tool in the global net-zero transition. However, it is still unclear whether the technology developers will be able to improve its energy efficiency and reduce costs fast enough to remove CO2 at the necessary scale to slow climate change. There is also a risk that some industries will not implement GHG reduction measures as they wait for technologies like DAC to mature and offset their GHG emissions. That is why the role of GGR technologies must be clearly articulated and understood to avoid misuse.

Current DAC deployment status

Only 19 direct air capture projects have come online since 2010. Most DAC units were deployed by Climeworks, one of the leading DAC technology developers. A handful of these plants were opened by Global Thermostat and Carbon Engineering. Current DAC units remove roughly 0.008 million tonnes of CO₂ annually, equivalent to about 7 seconds of global annual CO2 emissions of 36.3 gigatonnes CO2 in 2021. It is a tiny amount considering that the International Energy Agency forecasted that about 1 gigatonne of CO₂ will need to be removed in 2050 alone.

The largest unit currently operating is the Orca plant, built by Climeworks and Carbfix in Iceland. It is the size of two shipping containers (about 0.006 ha). This project was launched in 2021 to capture and permanently store up to 4,000 tonnes of CO₂ a year in geological rock formations. It is equivalent to the amount captured by 170,000 trees on 340 hectares of land over a year. But cold temperatures in early 2022 caused operational issues at the Orca plant. Some basic plant machinery, such as belt drivers, froze due to harsh weather conditions that halt the plant operation. That is why further technology development and optimisation are necessary to achieve the desired large-scale removals.

Despite these setbacks, governments and private companies commit substantial funding for the research and development of DAC technology. Most recently, the Inflation Reduction Act in the US increased tax credits for removing and storing CO₂ from US$50 per tonne of CO2 to US$180 per tonne of CO2. In case when removed CO2 is used, the tax credit increases from US$35 per tonne to US$130 per tonne of CO2. The UK government has recently run a consultation on the design of viable business models for engineered GGR technologies, such as DAC. Microsoft, Stripe, and Shopify consider DAC as a part of their strategies for reaching net zero emissions.

DAC projects pipeline

Notably, most commercial DAC plants were deployed only after 2018, but with the current level of industrial and governmental support, more will be deployed during the mid-2020s. Climework and Carbfix have already started building a larger version of their Orca plant. The Mammoth plant, which will also be located in Iceland and powered by the Hellisheiði geothermal power plant, is planned to remove and permanently store in geological rock formations up to 36,000 tonnes of CO₂ a year when fully operational. With the construction expected to take up to 24 months, it will become operational in 2024.

Carbon Engineering, another leading DAC technology developer, is working with various partners worldwide to deploy a DAC unit they say will be the world's largest, capable of removing and permanently storing up to 1 million tonnes of CO₂ a year. It will be built in Permian Basin, US. It is also expected to begin operating in 2024. Among the others, this venture includes a multi-million US$ investment from United Airlines that will use DAC to offset emissions from its flights. The next plant by Carbon Engineering is expected to be erected in collaboration with an independent UK decarbonisation developer called Storegga in north-east Scotland and start operating in 2026. It will remove up to 1 million tonnes of CO2 annually. Other large-scale plants, which are expected to absorb more than half a million tonnes of CO₂ a year, are planned in Norway. Carbon Engineering has also partnered with Huron Clean Energy, a green infrastructure company, to build an air-to-fuel plant to produce 100 million litres of ultra-low carbon fuel from CO2 captured via DAC and green hydrogen. This plant is due to be turned on in Canada in 2026.

Global Thermostat, which is another DAC technology developer, has agreed to develop the Haru Oni eFuels pilot plant in Chile. This plant will remove about 2,000 tCO2/year and use it to produce synthetic gasoline. Such use of CO2 will likely result in its re-release into the atmosphere when gasoline is used, for example, in cars. As such synthetic gasoline is produced from CO2 removed from the air and green hydrogen produced from water and renewable energy, it will have a negligible carbon footprint.

Notably, replacing fossil fuels with synthetic carbon-neutral alternatives will support hard-to-decarbonise sectors, such as aviation and transportation, in their transition to net zero. However, the technology developers still need to demonstrate that the business model behind air-to-fuel technologies is competitive with the one that relies on the use of fossil fuels. Therefore, more pilot plants like the Haru Oni eFuels pilot plant will be required to better understand technology challenges and reduce costs.

Business model behind DAC

Commercial DAC plants are now expensive to run and consume lots of energy. The IEA has estimated that removing up to 1 gigatonne of CO₂ a year from the air in 2050 will consume up to 1667 terawatt-hours of low-carbon energy – an equivalent to 1% of global energy consumption in 2019 that was 173,340 terawatt-hours.

CO2 removal costs via DAC are high now. However, costs are expected to drop to between US$125 and US$335 per tonne of CO2 by 2030-2040, with the prospect of achieving below US$100 per tonne of CO2 in the long term. This will depend on DAC units being deployed and developers learning from these demonstration units, similar to how the cost of solar energy fell over time.

DAC with permanent CO2 storage could become financially viable in the 2030s if falling costs are met by the rising price of carbon in tax regimes. According to the International Monetary Fund, the average price of CO₂ in the countries where carbon taxes or pricing mechanisms exist hit US$6 per tonne in 2022 and is set to increase to US$75 by 2030. The EU Emission Trading System priced a tonne of CO₂ at US$90 per tonne in 2022. The Inflation Reduction Act recently increased tax credits for companies removing and storing CO₂ in the US from US$50 per tonne to US$180 per tonne. But high carbon prices are far from the norm elsewhere. In China, the carbon price hovered between US$6 and US$9 per tonne in 2021 and 2022.

DAC could also become viable if the CO₂ it removes is monetised. But this is risky. One application of DAC is enhanced oil recovery, which involves pumping concentrated CO₂ underground to extract more oil. Estimates suggest this method could emit 1.5 tonnes of CO₂ for each tonne removed. Although this strategy could reduce the net emissions of conventional oil production, it would still add carbon to the atmosphere.

Opportunity may also arise in industries that need concentrated CO₂, like food manufacturers. The CO₂ price has surged from US$235 a tonne in September 2021 to upwards of US$1,200 recently.

This is because the majority of CO₂ in the UK is sourced from the fertiliser industry, where soaring natural gas prices have wreaked havoc. Although current global demand is limited to about 250 million -300 million tonnes a year, DAC could soon offer a more affordable and climate-neutral supply of CO₂.

Furthermore, new DAC technologies are being developed. For example, Mission Zero Technologies, an early-stage UK DAC start-up, develops electrochemical DAC technology that will use electricity, rather than heat, to regenerate CO2 removal material. This start-up aims to reduce the energy requirement of DAC by 3-4 times. Yet such technologies require further development. Costs will reduce as a result of research and learning from commercial activities.

Yet, the current cost estimates for DAC carry a high degree of uncertainty. It is partly because these often come from technology developers rather than independent studies. Moreover, there is no commonly accepted and used approach to quantifying the economics of DAC.

Will DAC mature fast enough to support 1.5°C targets?

But the question remains whether DAC technology developers will be able to achieve such cost reduction and accelerate DAC deployment on time. The world needs to build about 30 large-scale DAC plants (capable of removing more than 1 million tonnes of CO₂ a year) each year between 2020 and 2050. With only a few such plants expected to be operational by the mid-2020s, overcoming this shortfall will be challenging, especially if cost remains high and breakthrough DAC technologies are not discovered and commercialised.

Although DAC is expensive now, I strongly believe that we are yet to unlock its true potential through blue-sky research and out-of-the-box thinking. Notably, when the predicted cost reductions are achieved, DAC can unlock the pathway to large-scale CO2 removals with a much smaller land and water footprint than other CO2 removal technologies. It can also prove transformational to the chemical and petrochemical industries. The currently planned pilot plants already aim to demonstrate DAC's value in synthesising chemicals and fuels that will replace fossil fuels, for example, in the aviation and transportation sectors. However, the benefits of DAC need to be treated with caution. They should not be misinterpreted, for example, to promote solutions like enhanced oil recovery. Furthermore, DAC cannot be seen as a replacement for global efforts to reduce reliance on fossil fuels. Instead, it is a complementary technology that can close the GHG emission gap should this be necessary beyond the 2030s.

This opinion piece is an extension of an article published in the Conversation. Illuminem Voices is a democratic space presenting the thoughts and opinions of leading Sustainability & Energy writers, their opinions do not necessarily represent those of illuminem.