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- Carbon Capture & Energy Storage in 2023
Demain Industry Reports:
Your Guide to Market Insights
⚡ Overview of Energy Storage
Recent news regarding energy storage include the launch of the Energy Storage Solutions Consortium to quantify the emissions benefits of grid-connected energy storage projects, the EU's plan to raise €140B from a 33% windfall tax on energy firms' surplus profits, and the success of the Merge but the stranded mining rigs. Additionally, China is investing $87B to construct 60 GW of nuclear, offshore wind, pumped hydro, and virtual power plants, and Topsoe and First Ammonia signed an agreement for 500 MW of solid oxide electrolyzer cells.
🌲 Overview of Carbon Capture
The key activities regarding Carbon Capture include: developing pickaxe technologies and materials to improve the economics of CCS projects; driving initial demand for high quality permanent carbon removal solutions; utilizing tax credits and a price on carbon to enable nascent technologies to get off the ground; exploring the capture of carbon dioxide; investing in carbon negative companies and projects; and examining the financial risks of climate change.
🗞️ News Summary on Energy Storage 2023
Recent news regarding energy storage has focused on the five most promising long-duration energy storage technologies. These technologies are being developed to store energy for longer periods of time, allowing for more efficient use of energy. The five most promising technologies are lithium-ion batteries, flow batteries, compressed air energy storage, pumped hydro storage, and thermal storage. Lithium-ion batteries are the most widely used technology, but they are expensive and have limited capacity. Flow batteries are cheaper and have higher capacity, but they are not as widely used. Compressed air energy storage is a relatively new technology that uses air pressure to store energy, and it is becoming increasingly popular. Pumped hydro storage is a more established technology that uses water to store energy, and it is the most cost-effective option. Finally, thermal storage companies are using cheap, clean power early in the day to freeze ice, which is melted down later in the day to cool buildings when power’s pricier.
The proposed EPA rule would be the first to limit emissions from existing coal- and gas-fired power plants, which are responsible for 25% of US greenhouse gas emissions. It would require drastic cuts to emissions beginning in 2030, though it does not mandate a specific reduction strategy. Power plant operators could take several approaches to comply, such as running plants less often, switching to green hydrogen, or installing carbon capture, utilization, and storage (CCUS) tech. The rule is likely to face pushback and legal challenges, and some say it does not go far enough to reach Biden's goal of a 100% carbon-free power grid by 2035. Utilities and power plant operators warn of reliability issues, and the rule does not cover smaller gas plants, which could lead to more pollution closer to Americans' backyards.
In addition to the development of these technologies, there has also been news regarding Shell's recent acquisition of Volta, which is seen as the beginning of a potential M&A boom for Green SPACs. This could lead to more investments in green technologies, including energy storage.
🗞️ News Summary on Carbon Capture in 2023
Recently, there has been a surge of news regarding Carbon Capture, Utilization, and Storage (CCUS). This is due to the need to reduce existing atmospheric CO2 levels, which have reached 417ppm. To put this in perspective, 10 to 15 gigatons or 10,000M to 15,000M CO2 tonnes per year need to be removed by 2050 just to keep below two degrees.
Incentives such as the 45Q tax credit and recent stimulus bill incentives have helped to drive the development of carbon capture technologies. Corporates have also started to invest in carbon negative companies and projects, such as Microsoft, Amazon, Stripe, Shopify, and Occidental Petroleum. Additionally, United Airlines has joined 1PointFive to make essential DAC infrastructure, including engineering the world’s largest DAC plant in Texas to capture 1M tons of CO2 annually.
The differences between DAC (Direct Air Capture) and other carbon capture methods are also being explored. DAC infrastructure has the potential to capture large amounts of CO2, and the 45Q carbon credits are currently going for $50 per sequestered ton, more than double a decade ago.
Startups are also developing the pickaxe technologies and materials to improve the economics of CCS projects. Liquid solvents are the most mature technology, with novel startups starting to employ solid sorbent technologies.
In order to drive down the cost of carbon capture, government action such as tax credits and a price on carbon is needed to enable nascent technologies to get off the ground. Corporates must also drive initial demand for high quality permanent carbon removal solutions.
Finally, Janet Yellen, the Treasury secretary nominee and former Fed chair, has pledged to create a team focused on examining the financial risks that climate change poses.
