What’s It Really Like to Buy an Electric Vehicle?

Barbara Weber
January 24, 2023
Attendees at the 2021 LA Auto Show check out the Hyundai IONIQ 5. (Photo: David Ganske of DG+Design)

One of the most noteworthy statistics I took away from a recent webinar from the Zero Emission Transportation Association, was that 90% of electric car owners say once they’ve gone electric, they’ll never go back to a gas-powered vehicle. But what does it take to get someone to that point of purchase? To make the leap into first-time EV ownership? And how can EV car manufacturers ensure that a trip into the unknown is a positive one?

I sat down with two different individuals who have recently bought an EV for the first time to learn more about what the experience was really like. One, who works in tech and is a resident of Virginia, recently purchased a Tesla Model 3; an experience that was easier than she anticipated. The other, a teacher in Oregon, navigated the nuanced nature of EV incentives, timing, and availability to (finally) secure a Chevy Bolt.

Here’s what they had to say.

What prompted the need for a new car? And did you know you wanted an EV?

Tesla: I drive a lot with my work commute and felt like I was getting my older car (a used 2008 Lexus) serviced all the time. I knew my next car needed to be electric because I never wanted to go to the gas station again and a charging station was recently installed at my apartment complex and only costs $20 a month. 

Chevy Bolt: First, we realized that the solar panels on our home were overproducing compared to what we’re using (by 1200 kWh!). In Oregon, this extra power essentially just goes back to the grid and is of no benefit to us. We also knew we were getting closer to needing a new car and for us it was a big financial motivation to go electric because we could apply what we overproduce through our solar panels to power our vehicle. Between that, gas prices going through the roof, and multiple state and federal bills being passed to incentivize EV ownership, it was a no brainer. It also helped that our house was built with a plug-in station for an EV. Last, but certainly not least, I’m a science teacher and it's exciting to think we could be cutting down on our emissions with this decision.

What do you value in a car? In any large purchase?

Tesla: I want to feel good about it. I want to feel like I made the right decision and get reinforcements for that through my experience with the car.

Chevy Bolt: The value I’m getting. I don’t need named brands. I want a quality car at a reasonable price.

What was the biggest obstacle in purchasing your new EV?

Tesla: Purchasing the vehicle was more of a long term investment for me versus an immediate need to fill so I had the benefit of time to go through the motions.  Once I knew which vehicle I wanted, I needed to figure out whether to lease one or buy one, and in the case of the latter, how exactly that works. I found researching it online was not as easy as I (and I think most Americans) want everything to be. Ultimately when I decided to buy, picking a lender was the biggest obstacle, as interest rates were not favorable.

Chevy Bolt:  There were multiple challenges. For one, availability was a big issue. We had initially put a deposit down on a Nissan Leaf and after four months were told we couldn’t get the car as there weren’t any available. Then there was navigating the complexities of the various rebates and pricing structures. The price of the same car can change considerably depending on the state you’re buying it in.

In Oregon, where we’re residents, many dealers were raising the price upwards of $8,000 over MSRP because they knew many people would be using rebates. Luckily, the majority of sales people were honest about this, which prompted us to start looking outside of Oregon where dealers would be less inclined to raise the prices. It was a numbers game to figure out the best place to buy a car from and we had to do a lot of math. Between the laws continuously changing (and being variable by state) and rebates expiring or being maxed out, there was a lot to sort through. We eventually went with a dealer in Idaho who helped us find a car (the Chevy Bolt) that was both available and for sale at MSRP. By the time we bought our car, we had worked with multiple sales people and dealers across four states.

Where did you research your car options? Where do you get most of your information?

Tesla:  What got me really excited about purchasing an EV was attending the LA Auto Show earlier this year. They featured a lot of EVs and within one day I was able to explore multiple company’s offerings all in one place, from concept cars to ones that had been in the market for years. By the end of the show, I had narrowed down my top choices as the Hyundai Ioniq 5 and the Tesla Model 3. 

Following the LA Auto Show, I spent several months deciding between the two, as both were in the same price range and I wasn’t in a rush. Ultimately what it came down to was availability. I had seen the Hyundai Ioniq 5 at the show but there wasn’t an option to test drive it there, nor could I find it anywhere in my area. I ended up visiting a Tesla showroom near my apartment in Virginia and a helpful salesperson walked me through my options. 

Chevy Bolt: We started our search on a website called TrueCar where you can search based on pricing, whether it’s new or used,  and EV or ICE (internal combustion engine). We were able to narrow down our top choices as the Nissan Leaf or the Chevy Bolt, as they were the right size and price point for us. Through TrueCar we were connected with various dealers and I appreciated that everyone seemed to be really responsive, especially since it’s hard to track down an EV that’s actually available. 

After working with different dealers, we started going through Costco, whose dealers were great and helped us figure out how much we would pay in different states, could get us solid answers about when a car would actually be available, and verified that the salesmen we were working with were actually real people. 

What questions or concerns did you have about going electric? 

Tesla: Before my building installed a charging station, I was hesitant about getting an EV because I didn’t want to have to worry about the convenience of charging. That said, my sister and brother-in-law have had a Tesla for years and have never had a problem finding a charger in the two states they’ve lived in, so seeing the ease in that transition for them was helpful for me.

Chevy Bolt: Living in Bend, Oregon, my first thought was how it was going to do in the cold and snow. We will put snow tires on it but you don’t really see these cars doing very well in the snow. Additionally, I was concerned about the battery life and how it would hold up in the cold. I’ve heard from multiple owners of EVs that the trick is to let the battery run down and not plug it in every day. 

There are a lot of other unknowns, like how much it will cost me to “fill up” when I’m not charging at my house. I’m used to thinking about dollars per gallon and how many miles I go and have no idea what that will equate to in kWh. Also, I know there is an app out there that will help me as a new EV owner, but I haven’t looked into it yet.

How did you first become aware of the car you ultimately chose?

Tesla: The first time I became aware of Tesla overall was when the Model S first came out in a small batch. A friend from college bought one and was an early adopter.

Chevy Bolt:  We had initially opted to buy the Nissan Leaf after talking with multiple friends who own one, but once it became obvious availability was going to be an issue, we started looking for other EVs at similar price points. We learned about the Chevy Bolt through TrueCar and various dealers we worked with through that, and then asked friends who owned one how they liked theirs.

Did you ask for advice from anyone?

Tesla: Yes. My ultimate decision to buy when I did was based on a conversation with my brother-in-law David. He helped me realize the timing was right for many reasons, including 1) the price of a Tesla isn’t going down in any kind of substantial way anytime soon. 2) because I don’t qualify for the EV tax credit there was no reason to wait. 3) This is probably the highest offer I’ll get for a used car based on the market. 4) gas prices are still high. AND 5) The sooner I buy, the more I'll enjoy my commute to work more and sitting in DC traffic. It’s nice having a modern vehicle.

Chevy Bolt: Yes, we have friends who have both the Nissan Leaf and the Chevy Bolt, all of whom speak highly of both cars.

What was the most important criteria for your decision-making process?

Tesla:   In addition to availability (or lack thereof), size was important to me. I’m used to a compact car and I liked that the Tesla felt a bit smaller than the Ioniq 5. I didn’t need an SUV.

Other important criteria for me revolved around leasing and buying. The Tesla salesman in the showroom explained the resale value of an EV compared to an ICE car and this is what prompted me to purchase the car versus lease it. While interest rates had me initially concerned about purchasing it, he explained how a used Tesla Model 3 hasn’t depreciated in value much at all and they are tough to find. I knew that demand was likely to stay high so should I decide to sell my car in the future, it would be an easy thing to do. 

Another big selling point for me was the service component. When I was initially debating between leasing versus buying, I thought leasing would save me money on service. After speaking with the Tesla representative, I learned that very little service (if any) is needed on a Tesla and there is no need for oil changes or emissions checks.

Chevy Bolt: Value, price, and availability. It also needed to have a longer range as we road trip as a family often. It’s not a name brand like Tesla, but the Chevy Bolt was a good deal and fits the criteria we needed. I think there are a lot of manufacturers out there now who are making good EV options. 

Were there any deal breakers?

Tesla: The fact that I couldn’t even find a Hyundai Ioniq to test drive kind of sealed the deal. That, and I’m not sure when one would have been available. Also, I like that the Tesla is sportier.

Chevy Bolt:  Yes, the prices. After a dealer in Spokane, WA, wanted to charge us $10,000 more for the Nissan Leaf, we decided the Bolt was a very similar car and a better option. Brand isn’t as important to us as price. 

Have you received any sort of compensation/benefits for your purchase of an EV?

Tesla: No, I don’t qualify.

Chevy Bolt: Yes, we took advantage of all of the benefits we could, including the federal Bi-partisan Infrastructure Act ($3,000), Oregon Clean Air Act  ($2,500), a Costco rebate ($1,000), and a teacher discount ($500). And even though we bought the car in Idaho, we were able to show that we’re Oregon residents and avoid sales tax (as Oregon doesn’t have sales tax).

Did anything surprise you about the process (or the car itself)?

Tesla: During the process of buying it, it surprised me that, while the Tesla representatives knew a lot about Teslas, they didn’t seem to know a lot about cars in general. They also didn’t know anything about the tax credit. That said, I was happily surprised by how quickly I was able to secure a car. After I made a down payment, I was told the estimated delivery would be mid-January, but two weeks later the exact car I ordered was available. Beyond the initial trip to the dealer, everything happened on their app, which was a very different experience and had its pros and cons. For instance, Tesla actually bought back my old car and gave me a great deal on it and the whole process was done through their app. The downside of the app was that after the sale was made, I felt like I had to do a lot of work to get assistance from an actual human, which threw me off.

After I bought it, I was surprised that I have to be connected to Wifi in order to install software updates. I live in an apartment complex and can’t connect to Wifi in my car so I still haven’t figured out how to install things like a critical brake light update. You can pay Tesla to have Wifi in your car but I am trying to avoid having to pay them for everything. Speaking of which, I was really surprised that the car didn’t come with a charging cable (apparently they used to). A few days after buying my car, I pulled into the charging station in my complex and realized it did not provide a cable for charging, nor was one provided with my car. I ended up ordering one from Tesla for $250, that took a week to get to be delivered. The Tesla representatives didn’t advise me the car doesn’t come with a charging cable and their customer service leaves something to be desired.

Chevy Bolt: The difficulty in finding an available car in the first place. It really surprised me that we were able to pay a deposit and then not have the car ever become available. That said, it’s worth noting that what shocked me the most was that we were able to sell our old truck (a Honda Ridgeline with terrible gas mileage) for $5,000 more than we originally paid for it.

Would you go through the process again?

Tesla: Yes. I feel good about my purchase. I just wish it would have come with a charging cable.

Chevy Bolt: Yes. But…hopefully not for a long time.

Between the multitude of hybrid and electric vehicle incentives (in addition to the federal tax credits) and its quickly growing marketplace (a record $19.1 billion was announced in Q3 of 2022 for US EV manufacturing), EVs are sure to give traditional ICE vehicles a run for their money in 2023. While 2022 saw the unveiling of dozens of new EV options from major automakers such as Ford, General Motors, and Mercedes, it is projected that by 2025, there could be 74 different EV models offered in North America alone. From middle market SUVs and pickup trucks, to sedans and  high-end sports cars, there will be something for everyone.


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Carbon Capture, Utilization, and Storage - Big Growth Is Promising, But More Is Needed

Gavin Chisholm & Walter James

Key Takeaways: 

  • Today, 65% of carbon capture, utilization, and storage (CCUS) capacity is used to capture emissions from natural gas processing. 
  • By 2030, hydrogen production, power generation, and heat will be the largest sectoral applications for CCUS.
  • CCUS is set to grow globally, with North America and Europe poised for particularly rapid growth over the next decade. 
  • The vast majority of the captured carbon will be stored in permanent storage infrastructure by 2030, outpacing carbon use in enhanced oil recovery.
  • Expected CCUS capacity growth is still not sufficient to meet the IEA’s Net-Zero Emissions Scenario for 2050. Policymakers must enact measures from a wide range of policy and regulatory options available to them to further accelerate CCUS growth.


Driven by ambitious government emissions-reduction targets, a wide range of decarbonization strategies are underway all around the world, from renewable energy production to transportation electrification. Recently, however, a very different decarbonization approach has started to gain traction: carbon capture, utilization, and storage (CCUS). Instead of replacing a polluting product or process with one that does not produce emissions, CCUS technologies remove carbon dioxide (CO2) emitted from power plants and industrial processes, as well as directly from the atmosphere. The captured carbon can be stored (usually injected deep underground) or used for a wide range of applications, including the manufacturing of construction material, fertilizers, and bioplastics.

Despite its growing popularity, CCUS can be a controversial approach to climate change mitigation. Some opponents argue that developing CCUS technologies gives big emitters like fossil fuel companies a convenient excuse to keep extracting fossil fuels. Some observers also argue that relying too heavily on CCUS, rather than accelerating the use of emissions mitigation technologies, will not help the world meet crucial climate targets. 

Despite such skepticism about CCUS, a growing number of governments and firms are deploying CCUS as part of their decarbonization strategies. This is because while the rapid deployment of renewable energy remains the primary strategy for global carbon emission mitigation, even in the most generous of projections, renewables alone will not be enough to meet key climate targets. This is why authoritative projections like those by the Intergovernmental Panel on Climate Change and the International Energy Agency (IEA) also include the use of CCUS technologies.

In this article, we investigate the current state and future projections of the global CCUS landscape: What sectors are employing it, and how is the captured carbon used? How do we expect CCUS deployment to grow in the future? What policies and incentives are necessary for CCUS to reach its potential as a key pillar of a decarbonized society? 

To answer these questions, we analyzed the International Energy Agency’s (IEA) CCUS Projects Database. This database covers all CO2 capture, transport, storage, and utilization projects worldwide that have been commissioned since the 1970s and have an announced capacity of more than 100,000 tons per year (or 1,000 tons per year for direct air capture facilities).

Today’s Global CCUS Market

Natural Gas Processing Dominates Global CCUS Applications Today

For the sake of this analysis,  “sectoral application” refers to the industry in which CCUS is deployed to capture the emitted carbon before it is stored or transported for use. Broadly speaking, there are eight sectoral applications for CCUS technologies today: 

  1. Natural gas processing: CCUS is used to capture carbon emissions from purifying raw natural gas to produce pipeline quality natural gas.
  2. Hydrogen and ammonia production: Hydrogen is a molecule that does not emit carbon when combusted, and has the potential as a clean fuel for the industrial, transport, and power sectors. Ammonia can also be used as a zero-carbon fuel for power generation and a carrier for hydrogen. Yet most hydrogen and ammonia production today uses fossil fuels. CCUS offers a potential solution, as capturing the carbon emitted from hydrogen and ammonia production is a cheaper strategy than using renewable energy to produce these fuels in most regions.
  3. Biofuels: Facilities that produce biofuels like bioethanol, biodiesel, and biogas are also responsible for CO2 emissions, and carbon capture technologies can be used to remove these emissions. 
  4. Other fuel transformation: Carbon capture technology is used to sequester emissions from facilities that produce and refine fuels other than natural gas, hydrogen, ammonia and biofuels.
  5. Iron and steel plants: Some industrial processes, notably iron and steel manufacturing, are highly energy intensive and cannot easily be decarbonized. CCUS is one of the most promising emissions reduction methods for these facilities.
  6. Other industry: CCUS is applied to industrial facilities other than iron and steel, such as aluminum smelters, pulp and paper mills, etc.
  7. Power and heat generation: Power and heat generation account for about 30% of primary greenhouse gas emissions globally. Owners of fossil fuel power plants use CCUS to cut those emissions when power and heat are generated.
  8. Directly from the air: Through direct air capture (DAC), CO2 can be removed directly from the atmosphere.

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As the chart above shows, natural gas processing is the dominant of these eight CCUS applications; today, 65% of all CCUS capacity is in the natural gas processing sector. Natural gas processing plants in North America were the earliest adopters of CCUS in the 1970s and 1980s because of the relatively low cost of capturing carbon from these processes and the ability to supply it to local oil producers for oil recovery operations. 

Over the last two decades, carbon capture capacity in natural gas processing has increased by 265%, from 8.5 megatons (Mt) of CO2 per year in 2000 to over 31 Mt CO2 per year in 2022. This growth follows the steady increase in natural gas production globally. 

Other applications pale in comparison. 7.3 Mt CO2 per year is captured from other fuel transformation processes, 3.5 Mt CO2 from industrial plants other than iron and steel, and 1.6 Mt CO2 from the production of biofuels. The sectors where carbon capture technology will be essential in decarbonization efforts – power generation and heat, as well as iron and steel manufacturing – are still lagging behind at 1.3 and 0.9 Mt CO2 per year, respectively. At 0.004 Mt CO2 per year, DAC capacity is also still in its infancy.

CCUS deployment in sectors other than natural gas processing face a common barrier: the lack of commercial value in capturing CO2. This, combined with the extremely high cost of developing a CCUS project in the absence of substantial and consistent policy support, has made CCUS deployment in industrial applications commercially unattractive. DAC projects are especially costly because the technology is still in its infancy, so there are relatively few companies that develop them. 

Policy Support is Scaling CCUS

To address these common barriers, governments have been proactive in passing and implementing measures to encourage the growth of CCUS projects over the past few years. Here, we highlight several of these policy initiatives in North America and Europe.

In the US, the Inflation Reduction Act (IRA) of 2022 offers a considerable boost for CCUS through a tax credit. This tax credit nearly doubles for carbon that is captured from power and industrial plants, and more than triples for CO2 captured from DAC: $60/tonne for utilization from industrial and power sectors, $85/tonne for storing CO2 captured from industrial and power generation facilities in saline geologic formations, $130/tonne for utilization from DAC, and $180/tonne for storage in saline geologic formations from DAC. 

This support is coupled with funding under the Infrastructure Investment and Jobs Act (IIJA), which provides approximately $12 billion across the CCUS value chain in the form of R&D funding, loans, and permitting support over the next 5 years. These funding measures by the US government are the most ambitious of any country. 

In Canada, the 2022 federal budget included an investment tax credit for CCUS projects that permanently store captured CO2 between 2022 and 2030, valued between 37.5 - 60% of the project cost depending on the type of project. 34 CCUS projects were announced in 2022 and 2023, which will help increase Canada’s CCUS capacity by almost 27 Mt CO2 per year by 2030.

In the European Union, funding programs and regulatory reforms will fuel much of this projected growth, particularly the Connecting Europe Facility - Energy ($6.3 billion between 2021 and 2027) and the Innovation Fund ($41.2 billion between 2020 and 2030) that fund CCUS and other clean energy projects. 

Global Oil and Gas Players Lead the Market

While government policies are pivotal for expanding global CCUS capacity, it is companies that ultimately plan, develop, and operate these projects. This section identifies the major players listed in the IEA CCUS Database and highlights the efforts of some of these companies. 

The table below shows the ten companies involved in the largest CO2 capture capacities and the core sector in which each company operates.

Company Name Headquarters Country Company Sector Announced Avg. Capacity (Mt CO2/yr)
Equinor Norway Oil and gas 134
Fluxys Belgium Oil and gas 76
Shell UK Oil and gas 62.9
Air Liquide France Industrial 51.9
BP UK Oil and gas 41.3
Wintershell DEA Germany Oil and gas 38
Exxonmobil USA Oil and gas 38
Mitsubishi Heavy Industries Japan Industrial 27.3
Open Grid Europe (OGE) Germany Oil and gas 24.2
Denbury USA Oil and gas 21.5

Several patterns can be observed. First is the predominance of oil and gas companies in the CCUS industry. Oil majors including ExxonMobil, Shell, BP, and Equinor are also some of the largest players developing CO2 capture infrastructure. With the recent announcement by ExxonMobil to acquire Denbury to expand its CCUS and enhanced oil recovery (more on this below) capacity, the oil majors in this list are set to consolidate even further. Although not included in the top 10, other US oil companies such as Valero and Chevron are also leading players in this field.

Also notable is the absence of companies that specialize in carbon capture in the top 10. Recently, several firms have garnered attention for their proprietary CCUS technologies, such as CarbFix, CarbonFree, Aker Carbon Capture, and LanzaTech. Yet compared to the multinational energy and manufacturing companies that occupy the top spots in the industry, these pure plays are still small, with total CCUS project capacities of less than 5 Mt CO2 per year each. However, the entry of these specialized companies into the CCUS value chain is encouraging. The IEA notes that the value chain that has historically been dominated by vertically integrated oil and gas companies are starting to break up, allowing new players to innovate and reduce costs in parts of the chain. 

To offer deeper insight into the projects in which these companies are involved, we highlight four companies from the table above.

Equinor is a Norwegian oil and gas company whose portfolio also encompasses renewables and other low-carbon solutions. It is the largest provider of pipeline gas to Europe. 

  • Since 1991, Equinor has been a partner in 23 CCUS projects, totalling an average announced capacity of 134 Mt of CO2 per year.
  • 19 of these projects are still in the planning phase, 2 two are operational, 1 one is under construction and one has been decommissioned. 
  • 8 of these projects capture carbon from hydrogen/ammonia production processes, 8 others are related to CO2 transport and/or storage, and 3 are applied to natural gas processing. 
  • In 20 of the 23 projects, the captured CO2 is stored permanently. 
  • All but one of these projects are located in Europe (including the UK), with the sole exception of one project being in Algeria.

Shell, a British multinational oil and gas company that was formed in 1907, is vertically integrated and is active in every area of the oil and gas industry. 

  • Shell participates in 28 CCUS projects around the world, with a total capacity of 62.9 Mt of CO2 per year. 
  • 23 of these projects are in the planning phase, with the expected operation date ranging from 2024 to 2030. 
  • 3 of the projects are already operational, and 2 are under construction. 
  • These projects’ applications vary widely, from 11 projects dedicated to CO2 transport and/or storage, 6 to hydrogen and ammonia production, 3 to natural gas processing, 3 to other fuel transformation, and the rest applied to power and heat, biofuels, and other industries. 
  • In 22 of these projects, the captured CO2 is put into dedicated storage. 

Air Liquide is a French multinational supplier of industrial gasses and services to a variety of industries, including medical, chemical, and electronic manufacturers. 

  • It is involved in 29 CCUS projects whose average announced capacity totals 51.9 Mt CO2 per year. 
  • 17 of these projects transport the captured CO2, while 6 are in other fuel transformation, 3 are applied to cement manufacturing, 2 are in the iron and steel sectors, and 1 in other industry. 
  • All 29 projects are still in the planning phase, with the expected operation date ranging from 2024 to 2040. 
  • 27 of these projects will be located in Europe, and the rest in the US. 

Mitsubishi Heavy Industries is an industrial and electrical equipment manufacturer headquartered in Japan, whose wide-ranging portfolio includes aerospace and automotive components, air conditioners, utility vehicles, defense equipment and weapons, and power systems. 

  • Mitsubishi is a partner on 17 CCUS projects, totaling 27.3 Mt CO2 per year in average announced capacity. 
  • All 17 are still in the planning phase and will be located mostly in North America and the UK. 
  • Their sectoral applications will be varied, with 5 projects capturing CO2 from hydrogen/ ammonia production processes, 3 from power and heat, 3 from natural gas processing, 3 dedicated to CO2 transport and storage, 2 from cement manufacturing, and the rest from other industries. 
  • The CO2 captured from 11 of the projects will be permanently stored.

2030 Global Projections

The IEA data includes CCUS projects that have been announced as of March 2023, and whose construction and operation are expected in the future. In this section, we use that data to predict developments in the global CCUS landscape between now and 2030, both in terms of the geographic distribution of growth and the different fates of carbon.  

North American and European Policy Will Drive Lead in Regional Capacity Growth 

Growing recognition of the role of CCUS technologies in meeting net zero goals is translating into increased policy support all over the world, which in turn is spurring increased growth in CCUS projects. The predominant forms of policy support are tax credits for projects, funding for R&D, and regulatory reforms. Owing to these measures, over 140 new projects were announced globally in 2022, bringing the global announced CCUS capacity up to 45.8 Mt CO2 per year. This compares to 35.7 Mt CO2 per year in 2017, a 28.3% increase over five years.

Looking ahead to 2030, this growth in CCUS capacity is set to accelerate. We can see this trend in the chart below.

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North America will likely account for the vast majority of the increase in CCUS capacity over the next decade, rising roughly 6x from 27.7 Mt CO2 per year in 2023 to 161.8 Mt CO2 per year in 2030. This capacity expansion is in large part due to the region’s established policies designed to stimulate CCUS market growth. Country-specific analysis reveals that the United States will be the primary policy driver of this acceleration, with Canada playing a secondary but important role. With around 80 projects planned for operation by 2030, the CO2 capture capacity in the US is expected to increase by nearly a factor of five, from over 20 Mt CO2 to over 100 Mt CO2 per year, more than 60% of North America’s expected growth.

Although not as drastically as in North America, Europe is also expecting capacity growth, from 2.5 Mt CO2 per year in 2023 to 95 Mt CO2 in 2030 –  a nearly 40x increase in less than a decade.

Changes in the Fate of Carbon: High Hopes for Dedicated Storage

Rapid CCUS deployment over the next several years will be accompanied by changes in how the captured carbon is used, known as the “fate of carbon.” As of 2022, most of the captured CO2 was used in enhanced oil recovery (EOR), at 39.9 Mt CO2 per year. EOR is the process of extracting oil from an oil field that has already gone through the primary and secondary stages of oil recovery. In other words, the use of CO2 in EOR is a way to rejuvenate oil production at mature oil fields. This explains the fact that large oil producers have been the leading players developing CCUS capacity and the recent renewed interest from many of those same companies. Although CO2-EOR can produce “carbon negative” oil (depending on a variety of factors), it is often not considered a reliable decarbonization strategy. At the same time, the clear commercial value of additional oil production has driven CO2 use in EOR to be the earliest and primary fate of carbon.

Starting in 2023, this is predicted to change: As shown in the chart below, dedicated storage is set for a take-off as the biggest fate of carbon. By 2030, we expect that 426.5 Mt CO2 per year will be put into dedicated storage infrastructure around the world, which is more than a 38-fold increase over eight years. On the other hand, EOR is projected to experience a more modest 1.7x growth.

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Note: The second fastest growing fate of carbon is labeled “Unknown/Unspecified” because the IEA’s CCUS Database is based on publicly available information, and unfortunately many of the project announcements do not make the fate of carbon clear. 

This projected growth in dedicated storage is encouraging. Since more CO2 needs to be sequestered than can be used, much of the captured CO2 needs to be permanently stored. This means that dedicated storage infrastructure is a prerequisite for carbon capture technologies to be deployed. 

Many factors, both market- and policy-driven, are propelling the expansion of carbon storage. A growing number of companies, particularly in the manufacturing and energy sectors, are adopting net-zero targets that carve out a role for CCUS. Another factor is the growing proliferation of CCUS “hubs,” or clusters of infrastructure to capture, transport, store and/or use carbon. These hubs help to improve the economics of and therefore facilitate investments in CCUS projects. In the US, a slew of policy incentives, such as the 45Q tax credit passed in 2018 and those in the IRA and IIJA mentioned above, are boosting investments in CCUS projects. In the EU, the revenue from the Emissions Trading System began funding carbon capture, transportation, and storage projects from 2020. 

The predicted growth of dedicated permanent storage infrastructure is welcome news from a climate perspective: According to the IEA, getting to net-zero emissions by 2050 requires that 95% of captured CO2 be permanently stored. There is more than enough geologic CO2 storage capacity globally to meet climate goals, and the technology for achieving this – such as pipelines for CO2 transportation, mechanisms for injecting, trapping, and monitoring CO2 underground – is well-established. Since CO2 transport and storage infrastructure needs to be operational before CO2 capture projects are developed, this projection is encouraging.

Barriers Remaining for Future CCUS Growth

More Policy Support is Needed to Boost Private Investment and Innovation in CCUS

Including all announced and planned CCUS projects in the IEA CCUS Database, the global CCUS capacity will reach 265.25 Mt CO2 per year by 2030. How does this projected increase compare to the amount of CO2 that needs to be sequestered to reach the IEA’s net-zero scenario? 

Sadly, it falls far short of the target. According to the IEA, to stay aligned with its Net Zero by 2050, CCUS technologies need to capture 1.66 gigatons of CO2 (Gt CO2) per year by 2030 globally, and 7.6 Gt CO2 per year by 2050 to reach net-zero emissions. This means that current and planned capacity of CCUS projects expected in 2030 only accounts for less than 20% of the IEA’s target for 2030. The chart below puts this gap into perspective.

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Given this gap, what more can governments and industry around the world do to rapidly scale up CCUS capacity to meet this target over the next decade? The IEA outlines four high-level priorities:

  1. Creating the conditions that make private investment in CCUS more commercially attractive. Policymakers can achieve this by attaching value on CO2 emissions, providing funding support for capital and operating costs for early projects, and allocating risks across the public and private sectors.
  2. Facilitate the development of CCUS hubs with shared CO2 transport and storage infrastructure. Identifying opportunities for CCUS deployment in specific industrial regions and establishing a business model for carbon transport and storage infrastructure, will go a long way toward this goal.
  3. Identifying CO2 storage. The first step would be to characterize and assess geological CO2 storage around the world. The second is to establish a robust legal and regulatory framework around CO2 storage. Lastly, a concerted campaign to support public awareness will ensure that the general public understands and accepts CO2 storage technology.
  4. Boosting innovation to reduce costs and increase the availability of critical technologies. This can be done through public-private partnerships in R&D and increased funding to revamp innovation in key CCUS applications (especially heavy industry, CO2 use for synthetic fuels, and carbon removal).

The policy support in North America, Europe and elsewhere mentioned above are instances of governments working toward meeting these priorities. But there are additional policy and technological developments that promise to accelerate growth faster than projected in this report. 

The US Environmental Protection Agency recently proposed rules that would require power plants to capture or otherwise reduce their carbon emissions. Technological innovations are taking place in chemical absorption systems that can increase CO2 capture rate. The International CCS Knowledge Centre’s feasibility study found that retrofitting existing power plants with CCUS can be cost-competitive, suggesting that the barriers for power plant operators to build retrofit capture facilities may be lower than we assume today. All of these developments point toward the possibility of more rapid CCUS deployment than the IEA dataset projects. 

Technologies to capture carbon from the atmosphere or from point sources are integral to the net zero roadmap. The key take-away is that the business case for CCUS is getting stronger each year as policymakers and investors support its development as a necessary climate solution. Yet, much more rapid deployment is necessary if we are to meet emissions targets to stabilize the climate by mid-century. As North America and Europe are set to experience accelerated growth in CCUS capacity, they may act as the catalysts for policymakers and project developers in other regions to also scale up their CCUS capabilities. 

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