Suddenly, even futuristic proposals like direct air capture – that currently rely on government subsidies - could start to have market allure. Add to that improvements in capture technology, and a reduction in the need for storage, and the costs fall further. If they are successful in finding high value uses, it will be a first step in bringing that $600 per ton price tag down for companies. Stanford University, working with the Department of Energy's SLAC National Accelerator Laboratory, is searching for ways to create zero-emissions fuels from CO 2. Researchers at the University of Toronto are exploring ways to use carbon dioxide to create plastics. will need by the 2040s to meet climate targets.īut if engineers can make cutting-edge technologies like direct air capture generate a return for shareholders on their own - without government incentives and without niche demands like those of Occidental – the financial benefits will push the technologies forward on their own. The EDF views investment in direct air capture as a starting point for developing the kinds of technology the U.S. Climate Policy and Analysis at the Environmental Defense Fund. The current high production costs are expected to fall with continued advancements in the technology, as happened with solar and wind generation, said Steve Capanna, the director of U.S. Occidental has a lot of oil reserves in West Texas that require the use of enhanced oil recovery techniques using carbon dioxide. The benefits for Occidental also rely on already-existing geographical conditions. Occidental’s plans rely heavily on a federal tax credit designed to stimulate investment in carbon capture. Direct capture of carbon dioxide costs a startling $600 per ton of CO 2, according to the Center for Carbon Management and Energy Sustainability at the University of Houston. While Occidental is promoting the advantages, a look at the math indicates steep economic challenges ahead. Hollub then listed these benefits: lowering its cost of enhanced oil recovery, selling its technology to others and at the same time, “helping the world by reducing CO 2 out of the atmosphere.” “We’re very committed to (direct air capture) and excited about it because this for us is a win-win-win,” said CEO Vicki Hollub in a recent earnings call. The plant will use new technology to essentially grab existing carbon dioxide out of the air, later using it for enhanced oil recovery in the Permian Basin in West Texas. Occidental has said it will begin construction by 2022 and is currently working to secure funding. The independent oil producer Occidental is betting big, with a proposed direct air capture plant that illustrates how technology can be commercialized when the financial benefits are clear. The biggest demand for captured carbon dioxide is in enhanced oil recovery, a complex and expensive process that injects carbon dioxide to shake loose oil that otherwise couldn’t be produced. Yet turning carbon dioxide into money-making products is still limited. In 2019, the oil-and-gas titan signed a joint development agreement with Global Thermostat to “advance breakthrough technology that can capture and concentrate carbon dioxide emissions from industrial sources, including power plants, and the atmosphere.” That’s a goal big players like ExxonMobil XOM are also looking into. The legislation is designed to push innovation in carbon capture. Plans include six new carbon capture technology projects by the end of 2025. It’s an issue that the 2020 legislation tries to tackle, calling for immediately increasing funding for carbon capture, utilization and storage to more than $1 billion, up from the current $200 million budget. “That is what will push the innovation and really drive costs down.” “How do I incentivize the growth of a carbon utilization scheme so that market forces can take over?” said Ramanan Krishnamoorti, a chemical engineer and chief energy officer at the University of Houston.
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