Summary

One essential component of maintaining a safe, stable climate is a global transition to a net-zero carbon dioxide (CO₂) emissions system, with no new net accumulation of CO₂ in the atmosphere. In 2019, CO₂ emissions in the United States totaled 5.26 gigatonnes (Gt), out of a total of 33.4 Gt CO₂ emissions globally. Among the highest priority actions to mitigate these emissions are decarbonizing the electric grid and transitioning energy end uses to decarbonized electricity, which will eliminate the majority of sources of emissions from fossil-fuel combustion. This long-term transition to net-zero emissions likely will eliminate the largest current uses of carbon-based products and processes, such as gasoline or diesel fuel for light-duty transportation and natural gas for heating in residential and commercial buildings. Mitigation of the remaining CO₂ emissions will occur via a number of different strategies, collectively termed carbon management. Large volumes of CO₂ will require long-term removal from the atmosphere, for instance, by storage in geologic formations underground or by sequestration in durable, long-lived products such as concrete, aggregates, some polymers, and nanostructured forms of carbon, such as carbon fiber. Short-lived carbon-based products, including fuels for some heavy-duty transportation applications, some polymers, and commodity chemicals, still will be needed and will have to be produced and used in a circular manner with no net emissions on a life cycle basis. Currently, the vast majority of embodied carbon in chemicals and materials (84 percent globally in 2020) is fossil derived, but in a circular carbon economy, this fossil carbon will need to be replaced with sustainable carbon from waste plastics and other carbon-based products, biomass-based carbon feedstocks, and CO₂. This report focuses on CO₂ utilization, in which CO₂ captured from flue gas streams, the atmosphere, or bodies of water is chemically transformed into a marketable product. The positioning of CO₂ utilization within the larger carbon management objective is illustrated in Figure S-1.

In the Energy Act of 2020, the U.S. Congress mandated that the U.S. Department of Energy (DOE) contract with the National Academies of Sciences, Engineering, and Medicine to analyze opportunities and challenges to advance CO₂ utilization technologies, develop the associated infrastructure, and establish markets for CO₂-derived products, considering a future in which carbon wastes participate in a circular carbon economy. For this first of two reports from the study, the committee was tasked with assessing the state of the infrastructure for CO₂ transportation, use, and storage as of early 2022 and identifying priority opportunities to improve and expand on that infrastructure to enable future CO₂ utilization development. The following paragraphs summarize the committee’s approach to the study and its main findings, conclusions, and recommendations.

The committee first identified existing infrastructure for CO₂ capture, transport, conversion, and geologic storage, as well as infrastructure for enablers of CO₂ utilization processes such as clean electricity, clean hydrogen, water, land use, and energy storage. The largest volume chemical utilization of CO₂ today is in urea synthesis; other products made on an industrial scale from CO₂ include organic carbonates, methanol, salicylic acid, and inorganic carbonates embedded in concrete. Pilot-scale efforts are under way to generate additional products from CO₂; however, the inherently higher energy requirements to use CO₂ as a feedstock in place of fossil carbon for hydrocarbon-based products and the lack of incentives to produce net-zero-emission products currently limit commercialization opportunities for CO₂ utilization. Furthermore, the committee found limited opportunities to leverage current CO₂ capture and transport infrastructure for future CO₂ utilization projects, since the majority of the existing infrastructure has been developed for enhanced oil recovery (EOR) and connects geologic or fossil-based sources of CO₂ with depleted oil reservoirs, routes that generally do not align with sustainable CO₂ utilization opportunities in a net-zero-emissions future. Nonetheless, the infrastructure expected to be developed for CO₂ capture and geologic storage (CCS) over the next decade also may be able to serve utilization projects. Therefore, the committee recommends that CCS developers design flexibility into their project plans to allow some of the CO₂ captured to be directed to utilization facilities (Recommendation 6.2). Given that many CO₂ utilization processes require significant amounts of clean electricity, clean hydrogen, and water, project developers also will need to consider the availability and accessibility of these inputs when designing CO₂ utilization infrastructure (Recommendations 4.4, 4.5, 4.6, and 6.3). DOE similarly should consider the availability and accessibility of geologic CO₂ storage, CO₂ transportation and product offtake infrastructure, clean electricity, and water when evaluating the design and siting of direct air capture and hydrogen hubs authorized in the Infrastructure Investment and Jobs Act (Recommendations 6.3 and 6.4).

To assess opportunities and challenges for future CO₂ utilization infrastructure development, the committee identified priority products that could be synthesized from CO₂ in a future circular carbon economy, separating these products into two classes, or “tracks,” distinguished by their lifetime, and hence their ability to sequester carbon for long periods, as illustrated in Figure S-2. Track 1 products, with lifetimes greater than 100 years,¹ include concrete, aggregates, some polymers, and solid carbon materials that durably store CO₂. Track 2 products, with lifetimes less than 100 years, include chemicals, some polymers, and fuels that decay to CO₂ and re-emit it to the atmosphere on relatively short timescales, unable to store carbon for long periods. Importantly, these Track 1 and Track 2 products have different requirements for sustainable production consistent with net-zero-emissions goals. Track 1 products derived from non-fossil CO₂ sources, such as direct air capture or biogenic carbon, are net-negative-emissions compatible, while those derived from fossil CO₂ point sources are net-zero-emissions compatible. On the other hand, Track 2 products must be derived from non-fossil CO₂ sources to be net-zero-emissions compatible. In addition to considering the CO₂ source, assessments of net-negative- or net-zero-emissions compatibility require taking into account emissions associated with all other inputs (e.g., electricity, hydrogen, and heat), processes, product fates, and any co-products or waste generated. Such sustainability considerations influence the type and location of infrastructure, as discussed further below.

When developing infrastructure for CO₂ utilization, the entire value chain of CO₂ capture, purification, transportation, and conversion needs to be considered. Commercial technologies exist for purifying CO₂ to achieve the different requirements for capture, transport, utilization, and storage, but add cost to CO₂ utilization processes. Mineralization and biological CO₂ conversion are the most resilient to impurities of the CO₂ feedstock, and catalytic electro- and thermochemical CO₂ conversion are the most sensitive. Once captured (and purified, if required), CO₂ can be transported by a variety of means including pipeline, rail, truck, ship, and barge. In many cases, some combination of these transportation methods will be required. Multimodal transport infrastructure will be particularly beneficial for connecting small-scale emitters and capturers located far from main pipelines with larger industrial hubs containing utilization facilities, and for connecting large- or small-scale emitters and capturers with distributed small-scale users (e.g., concrete manufacturers). When accessible, CO₂ pipelines are the most cost-effective transportation option, as they can move the largest volumes of CO₂ and therefore benefit from

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¹ The 100-year lifetime is chosen as the cutoff between Track 1 and Track 2 products to align with the United Nations Framework Convention on Climate Change.

economies of scale. Of paramount importance in any transportation scenario is safety; the primary risks from CO₂ are physical damage due to rupture of pressurized equipment and asphyxiation. There is a considerable level of understanding regarding the risks associated with pipeline transportation of CO₂, both dense-phase and gaseous. One option under consideration for CO₂ transport is to repurpose natural gas pipelines, which could simplify acquisition of rights-of-way and potentially decrease capital costs. However, pipeline integrity and operational issues make this challenging. Each individual project would require rigorous techno-economic and cost-benefit analyses to determine its feasibility.

Infrastructure development decisions for CO₂ utilization depend not only on CO₂ capture, purification, and transportation requirements but also on the availability of enabling infrastructure for inputs such as clean electricity, clean hydrogen, and water and for transportation of the CO₂-derived product. Many CO₂ utilization processes require significant amounts of clean electricity and clean hydrogen. Increases in demand for zero-carbon-emissions electricity, including that required for CO₂ utilization, will influence transmission and distribution planning and load management. In the long term, post-2050, it is expected that the grid will need to accommodate all power demand with a reliable supply of net-zero-emissions electricity for all users, but in the short term, CO₂ utilization processes may require deployment of clean power generation and energy storage to enable the 24/7 operation likely required for economic viability. Given the complexities of transporting and storing hydrogen, the committee

recommends that project designers co-locate facilities for hydrogen production and CO₂ utilization when feasible (Recommendation 4.5). Another required input for some CO₂ utilization processes is water. Though not expected to have a significant impact on water demand at a national scale, water requirements for CO₂ utilization could put stress on local water resources. Water will be an input to biological and chemical utilization processes, as a reaction medium, a reactant, or for process cooling. The committee therefore recommends siting CO₂ utilization facilities near a sustainable water source to support both short- and long-term needs and analyzing the effect of CO₂ utilization and the required enabling inputs (e.g., hydrogen) on local water demands, taking into consideration local environmental and justice impacts (Recommendation 4.6). Some CO₂ utilization processes, such as concrete production and biological CO₂ conversion to alcohols and hydrocarbons, are well suited for small-scale, distributed operations, with co-located CO₂ capture and conversion followed by transport of the CO₂-derived product. Optimizing the CO₂ transportation network to meet the needs of different utilization processes requires a systems-level analysis considering technological, environmental, economic, and societal factors (Recommendation 6.5).

In addition to developing technology and infrastructure, enabling and expanding CO₂ utilization requires consideration of policies, regulations, equity, and environmental justice. The most effective and efficient policies to enable CO₂ utilization would ensure that externalities from greenhouse gas emissions from all sources are captured in the full cost of using the technology and incentivize knowledge creation and reduce costs and risks for early adopters rather than subsidize specific technologies. In all cases, policies should support the CO₂ utilization industry toward societal goals, such as net-zero emissions, in a technology-agnostic manner. Policy makers should also take care that the policy regime does not create perverse incentives or excessively difficult regulatory environments (Recommendation 5.1). Establishing policies that overly incentivize CO₂ capture, for example, may create an unwanted incentive to produce emissions. Navigating the requirements to obtain permits from many different entities or managing the uncertainty in policy stability over the long term may decrease or deter investments in CO₂ utilization. The committee recommends that a single entity be responsible for guiding CO₂ utilization project developers through the permitting process, given the large number of organizations involved in granting permissions (Recommendation 5.4). Finally, the committee recognizes that widespread deployment of CO₂ utilization may have significant environmental, economic, and societal impacts. Total costs and benefits to society and their distribution should be assessed for each individual project using cost-benefit analyses. In particular, the equity and justice implications of CO₂ utilization projects should be examined and addressed. Furthermore, CO₂ utilization projects should involve early and sustained community engagement and address inequality, which may include terminating a project that does not receive local buy-in or for which regulators determine that the equity implications are unacceptable (Recommendation 5.6).

Given all of the above considerations, the committee identified two primary near-term opportunities for CO₂ utilization infrastructure investment: (1) using CO₂ sourced from bioethanol plants to make sustainable synthetic aviation fuel and (2) mineralization using fossil or non-fossil CO₂ sources to generate aggregates for construction materials, including concrete. In both cases, locating the CO₂ utilization operation in close proximity to enabling infrastructure (e.g., clean electricity and clean hydrogen) could prove cost-effective. While the committee deemed these two opportunities to be priorities in the near term given current knowledge and technologies and their potential scale of deployment, they are by no means the only promising CO₂ utilization opportunities. Consequently, and recognizing that infrastructure to capture and transport CO₂ for storage will likely be developed over the next decade, the committee recommends designing flexibility into that infrastructure such that it could be used to meet longer-term CO₂ utilization needs (Recommendation 6.2). One example would be developing industrial clusters that co-locate capture, utilization, and storage of CO₂ and incorporate relevant industries such as hydrogen production, chemical and fuel manufacturing, and low-carbon power generation. Specifically, the committee recommends that the Department of Energy consider co-locating at least one each of the hydrogen and direct air capture hubs authorized in the Infrastructure Investment and Jobs Act of 2021 (Recommendation 6.4). The best deployment and investment opportunities for CO₂ utilization should be identified using techno-economic, life cycle, and integrated systems analyses, while considering relevant regulatory and policy frameworks and factors that may influence societal acceptance via cost-benefit analyses (Recommendation 6.1). All infrastructure siting and development decisions should include best practices for substantive community engagement to ensure equitable outcomes.

Net-zero or net-negative CO₂ utilization can support the decarbonization transition by providing pathways for sustainable synthesis of carbon-based chemicals and materials in products, and carbon storage in durable, Track 1 products. However, few commercial examples of companies making net-zero or net-negative products via CO₂ utilization exist today, and for CO₂ utilization to meet its potential will require overcoming limitations and challenges related to technologies, processes, infrastructure, and business opportunities. These limitations and challenges include inherent inefficiencies that result in high costs; needs for discovery of and improvement in processes and technologies; requirements for large amounts of additional inputs, such as land, hydrogen, water, and electricity; elimination of the emissions associated with the entire life cycle of a CO₂ utilization process and product; limited existing CO₂ infrastructure; and societal concerns about infrastructure deployment, especially from environmental justice communities. Considering these challenges and opportunities, this report evaluates near-term needs for CO₂ utilization to play a role in a net-zero future.