Green investment hit a milestone in 2022: The world put as much money into replacing fossil fuels as it put into producing them, with clean energy investments jumping 31% from 2021 to top $1 trillion for the first time. Of course, it’s not job done. Annual investments into decarbonizing the economy must triple for the rest of this decade. One area that’s seen a dramatic expansion in investment lately is carbon capture.
Removing carbon dioxide from the atmosphere sounds like a fantastical solution to the climate crisis. Nevertheless, thanks to human interventions, an estimated 2 billion tons of CO2 are currently drawn down and locked up per year — underground, in tree trunks, within minerals, at the bottom of the ocean.
It’s the first time we’ve been able to put a figure on the process, which comes by way of a new report that aims to fill the knowledge and data gaps on an emerging carbon removal industry. The report also takes stock of what we have done and will have to do to meet the Paris climate goals. The conclusion: We still need a lot more carbon dioxide removal (CDR) capacity.
First, let’s put the 2 billion tons in context. Imagine that CO2 removal and storage is a time machine that can take us back to an ideal state, say about 275 years to the preindustrial era. Based on our 2022 emissions, we’re only turning back the clock by 18 days a year. What we’re pumping out, via land use and fossil fuels, far outweighs anything we’re drawing down.
Of that 2 billion, the vast majority comes from conventional land-based CDR: afforestation, reforestation, land management and the use of durable wood products (for example, a wooden house will store carbon for as long as the building remains intact). A tiny fraction — equivalent to 30 minutes of emissions a year — currently comes from the sexy new technologies that have been the focus of headlines recently, such as direct air capture (DAC), bioenergy with carbon capture and storage (BECCS) and ocean alkalinization. Based on current planned and funded projects, this so-called novel CDR capacity will increase to 11.75 million tons a year by 2025, or 2.5 hours of emissions.
Even so, there’s a large gap between what countries have pledged in their Nationally Determined Contributions (the national climate plans at the heart of the Paris agreement) and the modeled scenarios that meet the Paris goal — limiting warming to well below 2 degrees Celsius. Stephen Smith, co-author of the report, says a lack of awareness and policy are holding back the deployment of novel CDR methods.
There has been some progress. The European Commission has proposed a voluntary framework to certify carbon removals; the U.S. has enhanced tax credits as part of the Inflation Reduction Act and the U.K. has launched a consultation on business models for drawing down greenhouse gases. But there’s still a lot of work needed to close the gap. For one, explicit targets have yet to be set.
There are good reasons for governments to utilize novel CDR methods at the same time as expanding established land-based carbon capture and storage. Questions have been raised over whether there’s enough land to meet nations’ and companies’ tree planting pledges while maintaining food security. Furthermore, carbon locked up in forests can be reversed by wildfires, disease and pests — threats that are becoming more common as the world heats up.
DAC gets a lot of attention because it’s really easy to understand: Air passes through a machine, which traps CO2. But there’s a diverse range of methods being developed with the potential to offer other benefits. Biochar and soil carbon sequestration could help improve soil quality and resilience in countries that suffer drought. Ocean alkalinization and coastal wetland management could have positive effects on biodiversity.
But not everyone shares the view that novel CDR needs to be part of society’s decarbonization. Mark Z. Jacobson, professor of civil and environmental engineering at Stanford University, maintains that the world can get to 100% renewable energy easily by 2050 using just wind, solar, geothermal energy and hydropower. It’s part of an ongoing debate. Is a focus on new CDR methods and other emerging technologies actually slowing down the energy transition? Should all our effort and money instead be spent setting up wind turbines and solar farms?
Judging from what’s being invested, it’s hard to believe CDR funding is slowing down decarbonization. Only a small proportion of spending is currently going toward the processes. Investment in CDR capacity totaled $200 million between 2020 and 2022. Compare that to the $366 billion that went into renewables in 2021 alone. Meanwhile, global public investment in CDR research and development was about $4.1 billion between 2010-2022; hold that up against the $17 billion spend in 2021 for energy research in OECD nations.
The debate may be over the wrong issue. Its real nub may lie with the allure of carbon offsets. Many have proven to be bunk, and have been criticized for perpetuating a “business as usual” mind-set. Instead, high-quality standards can be set to eliminate greenwashing and support a verifiable carbon removal industry. The Science Based Targets initiative (SBTi) has dictated that to meet criteria for net zero, 90% of a company’s decarbonization must be achieved by reducing emissions — not just by offsetting CO2. The residual emissions should then be neutralized using permanent carbon removal. As new CDR methods come online, it will be paramount to establish policies and processes for monitoring and independent verification.
It’s also important to note that all the pathways modeled to meet the Paris goal involve rapid emissions cuts and a scaling up of CDR. The scenarios least reliant on CO2 removal require the deepest and most rapid decreases in carbon; that feels ever less achievable the longer we go on funding new fossil fuel projects and hitting record greenhouse gas emissions.
Ultimately, a lot of what is required to get CDR off the ground also leads to a reduction in emissions: systems for the transportation and storage of CO2, plentiful clean energy, more sustainable land management practices. If we approach these technologies with the right policies, renewables and carbon removal projects can complement each other and perhaps — one day — help us reach beyond net zero.
Lara Williams is a Bloomberg Opinion columnist covering climate change. This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
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