The International Energy Agency (IEA) recently released a report on “Direct Air Capture” which highlights the increasing significance of Direct Air Capture (DAC) technology in achieving net zero pathways. Capturing carbon dioxide directly from the air and permanently sequestering it not only reduces atmospheric CO2 but also provides a solution for residual emissions while serving as a negative emissions technology to balance unavoidable carbon emissions. Furthermore, the captured CO2 can also be used as a “climate-neutral” raw material for product manufacturing.
1. Basic Principles of DAC Technology
The IEA report indicates that current DAC technologies include solid DAC and liquid DAC.
Solid DAC technology uses solid adsorbent filters to chemically bond with carbon dioxide. The process involves drawing air into the collector, where CO2 attaches to the surface of the solid adsorbent filter. When the filter is saturated, the collector is closed and heated, allowing the released CO2 to be captured for storage or use. The liquid system, on the other hand, allows air to contact a chemical solution (such as hydroxide solution) to remove CO2 from the air based on the solution’s properties, with the remaining air being expelled back into the atmosphere.
2. Growth Momentum of DAC
The report notes that the number of DAC facilities has been increasing in recent years. Currently, there are 18 operational DAC projects worldwide, located in Canada, Europe, and the United States, with 16 of these projects selling the captured CO2. The world’s largest DAC project began operations in Iceland in September 2021, capable of capturing 4,000 tons of CO2 annually for storage. This project stores CO2 through mineralization, mixing the CO2 captured from the air with CO2 captured from geothermal fluids, injecting it into basalt formations for underground storage, and converting the CO2 into minerals through the mineralization process. Additionally, a large DAC project with a capture capacity of 1 million tons per year is under construction in the U.S., expected to be operational by 2025.
According to IEA statistics, since the beginning of 2020, governments have pledged nearly $4 billion specifically for the development and deployment of DAC. In 2021, the U.S. committed $3.5 billion to establish four DAC centers, launching a DAC incentive program providing $100 million for commercial-scale projects and $15 million for pre-commercial projects. The UK has allocated £100 million (approximately $137 million) for carbon dioxide removal (CDR) development, including DAC projects. Meanwhile, Australia, Canada, Europe, and other regions have also introduced funding schemes to support DAC development and deployment.
Private sector investment is also on the rise. Since early 2020, leading DAC companies have raised approximately $125 million in funding, with companies like Microsoft, Stripe, and United Airlines investing in DAC facilities and purchasing DAC-based carbon removal technologies. Additionally, DAC is one of four key technologies in the Breakthrough Energy Catalyst initiative (established by Bill Gates and a coalition of private investors), which will receive $1.5 billion in investments. DAC also aligns with the technical direction of the XPRIZE Carbon Removal project announced in 2021, managed by the XPRIZE Foundation and funded by Elon Musk through the Musk Foundation, with a total prize of $100 million.
3. High Costs, But Declining Trend
Due to the lower concentration of CO2 in the atmosphere compared to emissions from power plants or cement factories, the cost of capturing CO2 from the air is evidently higher. The cost of DAC depends on the capture technology (solid or liquid-based), energy costs (thermal and electric prices), financial assumptions, specific plant configurations, and whether the captured CO2 is stored or utilized. The IEA estimates that the cost of capturing CO2 for large-scale DAC applications (capturing 1 million tons of CO2 annually) is between $125 and $335 per ton. Through deployment and innovation, capture costs could potentially drop below $100 per ton. The Middle East, China, Europe, North Africa, and the U.S. may emerge as regions with the lowest DAC deployment costs. However, the decline in costs largely depends on support from both the public and private sectors for innovation and deployment.
4. Establishing Internationally Recognized DAC Certification and Accounting Methods
The report emphasizes the importance of establishing agreed-upon methods and accounting frameworks based on lifecycle assessment (LCA) for DAC and other CDR methods to support their inclusion in regulated carbon markets and national inventories. Notably, the latest guidelines from the Intergovernmental Panel on Climate Change (IPCC) for national greenhouse gas inventories do not include accounting methods for DAC, meaning that emissions reductions associated with DAC will not count towards international emission reduction targets under the United Nations Framework Convention on Climate Change (UNFCCC). Currently, stakeholders are working to develop robust accounting and certification methods for DAC and other CDR methods, including through the Mission Innovation CDR Mission initiative launched at COP26.
5. Accelerating the Deployment of DAC Projects
In the IEA’s scenario for achieving net zero emissions by 2050, DAC technology needs to capture over 85 million tons of CO2 by 2030 and approximately 980 million tons by 2050. Therefore, the IEA report suggests that to achieve net zero goals, there is a need to accelerate the scale of capture from the current nearly 10,000 tons of capture capacity to an average of 32 new large projects with a capacity of 1 million tons of CO2 per year by 2050. This will require increased support from both the public and private sectors to lower costs, improve technologies, and establish a market for DAC technologies.
For DAC deployment, the report proposes six priorities:
Firstly, prioritizing large-scale DAC demonstrations. Targeted policies and programs are needed for short-term demonstrations and deployments. Governments should ensure that planned projects can be smoothly operational and provide necessary experience for DAC technologies and supply chains.
Secondly, promoting innovation across the entire DAC value chain. Innovation is crucial for reducing manufacturing and operational costs, as well as the energy demand of DAC plants. Additionally, it is vital for providing clean energy for high-temperature heating and developing and lowering the costs of CO2 utilization applications, including synthetic aviation fuels.
Thirdly, increasing R&D for CO2 sequestration technologies. The potential for DAC to remove large amounts of CO2 from the atmosphere depends on the development of suitable geological sequestration technologies. Although the sequestration potential is immense, developing these resources can take up to a decade, and lengthy development times may hinder the scaling of DAC.
Fourthly, establishing internationally recognized DAC certification and accounting methods. Robust, transparent, and standardized international certification and accounting methods are needed for DAC to facilitate its recognition in carbon markets and IPCC greenhouse gas inventory reporting.
Fifthly, assessing the role of DAC and other carbon removal methods in net zero goals. Increasing understanding and communication about the expected roles of DAC and other carbon removal methods in net zero strategies will help identify technological, policy, and market demands at national and regional levels.
Lastly, strengthening international cooperation. Collaborating through international organizations and project initiatives such as the IEA, Clean Energy Ministerial, Mission Innovation, and the Greenhouse Gas R&D Technology Cooperation Program (GHGTCP/IEAGHG) can play a significant role in promoting knowledge sharing, reducing research duplication, and coordinating lifecycle assessment methods and DAC technology accounting methods.
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