US backs direct air capture as decarbonisation pressures mount

Decarbonisation goals are increasingly taking on more urgency as medium-term deadlines – such as those set for 2030 – are no longer that far away. With these targets in mind, attention is turning to newer technologies, including direct air capture (DAC). This technology allows for removal of CO2 directly from the atmosphere, typically for storage in underground geological formations. It generally requires a liquid solvent or solid sorbent that binds CO2, separating it from other gases in the atmosphere.

DAC is still a nascent technology, though the International Energy Agency (IEA) estimates that there were 18 DAC plants in operation globally as of September 2022, capturing almost 10,000 metric tons/year of CO2. This would need to be scaled up considerably if long-term decarbonisation targets are to be met, with DAC playing a part. The IEA projects in its net zero emissions by 2050 scenario that DAC would be capturing almost 60mn mt/yr of CO2 by 2030. While this would involve a major expansion of capacity, the agency says this level of deployment is “within reach,” though it would require several additional large-scale demonstration plants to hone the technology and reduce its costs.

In the US, the administration of president Joe Biden is trying to help boost the development and deployment of DAC. In December, the US department of energy (DoE) announced that it was making $3.7bn available to help kick-start the country’s CO2 removal industry via four programmes, with the funding available under Biden’s Bipartisan Infrastructure Law.

The programmes include the ability to apply for commercial and pre-commercial DAC prizes worth a combined $115mn. They also include a programme to develop four regional DAC hubs across the US to demonstrate a technology or multiple technologies at commercial scale with the potential for capturing at least 1mn mt/yr each of CO2. The DoE will allocate $3.5bn to this programme in total, and made more than $1.2bn of this available when it launched the programme in December.

The DoE also launched carbon utilisation procurement grants, which will be made available to states, local governments and public utilities to support the commercialisation of technologies that reduce emissions while also procuring and using commercial or industrial products developed from captured emissions. And it also unveiled the Bipartisan Infrastructure Law Technology Commercialization Fund (TCF), which is aimed at accelerating commercialisation of CO2 removal technologies, including DAC, by advancing measurement, reporting and verification best practices and capabilities.

Helping hand

The Biden administration is hoping that its programmes will help to accelerate private sector investment into CO2 removal, as well as spurring advances in monitoring and reporting practices. The opportunities to access additional funding will be welcomed by the emerging industry.

“Direct air capture is an exciting – perhaps the most exciting – frontier in carbon capture and sequestration,” a partner at law firm Shearman & Sterling, Omar Samji, tells Gas Pathways. “The DoE’s efforts to provide additional financial support are very helpful, and are a needed addition to the incentives provided under the Inflation Reduction Act (IRA),” he continued. This includes the Section 45Q tax credit for the capture and storage of CO2.

“DAC is prohibitively expensive with today’s technology, meaning that in order to move the needle towards practical feasibility, both economic support and innovative support is needed,” Samji says.

Given the costs and challenges involved for DAC players, the Biden administration will find itself under pressure from the carbon removal industry to maximise the support it can offer.

“The federal government needs to actively support the development and innovation of new technologies, and support the commercialisation of those innovations, in order for DAC to really become a part of the carbon reduction solution,” said Samji.

From the private sector’s point of view, there are also things that participants can do in order to help accelerate the roll-out of DAC.

“The private sector needs to do what it does best – which is find creative ways to make new and exciting technologies scalable and profitable,” says Samji. “In the case of DAC there is a very long way to go to achieve that, but I do think that the private sector will take advantage of the funding on offer from the federal government and apply it towards this goal.”

Next steps

It is still very early days for DAC, and a clearer picture of how the industry is advancing will emerge with time, as applicants come forward to benefit from the federal programmes on offer.

There are currently only a handful of DAC projects that are under development in the US. The most prominent among these include the project being developed in the Permian basin by Occidental subsidiary 1PointFive in partnership with Carbon Engineering. That project, which is expected to be online in late 2024, is expected to have the capacity to capture up to 500,000 mt/yr of CO2, with the capability to scale up to 1mn tonnes/year further down the line.

Meanwhile, CarbonCapture is developing Project Bison in Wyoming, which is anticipated to start up later this year and scale up until it has the capacity to capture and store 5mn mt/yr of CO2 by 2030. According to CarbonCapture, Project Bison will be the first DAC carbon removal project to use Class VI injection wells for permanent CO2 storage in deep saline aquifers, pending regulatory approval.

If these projects are seen to have early success, that could help spur other DAC players to follow suit, especially as pressure mounts to meet decarbonisation targets. At the moment plans to scale up DAC look particularly ambitious, but even a small number of successful projects could potentially help momentum to build, and federal financial support seems set to play a part as well.

“While economically capturing CO2 from the air at scale seems like a stretch today, the next one to two decades present enormous opportunity, and an adequate time window, to conquer that goal,” says Samji. “We need only look back at our technologies from one to two decades ago to see how quickly we can progress. Twenty years ago, the vehicles offered by Tesla today seemed like borderline science fiction. With the efforts and resources being applied to decarbonisation, including to DAC, I expect we will look back in twenty years with amazement at how much we will have advanced technologically from where we are today.”