Carbon Capture and Utilization in the Industrial Sector

Carbon Capture and Utilization in the Industrial Sector

By Peter C. Psarras, Stephen D. Comello, Praveen Bains, Panunya Charoensawadpong, Stefan J. Reichelstein, Jennifer Wilcox
August 2017Working Paper No. 3493

The fabrication and manufacturing of industrial commodities such as iron, glass and cement is carbon-intensive. A major reason capture of carbon dioxide from flue gases of industrial processes has not been widely adopted as a climate mitigation strategy is due to the lack of economic incentives for capturing CO2 on a scale that will impact climate. Yet, abatement opportunities do exist for the industrial sector, provided the scale of such processes is aligned well with CO2 utilization. This is important given that this sector accounts for 23% of total global emissions. This work develops a model that examines the full cost of separating, compressing and transporting CO2 of various industrial processes (sources), and pairing them with appropriate utilization opportunities (sinks). We find that – given the relatively higher concentrations of CO2 in flue gases from industrial processes – the full cost of abatement is lower than that of the power sector. Further, we find truck transportation is generally the low-cost alternative compared to pipeline transport for small volumes indicative of this kind of capture activity (100 kt CO2/a). We apply this methodology to a regional case study, which shows steel and cement manufacturing as having the lowest levelized cost of abatement.