Union Budget | Rs 20,000 cr for Carbon Capture Utilisation and Storage tech: How it works, and the push for it

1. What are Carbon Capture Utilisation and Storage (CCUS) technologies?

As defined by the Department of Science and Technology, Government of India, “Carbon Capture, Utilization, and Storage programme aims to reduce carbon emission by either storing or reusing it so that captured carbon dioxide does not enter the atmosphere.”

In practice, this can include methods such as removing the carbon dioxide before burning a fossil fuel and capturing it, before compressing it into a liquid state and transporting it to suitable storage sites. This diagram by the International Energy Agency (IEA) shows the process.

How CCUS works. (IEA graphic)

Globally, the technology has found many takers. The European Union issued around $1.5 billion to CCUS projects under its Innovation Fund round, and over $500 million to CO2 transport and storage projects under its Connecting Europe Facility programme, the IEA has said. The Netherlands ($7.3 billion) and Denmark ($1.2 billion) have also made large investments.

2. How has India experimented with CCUS?

Since 2018, the Indian government has been undertaking joint Research & Development with several other countries to “identify and prioritise breakthrough technologies in the field of CO2 capture, separation, storage and CO2 value addition.”

A 2022 report from NITI Aayog, the government’s think tank, highlighted the need for its adoption, stating that, “Even if India is able to substantially green the grid and meet the target of 500 GW installed capacity of renewables by 2030, there would still be a need to meet the baseload power demand from fossil fuels (most likely coal) or other dispatchable sources, given the intermittency and non-dispatchable nature of solar and wind power.”

It said CCUS has a “critical role to play for India to halve CO2 emissions by 2050 and accomplish net-zero by 2070.” Net zero means that the amount of greenhouse gas emissions, as a whole, is reduced to such an extent that it can be neutralised by absorption (say in nature or through artificial removal measures), resulting in zero total emissions.

3. And what is the case against CCUS?

The first criticism stems from the cost and viability of CCUS projects. The NITI Aayog report noted that “Because of the high mobilization and laying expenses, the economics of CCUS cluster projects in the initial years is quite challenging due to lower CO2 volumes and the outsized infrastructure created.”

There are also only a few operational CCS projects globally, even though the technology has been pushed for decades. The IEA stated that there were 40 operational CCS projects in 2023, which captured more than 45 metric tonnes (Mt) of CO2 annually — China’s annual emissions in 2021 alone stood at 12,466.32 Mt.

A 2023 report from the London School of Economics (LSE) also explained, “The amount of CO2 that needs to be captured through CCUS to deliver large-scale emission reductions is much larger than the current market for CO2 usage.”

Writing in The Conversation, Tianyi Ma, a Distinguished Professor in Chemistry and Renewable Energy, said that despite being “invented by the oil and gas industry,” the technology has a place in a comprehensive strategy to mitigate climate change. At the same time, he acknowledged the argument that “The technology will likely be used to prolong the use of fossil fuels rather than phase them out as quickly as possible. In this view, carbon capture would be used by fossil fuel plant operators and companies as a way to make coal or gas “green”, and delay the full transition.”

He concluded that despite the increasing investments in green energy sources such as solar and wind, dependence on fossil fuels will remain. Global data also show that while the world is transitioning to renewable energy, much of that progress has been driven by mammoth investments from a single country — China.

He added, “We might not like the idea of carbon capture and storage, but we will need it if we are going to get serious about net zero. At present, there’s nothing else like it for hard-to-abate sectors. What we must avoid is using it to prop up fossil fuels.”