Carbon capture and sequestration (CCS) are technologies that help decrease CO2 emissions from existing & new gas & coal-fired power plants. Moreover, these also reduce gaseous emissions from large industrial setups. Carbon capture and sequestration is a 3-step method. It includes capturing CO2, transporting it, and injecting the same in underground rock formations. These formations containing porous rocks are present almost a mile under the earth.
The global Carbon Capture and Sequestration Market is expected to reach over USD 19 billion by 2024 growing at a CAGR of over 25% from 2016 to 2024. Rising global demand for energy coupled with awareness about reducing carbon emissions in industrial economies can drive the global market.
Carbon dioxide capture & sequestration allows ‘low-carbon electricity’ production from power plants and lowers greenhouse gas emissions. These technologies significantly reduce CO2 emissions from power plants burning fossil fuels, by almost 80 to 90%. The potential sites for CO2 sequestration must necessarily undergo site characterization in order to store CO2 safely & securely.
Once transported to the storage site, the compressed carbon dioxide is then injected into porous and solid rocks situated deep inside the earth. These rocks include shale, sandstone, basalt, and dolomite among others. Appropriate formations for carbon sequestration are situated beneath one or more cap rock layers that trap the carbon dioxide and avoid its upward migration. All these sites are then thoroughly supervised to ensure that the carbon dioxide stays underground permanently.
A number of alternate technologies, such as solar, nuclear, etc. are now underway while some are in practical use also. However, carbon capture is by far the most feasible technology to lessen greenhouse gas emissions from large-scale utilization of fossil fuels.
Globally, at present, there are over 22 functional carbon capture projects and 14 planned projects that would be operational over the next couple of years. The global carbon dioxide capture & sequestration market however is still in the nascent stage. Factors, such as the global economic slowdown (particularly in China & Europe) and inconsistent government regulations are responsible for the sluggish growth of the industry.
The existing regulatory framework fails to address the unique issues that crop up in the global CCS market. Some of these issues include the need for proper site characterization and in-depth monitoring. This industry needs a strong regulatory & legal framework since the application of this technology involves various parties in the entire process.
Assurances on the regulation of carbon dioxide coupled with potential social & environmental issues and financial liabilities regarding the leakage of this gas call for clarity. Apart from being a cost-effective alternative for lowering carbon emissions, carbon capture is best suited for controlling air pollution. Due to such factors, the Carbon Capture & Sequestration Market is expected to expand considerably over the forecast period. However, presently there are a number of countries that are yet to adopt this technology because of various regulatory problems. Another factor contributing to its low adoption rate is the high initial & operating costs.
The global Carbon Capture & Sequestration Market is categorized as applications, technologies, and regions. The technology segment comprises industrial, pre-combustion, post-combustion, and oxy-firing. With a more than 73% market share, the pre-combustion segment dominated the industry in 2015. This technology may further witness substantial growth during the next eight years. Pre-combustion carbon-capture using water gas shift reaction and elimination with AGR (Acid Gas Removal) methods are being commercially followed worldwide.
For 90% carbon capture, the energy penalty induced by the PCC technology is around 30%. However, the same generated by the pre-combustion carbon capture technology is just about 20%. This is the major advantage of employing the pre-combustion technology. As a result, this segment may grow robustly during the forecast period. The post-combustion capture technology is projected to register a high CAGR in the same period. Newly developed superior amine systems, heat integration systems, and increased generation of energy may propel demand.
Based on applications, the global market is segmented into Global Enhanced Oil Recovery (EOR), agriculture, and industrial. EOR activities led the overall market in 2015 and accounted for the highest revenue share. Declining productivity in conventional oil reserves and rising dependency on crude oil imports (particularly in the Asia-Pacific) have resulted in the widespread application of gas injection EOR techniques. Fluctuating prices of crude oil may lead to greater market penetration in EOR applications over the next few years.
The growing need for extracting gas & oil from unconventional & low-permeability reserves, such as tight sands and carbonate traps, could positively impact demand for the EOR process. Technologies that utilize the carbon dioxide discharged during the manufacturing stage may exhibit enormous growth prospects in the near future. Owing to these factors, carbon applications for EOR may dominate the global Carbon Capture and Sequestration Market from 2016 to 2024.
On the basis of regions, the industry is fragmented into North America, Europe, Asia Pacific, Central & South America, and the Middle East & Africa. North America has been dominating the global market over the past few years. The region is mainly driven by stringent regulatory norms and demand for carbon dioxide in EOR processes. Heightened environmental concerns directly impact demand.
The Asia-Pacific market can grow robustly during the forecast period. The developing countries in this region, such as Indonesia, India, and China and countries, such as Japan are increasingly aiming at cleaner environment. This attributes to rapid industrialization that has led to high carbon discharge. Preference for clean power technologies in addition to the strict implementation of emission standards could induce high investments in the global market in the forecast period.
Major players in the worldwide Carbon Capture and Sequestration Market are The Linde Group; Mitsubishi Heavy Industries Ltd.; Statoil ASA; Sulzer Ltd.; and AkerSolutions ASA. Most of these companies aim at developing novel and effective carbon capture technologies. The North American & European companies primarily focus on greater research & development for improving the EOR processes. However, huge initial investments & operating costs restrict new players from entering the industry.
Research Support Specialist, USA