Unlocking the potential of CCUS

By David Frans, Clément Audouin and Jonas Lehmann

As the industrialized world continues to fall short of critical commitments to rein in global warming, technologies originating from the 1970s oil and gas industry are emerging from their niche existence and, for the first time, attracting widespread attention. Our new in-depth report stakes out what the carbon capture, utilization and storage (CCUS) market involves and explains its significant potential as a powerful tool in efforts to curb climate change. We also investigate the many challenges that must be overcome to ramp up infrastructure and scale up a vibrant CCUS economy in Europe.

The compelling logic behind CCUS

The most common methods currently in use to drive decarbonization are helpful but clearly not sufficient. Ironically, however, some industries that generate the most carbon emissions remain indispensable if we are to build a low-carbon energy infrastructure at the required scale. For these sectors, there is currently no alternative to applying techniques that capture and, ideally, utilize (read: monetize ) the CO₂ emissions they cannot avoid generating.

The advent of free carbon allowances in Europe starting in 2026 will add serious economic rationale to this purely climate-based logic. Emissions trading prices in excess of EUR 150/ton of CO₂ should thus make investing in CCUS technologies a profitable proposition. As use cases spread beyond CCUS’ traditional roots in oil and gas, the market volume could ultimately rise as high as USD 1 trillion.

Anticipating the structure of this complex market, we break down carbon capture, utilization and storage into its component parts, spelling out the many individual aspects of the required infrastructure, the various supply chain steps and the different modes of (onshore and offshore) transport that will be needed.

What will Europe’s CCUS economy look like in the future?

Individual European countries and the EU as a whole are already putting in place the regulatory framework, financial systems and other incentives without which the CCUS economy cannot flourish and grow. At the same time, corporate players are on the verge of committing to major investment projects in this field.

We envisage two main phases of development in Europe’s nascent CCUS economy. And while our initial volume projections tend to be conservative, market growth beyond 2030 should be sizable indeed. We discuss in detail exactly how, where and when this expansion is likely to transpire.

A challenging path, but an optimistic mood

While the need for CCUS is clear and the prize potentially very lucrative, our insights indicate that substantial obstacles remain to be overcome if current projections are to become reality. Essentially, an entire industry infrastructure has to be built more or less from scratch. An assortment of economic and regulatory uncertainties have likewise yet to be clarified, alongside the scope of government backing and solutions to various technical issues.

We therefore examine how key stakeholders are already positioning themselves. What skills must they acquire? Which business models are best suited to different links in the CCUS value chain? What strategies will keep them in the running for the long haul? With practical considerations and recommendations for would-be market participants conclude the full report, which you can download below.

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