Without mandated demand for greenhouse gas removal – High integrity GtCO2-scale global deployment will be jeopardized: Insight from US economic policy 2020–23

Madison Cuthbertson, Mark Workman and Aoife Brophy

Applied Energy, 2024, vol. 372, issue C, No S0306261924011899

Abstract: Greenhouse gas removals (GGRs) will be essential at GtCO2-scale to offset residual emissions and achieve global net zero by 2050. Engineered GGRs have the greatest long-term, large-scale CO2 storage potential and, therefore, offer opportunities to realize high-integrity removals. However, the most prominent engineered solutions are capital-intensive, generate expensive offset credits, and have achieved minimal market penetration. The United States has established policies subsidizing GGR deployment value chains which generate high-integrity removals to bring down engineered GGR costs. The US regime has the potential to result in substantial GGR cost reductions which will likely have implications on the policy frameworks for global GGR technology deployment. To date, research addressing the impact of US policies on the commercial imperatives and investment uncertainties for the global GGR sector is limited. Using a mixed methods approach, this contribution unpacked the motivations of early private sector actors. It did this by identifying characteristics of the most investable GGR business models and policy implementation requirements to establish the nascent sector, which will be critical to the GGR sector becoming a global multi-trillion-dollar, self-sustaining market. The analysis reveals that cost reduction alone will be insufficient to establish a high-integrity global GtCO2-scale sector. Systemic market risks, especially certainty of offtake through demand-side incentives, need to be `addressed. Therefore, the development of a stable and sustainable GGR sector, both in the US and globally, will remain problematic due to the inability to attract large-scale private capital investment.

Keywords: Greenhouse gas removal; Climate change policy; Negative emissions technology; Net zero; Industrial policy (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1016/j.apenergy.2024.123806

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