Carbon capture and storage

Carbon capture and storage (CCS) is a process that captures and stores carbon dioxide (CO₂). By preventing carbon from being released into the atmosphere or by removing it from the atmosphere, CCS can help reduce global greenhouse gas concentrations, which contributes to climate change.

The capture part of the process generally involves separating CO₂ from air or industrial exhaust in order to concentrate it. The carbon can be captured directly from an industrial smokestack (point-source capture) or by using large fans to collect carbon from the air (direct air capture or DAC).

The storage part of the process can include a variety of solutions.

CCS was first developed by oil and gas companies and involves injecting the CO₂ into partially depleted oil reservoirs to enhance their output. This process, called EOR (enhanced oil recovery), leaves the CO₂ underground.

Carbon capture and utilization (CCU) or carbon capture utilization and storage involve capturing carbon and then recycling it directly (e.g., in greenhouses) or using it as an ingredient in new products (e.g., concrete, fuels, chemicals).

CCU can help reduce emissions, and if the carbon is captured from the atmosphere and stays in a closed loop over many centuries (e.g., incorporated into building materials), the method may be considered removal.

Carbon dioxide removal (CDR) refers to processes where the captured CO₂ is durably stored in geological, terrestrial or ocean reservoirs or in products.

“Essentially, point-source carbon capture prevents new CO₂ molecules from reaching the atmosphere by capturing them before they’re released,” says Pascal Lanctot, a partner with BDC’s Climate Tech Fund.

He uses the analogy of water in a bathtub to explain techniques for reducing the amount of greenhouse gases in our atmosphere: “Reducing our emissions using point-source capture is like turning down the faucet, while direct air capture is like removing the plug from the bottom.”

Lanctot says that with no good commercial scale alternatives to airplane travel and heavy construction, there is a limit to how much we can turn down the faucet at the moment. CDR (or draining the bathtub) can help these industries lower their carbon footprint to help achieve Canada’s emissions reduction goals.

So far, traditionally carbon-intensive industries, such as oil and gas, have been the biggest users of CCS.

Carbon capture, utilization and removal, and direct air capture

While carbon and direct air capture, and carbon utilization and removal are methods within the broader family of carbon management, they have different impacts on climate change due to their distinct ways of handling of CO₂.

Carbon capture
The process of separating CO₂ from air or industrial exhaust.

Point-source capture
The process of capturing CO₂ from industrial flue gas (exhaust).

Direct air capture
The process of capturing CO₂ from the atmosphere or ambient air.

Carbon utilization
The process of using captured carbon and recycling it directly (e.g., in greenhouses, to extract oil) or as an ingredient in new products (e.g., concrete, fuels, chemicals).

Carbon removal
Processes where the captured CO₂ is durably stored in geological, terrestrial or ocean reservoirs.

Why is carbon capture important?

Lanctot says that emissions from agriculture, transportation, construction and industrial production are particularly challenging to reduce. Carbon capture appears to be an important way to offset emissions in those sectors. Those hard-to-abate industries represent an estimated 30% of global emissions.

He adds that carbon capture is not just for avoiding new emissions at the source in factories and power plants. Removing CO₂ that’s already been released in the atmosphere, via direct air capture, is also vital.

“We have to do both if we’re to limit climate change,” says Lanctot, whose background straddles business and science and who has been investing in clean tech since 2007.

How does carbon capture technology work?

Carbon capture technology captures CO₂ from sources like power plants and industrial processes, whereas direct air capture retrieves CO₂ directly from ambient air. Once carbon is captured, it is transported to a storage site. This is usually done via pipelines, but it can also be transported by ship or rail. Direct air capture has the advantage of having the capture site co-located with the storage site, thereby avoiding the need to transport CO₂.

For storage, the CO₂ is then injected into deep underground rock formations, such as depleted oil and gas fields, deep saline aquifers and basalt formations for mineralization. The aim is to store the CO₂ securely for long periods to prevent it from entering the atmosphere. The storage sites are carefully selected and monitored to ensure the CO₂ remains trapped.

Captured CO₂ can also be used in various industrial processes or products. As mentioned above, this is known as carbon capture and utilization, and it can be used to enhance oil recovery, the production of chemicals or even the creation of building materials like concrete.

How effective is carbon capture and storage?

Carbon capture from point sources is an effective technology. Amine scrubbers, which are attached to industrial chimneys, recover between 80% and 95% of CO₂, according to a report from the International Panel on Climate Change.

As for the effectiveness of storage, the depleted oil and gas fields or deep saline aquifers can hold the CO₂ securely for thousands of years.

Should an SME invest in carbon capture?

“Until new technologies allow for small-scale operations, carbon capture is something that has to be done at a very large scale for it to make economic sense,” says Lanctot. “You can’t just set up a small unit on a restaurant chimney.”

He says SMEs are better off reducing their carbon footprint with more feasible actions such as electrifying their fleet or switching to a heat pump.

How does carbon capture help limit the impacts of climate change?

CCS helps limit the impacts of climate change by reducing the amount of CO₂ released into the atmosphere from industrial processes and power generation. By integrating CCS into the broader effort to combat climate change, we can significantly reduce overall emissions while still meeting energy demands.

Lanctot sees carbon capture and storage as an important way to fight climate change and a means to offset emissions from hard-to-abate sectors.

“Currently, there’s no technology that will allow an airplane to fly from here to Australia with a battery or with hydrogen.”

However, the technology boom in CCS has had a positive, secondary effect, as companies that make the technology are also benefiting from a market that rewards those helping to reduce greenhouse gases.

“Many of the companies we invested in have sold or aim to sell their carbon credits on the voluntary carbon market,” says Lanctot. He adds that many large corporations like Microsoft, Frontier, Airbus and Google are buying carbon offsets to reduce their environmental footprint.

What are some examples of carbon capture?

BDC counted 69 carbon-removal companies in operation at varying levels of commercial readiness across Canada as of October 2023. Below are four examples:

Planetary Technologies is a Nova Scotia-based company developing methods that increase the ocean’s absorption and storage of carbon dioxide. This process is known as ocean alkalinity enhancement.

CO280 Solutions is a BC-based developer of point-source carbon removal projects that partners with pulp and paper companies to develop carbon dioxide removal projects that deliver permanent carbon removal credits to the voluntary carbon market.

Deepsky is a Quebec-based company that develops direct-air carbon capture and sequestration technologies and has been building what it calls the world’s first carbon removal innovation and commercialization centre in Innisfail, Alberta, which will have the capacity to capture and remove 3,000 tons of CO₂ per year.

AtkinsRéalis is a Quebec-based company that worked on Saskatchewan’s Boundary Dam Power Station, one of the world’s first commercial-scale retrofits of a coal-fired power plant with CCS technology.

How expensive is carbon capture?

“Right now, it costs between $500 and $1,000 per tonne to remove CO₂ from the atmosphere, and you can’t necessarily get that amount in revenue from selling the carbon credit,” says Lanctot. “So that’s why investors like us need to support and help develop the industry until the markets catch up and can help the companies make money.”

Next step

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