The UN Intergovernmental Panel on Climate Change (IPCC) state that limiting global warming to 1.5oC means the world needs to reach a net-zero status by 2050,i where emissions sources are balanced by emission sinks. Overshooting 1.5oC would result in significantly more biodiversity loss, more glacier-free Artic summers, and more frequent extreme weather events. Carbon emissions data, however, suggests that we are not making good progress. For example, CO2 emissions from fossil fuel combustion have increased every year since 2000 except 2009, 2015 and 2016, according to International Energy Agency (IEA) fossil fuel statistics.ii

    Carbon capture and storage (CCS) refers to technologies that remove carbon from the atmosphere and safely store it back in the ground. The IEA estimates that CCS could support 7 per cent of the emissions savings required to comply with the Paris Agreement.iii In pathways towards carbon neutrality, CCS is mainly used to address emissions from the share of the power sector not yet converted to renewables. It is also beneficial for industrials, which account for about 25 per cent of total energy-related and process CO2 emissions.iv For these hard-to-abate sectors like cement, chemicals, and steel, CCS can enable a net zero carbon outcome by addressing emissions cuts not covered by cleaner fuels or energy efficiency.

    Despite these climate gains, CCS technology is far from widespread. The IEA estimates that roughly 2,000 CCS facilities are necessary by 2040 to comply with Paris Agreement goals.v Today, only 19 facilities are in operation.vi As a report on Lending to Low Carbon Technologies produced for HSBC by researchers from Imperial College London points out, whilst CCS is technically ready for widespread deployment, it is not yet commercially viable.

    A handful of countries, such as the United States, the United Kingdom, and China have made support available to enable the uptake of CCS, including tax credits and government funding to lower the costs of CCS facilities.vii As with renewables when they were in early stages of deployment, targeted public funding would help accelerate the market for CCS.

    i Intergovernmental Panel on Climate Change. 2018. Special Report. Global Warming of 1.5oC. Summary for Policymakers
    ii International Energy Agency. CO2 Emissions Statistics
    iii International Energy Agency. Carbon capture, utilisation and storage. A critical tool in the climate energy toolbox
    iv Intergovernmental Panel on Climate Change. 2018. Special Report. Global Warming of 1.5oC. Chapter 2
    v International Energy Agency. Carbon capture, utilisation and storage. A critical tool in the climate energy toolbox
    vi Global Carbon Capture and Storage Institute
    vii Global Carbon Capture and Storage Institute, the Global Status of CCS, 2018 and UK Government press release: World-first carbon 'net-zero' hub of heavy industry to help UK seize global economic opportunities of clean growth. 13 December 2018