The need to reduce greenhouse gas (GHG) emissions is essential as the effects of climate change are increasingly felt through more intense storms, wildfires, and flooding. Some strategies to do this included switching to electric vehicles, installing solar panels, and reducing deforestation.
Almost 0.01 Mt CO2 is currently being captured by 18 direct air capture plants that are already in operation across the world, and a 1 Mt CO2 plant is currently under construction in the US. Direct air collection is scaled up under the Net Zero Emissions by 2050 Scenario to capture about 60 Mt CO2 per year by 2030. This level of deployment is feasible, but several additional large-scale demonstration facilities will be needed to improve the technology and lower capture costs.
Cost of Direct Air Capture
While the major DAC technology firms’ cost estimates range from $95 to $230 per tCO2 for L-DAC and $100 to $600 per tCO2 for S-DAC. Several factors, including determining the actual DAC price
- Energy source,
- Carbon price
- DAC deployment scale
CAPEX (capital investment) for DAC plant -The geographical cost is impacted by all of these variables. Regionally speaking, China, the Middle East, Russia, and North Africa have cheaper CAPEX than Europe and the US. This is a result of the less expensive materials and gas in those regions of the world. As opposed to other locations, the cost of CO2 will be higher in Europe, the US, and Japan (up to $250/tCO2).
However, DAC prices will most likely decrease by 31-43% from 2020 to 2030 and by 10–24% from 2030 to 2050. This is because DAC has a significant capacity for cost reduction. With a carbon price of USD 250/tCO2, DAC will be viable in every region in 2050. A DAC plant generates electricity at that time using heat and renewable energy. In a global DAC scale deployment, the CAPEX cost in line with the Net Zero scenario can decrease to 49-65% lower in 2030 and 65-80% lower in 2050.
Top 3 Direct Air Capture Companies:
- Climeworks: Zurich-based company, founded in 2009 as a spin-off from the research university ETH Zurich, Climeworks is a DAC firm. The company employs S-DAC along with a robust CO2 absorber filter. It has built a total of 15 DAC plants around the world so yet. It invested $15 million in Iceland’s Orca DAC facility, which pumps CO2 deep underground for long-term storage after sucking it out from the atmosphere.
- Carbon Engineering (CE): Vancouver-based Carbon Engineering Ltd. has a direct air capture pilot plant that was also founded in 2009. It aims to build a DAC plant capable of capturing 1 million tons of CO2 a year in 2024. CE’s DAC technology sucks in atmospheric air with a fan. CE started its pre-FEED (front-end engineering and design) with Pale Blue Dot Energy on the development of a DAC plant in Scotland, U.K.
- Global Thermostat: This DAC business was established in the US. Global Thermostat (GT), like Climeworks, uses its unique solid sorbent material to trap CO2. GT has already put two DAC pilot plants into operation. ExxonMobil and it are actively working together to enhance and scale up their DAC technology. Additionally, the Haru Oni fuels pilot facility in Chile received its DAC equipment from this company. Synthetic gasoline will be created at this DAC facility using hydrogen and CO2 that have been collected. Up to 250 kg of CO2 every hour, or around 2,000 tCO2 per year, will be captured by the project.
Contributions To DAC Technology
More policy support and investment are being made in DAC technologies as a result of their growing recognition as a CDR strategy to reduce emissions. Nearly $4 billion in public funding has been allocated since the year 2020 for DAC research, development, and deployment (RD&D)
In April this year, five of the world’s biggest companies committed to investing $925 million in CDR technologies. Stripe, Alphabet, Shopify, Meta, and McKinsey provide the funding for it. Shopify is also supporting DAC through its Sustainability Fund. So far, Climeworks raised $650 million in equity funding to scale up its DAC technology. Further support for DAC comes from programs like the XPRIZE (offering up to $100 million for innovative carbon removal projects including DAC).
Direct Air Capture As Essential Component Of Climate Solution Portfolio
Climate models are making it more and more obvious that significant reductions in emissions and the removal of carbon dioxide will likely be required. To achieve national and international climate objectives, A variety of strategies will be needed on large scale. By investing in DAC now, you can lower expenses.