The Carbon Capture, Utilization, and Storage Market Projected to Grow at a CAGR of 13.7% and Generate a Revenue of $5,306.7 Million by 2028Download Sample Reports Overview
The global carbon capture, utilization, and storage market is predicted to be valued at $5,306.7 million by 2028, surging from $1,912.9 million in 2020, at a noteworthy CAGR of 13.7%.
COVID-19 Impact on Carbon Capture, Utilization, and Storage Market
The coronavirus outbreak has led to enormous uncertainty for the deployment of carbon capture, utilization, and storage projects. For instance, before the pandemic hit, many new CCUS projects were announced since 2018 especially in Europe and U.S. However, the COVID-19 pandemic has created vulnerable delays and cancellations of CCUS projects owing to the economic crisis. For instance, the oil & gas companies that are majorly involved in carbon capture, utilization, and storage projects have announced drastic reduction on capital spending in 2020. The CCUS technology is retrofitted in oil & gas sector to capture the CO2 emissions from this sector and reduce its release into the atmosphere. Hence, the clump in the slump in economic activity owing to COVID-19 crisis is estimated to curb the interest in the new CCUS projects in near term.
However, the prospects for CCUS projects are driven by new project development and new funding announcements in 2020. For instance, in April 2020, the U.S. government had announced $85 million in grants with further $46 million grants for the development and deployment of CCUS project in the U.S. Also, an additional $72 million funding was announced in September 2020. These aspects are anticipated to contribute towards sustainable economic recovery plans post-pandemic.
Global Carbon Capture, Utilization, and Storage Market Analysis
Growing concerns over reducing the emission of CO2 to lower the atmospheric CO2 concentration along with meeting the global energy demand are estimated to propel the market size. Lowering the amount of CO2 being released into the atmosphere is possible by implementing the energy efficient systems. The carbon capture, utilization, and storage (CCUS) technology incorporates multiple aspects that can effectively remove or capture CO2 from atmosphere or from the flue gas followed by its utilization and efficient storage. In CCUS, the carbon capture process involves the development of sorbents that can bind to the CO2 present in the flue gas or atmosphere, which is then captured and compressed. This captured CO2 is then converted into useful chemicals which is of commercial importance such as oil extraction. Thus, the CCUS technology helps in achieving the net zero or negative emission goals. For instance, negative emissions from power generation sector are possible by combining the CCUS systems with bioenergy.
However, high cost associated with carbon capture, storage, and utilization owing to the high cost associated with capturing the CO2 and its compression is predicted to limit the market growth. In addition, the cost of purchasing the equipment and research & development cost involved in the deployment of CCUS for optimizing its design & integration are anticipated to hahamper the CCUS market growth during the forecast period. nweight restrain the CCUS market demand during the forecast period.
Technological advancements in carbon capture, utilization, and storage (CCUS) technologies by startup companies are anticipated to generate excellent growth opportunities. For instance, the direct air capture (DAC) technology developed by Carbon Infinity, the Chinese startup, captures the CO2 from the atmosphere. In this solid DAC technology, the solid sorbent filters are used that chemically bind with the CO2. These filters are then heated to release concentrated CO2, which is then captured for further use. This technology will help in eliminating the need for long-distance CO2 transportation, thereby reducing the land & water usage, and mitigating the effects of climate change. Similarly, the CO2 sequestration monitoring by Silicon Microgravity, the British startup company, is a boon for carbon capture, utilization, and storage technology. For instance, CO2 sequestration monitoring facilitates detecting the leakage at injection or subsurface conditions to prevent its release into the atmosphere.
Global Carbon Capture, Utilization, and Storage Market, Segmentation
The global carbon capture, utilization, and storage market is segmented based on service, technology, end-use, and region.
The service segment is further classified into capture, transportation, utilization, and storage. Among these, the capture sub-segment is anticipated to have a dominant market share and shall surpass $3,753.2 million by 2028, with an increase from $1,318.3 million in 2020. The carbon capture is an integral step in carbon capture, utilization, and storage technology, in which the CO2 is captured from various sources such as power generation and industrial facilities that rely on fossil fuel or biomass for fuel. Various carbon capture technologies are chemical absorption, oxy-fuel separation, calcium looping, physical separation, membrane separation, chemical looping, direct separation, and others. Among these, the chemical absorption is widely used for small- and large-scale projects in power generation, industrial production, and fuel transformation.
The technology segment is further classified into pre-combustion capture, oxy-fuel combustion capture, and post-combustion capture. Among these, the post-combustion capture is anticipated to have a dominant market share and shall surpass $2,450.4 million by 2028, with an increase from $873.5 million in 2020. The post-combustion capture technology plays an important role in generating electricity from fossil fuel power plants. For instance, the U.S. Energy Information Administration (EIA), the platform that offers energy statistics, stated that more than 60% of electricity generated in the U.S. from fossil fuel-based power plants is produced by deploying the post-combustion capture technology that focuses on reducing the emission of CO2. In post-combustion carbon capture, the CO2 is captured from flue gas which is produced via combustion of fuel such as natural gas or coal.
The end-use segment is further classified into oil & gas, power generation, iron & steel, chemical & petrochemical, cement, and others. Among these, the oil & gas sub-segment is estimated to account for dominant market share and shall surpass $2,917.6 million by 2028, with an increase from $1,075.8 million in 2020. The CCUSS technology can traditionally reduce the emissions from oil & gas sector towards net zero emissions. The carbon capture, utilization, and storage technology provides an opportunity to the oil & gas exporters to monetize their business sustainably and to achieve net-zero emissions. In oil & gas sector, the captured CO2 can be used for enhanced oil recovery and for the manufacturing of fuels and in building materials.
The carbon capture, utilization, and storage market for the North America region is projected to acquire dominant market share during the forecast period. This region’s market generated a revenue of $807.1 million in 2020 and is projected to reach up to $2,272.9 million by 2028. North America leads the world in the carbon capture, utilization, and storage projects. For instance, as stated on April 24, 2020, the U.S. Department of Energy, established in 1977, announced $131 million investment in various CCUS projects and related activities such as research & development. In addition, in the U.S., tax credit known as Section 45Q was expanded in 2018, to provide significant boost to the CCUS investment plans. For instance, the California Resources Corp., the company engaged in the hydrocarbon exploration in California, has plans to remove the carbon dioxide emissions from the Elk Hills Power Plant which will be utilized for enhanced oil recovery process. This project is currently under development and is estimated to begin its operations in 2024. Also, it is estimated to remove 1.5 million metric tons of CO2 annually.
Key Players in the Global Carbon Capture, Utilization, and Storage Market
Some of the leading carbon capture, utilization, and storage market players are
- Royal Dutch Shell plc
- Fluor Corporation
- Mitsubishi Heavy Industries, Ltd.
- Linde plc
- Exxon Mobil Corporation
- JGC Holdings Corporation
- Schlumberger Limited
- Aker Solutions
- Honeywell International Inc.
Along with the company profiles of the key players in the market, the report includes the Porter’s five forces model that gives deep insights into the competitive environment of the market.
Porter’s Five Forces Analysis for the Global Carbon Capture, Utilization, and Storage Market:
- Bargaining Power of Suppliers: The carbon capture, utilization, and storage manufacturers largely depend on raw material suppliers for the supply of equipment required for setting up of CCUS plant that facilitates net zero carbon emissions. But various government investments and funding in CCUS projects reduce the cost associated with these equipment.
Thus, the bargaining power of suppliers is moderate.
- Bargaining Power of Buyers: In this market, the concentration of buyers is increasing steadily as well as the buyers are eligible for various tax credits, subsidies, and funding required for setting up CCUS plant.
Thus, buyer’s bargaining power will be moderate.
- Threat of New Entrants: The threat of new entrants is moderate owing to significant investment cost involved CCUS projects. Also, these projects largely depend on the government investments and funding.
Thus, the threat of the new entrants is moderate.
- Threat of Substitutes: The growing popularity of alternative renewable energy sources and its adoption are estimated to increase the threat from substitution. This is because CCUS projects are majorly deployed in oil & gas sector where energy is generated from non-renewable sources such as coil, oil, and natural gas.
Thus, the threat of substitutes is moderate.
- Competitive Rivalry in the Market: The carbon capture, utilization, and storage market players are focusing on partnerships and new project developments as well as increasing their carbon dioxide capture, utilization, and storage capacity.
Therefore, competitive rivalry in the market is moderate.