Carbon capture and storage (CCS) could be part of the solution that helps the world manage unavoidable emissions. It covers the process of capturing and storing carbon dioxide and can be applied across many industries.
According to a special report from the International Panel on Climate Change (IPCC), global warming can be limited through combinations of new and existing technologies, including carbon capture.
Given its potential, there’s an urgent need for further progress. But what does the sector look like in Europe right now and what role can startups play going forward?
We’ve crunched the data and spoken to experts in technology innovation to understand more about CCS today — and its potential for the future.
Global warming is likely to reach 1.5C between 2030 and 2052
The IPCC’s special report warns that global warming is likely to reach 1.5C between 2030 and 2052 if it continues to increase at the current rate. Staying below 1.5C is also the climate goal of the UN Paris Agreement, which calls for countries to decarbonise to avoid climate impacts that will be irreversibly harmful for people and the entire planet.
Carbon capture storage is a proven technology, but the scale needed to unlock the full potential of CCS requires more innovation and that needs to happen much faster
“In their 2020 report, the IPCC estimated that humankind has a 50% likelihood to limit global warming by the year 2100 to 1.5C if the global carbon budget of 500 gigatonnes is not exceeded,” says Geert van de Wouw, managing director at Shell Ventures, the corporate venture capital fund of Shell. “CCS is essential to stay below 1.5C warming by the end of this century.”
According to the International Energy Agency (IEA), it will likely be “impossible” to decarbonise without carbon capture and storage. However, a recent report warns carbon capture and storage alone will not get us to net zero emissions, and should not be used to extend the life of fossil fuel infrastructure.
“Carbon capture and storage is an essential part of the equation for the world to achieve a net zero future,” says Akilah LeBlanc, general manager of Shell GameChanger, Shell’s accelerator programme. “Fortunately, CCS is a proven technology, but the scale needed to unlock the full potential of CCS requires more innovation and that needs to happen much faster.”
In 2021, the global capacity of planned CCS projects grew 50%, reaching 111m tonnes
A report by Melbourne-based think tank Global CCS Institute, whose mission is to accelerate the deployment of carbon capture and storage, says that the planned global capacity for CCS projects grew by 50% in just nine months in 2021.
In 2021, the Clean Air Task Force’s (CATF) Europe carbon capture project and activity map mapped over 40 carbon capture projects which had been announced across 13 different European countries.
“We see more and more startups and corporations working to accelerate the development of key technologies,” says van de Wouw, adding some of those startups are finalists in this year’s New Energy Challenge, a competition for European startups in renewable energy.
One company is Airovation Technologies, an Israel-based startup providing air purification and carbon capture solutions.
“Europe has led the world in carbon capture regulation and mitigation over the past few years,” says Inbal Kan-Tor, head of CCUS business at Airovation Technologies. “There are many technologies that are being developed by European companies, and many corporations on the continent that are actively seeking technologies.”
Of course, CCS innovation isn’t just limited to capturing carbon from exhaust stacks and storing it underground. Emissions can also be captured from the production of bioenergy — such as making biofuel from food waste or manure.
In Europe, less than 10% of CO2 captured is utilised
Dealroom data shows that the vast majority of the CO2 captured will go into permanent storage — and it’s estimated that we can currently only utilise less than 10%.
Energy4Future is a Germany-based startup that is set to develop, build and operate 10-15 biochar production plants in Europe over the next 10 years.
Andreas Schimanski, executive partner at the company, believes it’s important to have applications of carbon in addition to capturing and storing it. Launched in 2009, he says Energy4Future has sold more than 10k tonnes of biochar — an organic material that has been carbonised under high temperatures. It has multiple uses including improving water quality and reducing the soil emissions of greenhouse gases.
“If you can capture carbon and emit it back into soil, you can really reduce the CO2 out in the atmosphere too,” says Schimanski. “It's very, very important for startups to apply or open up new routes, new ideas, new technologies and new applications. We need to innovate more to accelerate progress.”
Kan-Tor agrees, adding the carbon utilisation industry got a boost after more legislation was made to target carbon emissions.
“There has been rapid growth in developments and investments in different carbon capture technologies,” she says. “There’s also an increased understanding that capturing the carbon is not enough, and that we must find utilisation and storage solutions.”
What does all this mean for startups?
While innovation in Europe’s technologies to capture, store or remove carbon continues to grow, startups looking to enter the sector continue to face hurdles along the way.
The engineers developing these technologies don't have access to millions of euros. They need external partners who believe in the technology and help them to get cash and become profitable
“Generally speaking, it's often a question of cash,” says Schimanski. “We get support from the government and some banks, but we also have to put in some equity.
“This is usually the biggest hurdle for startups because the engineers developing these technologies don't have access to millions of euros so can’t do it on their own. They need external partners who believe in the technology and help them to get cash and become profitable.”
To support the carbon capture sector, van de Wouw believes governments need to establish regulatory frameworks to incentivise carbon capture and removal, such as carbon pricing and credible trading mechanisms. And consumers need assurance and access to credible information that enable them to preferentially purchase lower-carbon goods.
He also calls for a need to accelerate the commercialisation and deployment of promising CCS technologies. This could be achieved by stimulating collaboration between academia, entrepreneurs and industry, he says.
Airovation Technologies’ Kan-Tor agrees, adding that “the industrial sector in general and the energy sector in particular are well-positioned to create the most significant change through collaborations on diverse solutions”.