Approximately seventy percent of global carbon emission comes from the energy sector. 

Meanwhile, International Energy Agency (IEA) forecasts that energy demand will continue to rise for about 60 percent, in the next twenty or thirty years. On the other hand, there are growing commitments and urgency to decrease greenhouse emission in the global stage.

Among many technological advances which is expected to be one of solutions in mitigating climate impacts, specifically in the energy sector, is the implementation of Carbon Capture and Storage (CCS) technology. Generally, academic world and private sector have started to accept the potential impact from deploying said technology. This article will try to elaborate on the potential on benefit, implementation, as well as the development of CCS technology in the years to come.

Defining CCS Technology

CCS technology is one of the few methods of absorbing carbon dioxide coming from industrial activity or power plants. Instead of being released to the atmosphere, the carbon emission from these activities would be captured, transported, and stored below the ground. There are several location that has the potential to be the place of storing carbon, such as former oil and gas reservoir, deep saline formations, and coal beds.

It is expected that this technology could absorb more than 90% of industrial activities’ emission, and has become one of the few technologies that could facilitate the decarbonization of emission-intensive industry. In other words, this technology is considered an effective method in mitigating the impacts of climate change. 

Implementation of CCS Technology To This Date

Data from IEA shows that in 2022 there are 35 CCS facilities all around the world, with capacity to absorb emission equals to 45 million tCO2e per annum. IEA also notes that approximately 300 CCS projects are being developed all around the world. Even with this number, IEA projects that the world still need to deploy more CCS technology facilities to achieve the Net Zero Scenario.

In Indonesia, private sector has started to embrace the potential of CCS technology.

One of the leading State Owned Enterprises (SOE) in the oil industry in Indonesia has planned to implement CCS technology through carbon dioxide injection project in Central Java. In addition to opening new business opportunities, this technology would be utilized to optimize natural oil production. This project would also ensure the oil extraction process would be conducted efficiently and comply with sustainability principles.

The implementation of CCS technology in Indonesia would be explored further, considering several studies pointed out that there are several significant storage potential in the archipelago.

What’s the trend of CCS in the future? 

In the future, improving the effectivity of CCS technology requires a few strategic approached.

In terms of the financial side, implementation of CCS would still require a great support, both from the private and public sector. Naturally, this is due to the deployment of CCS technology which require a very considerable amount of capital. In accordance with the development of green investment which has been gaining traction in the last few years, a refined sustainability-related taxonomy would be a crucial feature. Such clear guideline would help investors in making a strategic investment decision that create a tangible impact on the economy, social, and environment. It is expected that investing in CCS technology would do just that.

CCS would also achieve a far greater effectiveness when it is deployed in conjunction with hard to abate industries. The industries included in this category include cement, iron and steel, as well as chemicals.

In the space of the carbon market, the implementation of CCS could also play a key role, bearing in mind the emission reduced by this technology would be considered as removal. Naturally, this could increase the integrity of a project, and drive the premium of the credits traded in the market. That said, there is still a long way to go, specifically in creating a rigorous standard fit to the CCS technology. At the end of the day, CCS technology has an enormous potential able to be leveraged in the carbon market.

With significant reduction in greenhouse gas emissions to address the ongoing climate emergency and achieve net-zero goals by 2050, CCUS technology is crucial for climate change mitigation, particularly during the transition to renewable energy sources. Successful CCS demonstrations should be a compelling evidence that the technology does work in the fight agains climate change.

In the future, it also within CarbonX’s plan to include carbon capture project into its investment portoflio.