2021 Reports

Opportunities and Limits of CO2 Recycling in a Circular Carbon Economy: Techno-economics, Critical Infrastructure Needs, and Policy Priorities

Bhardwaj, Amar A.; McCormick, Colin; Friedmann, Julio

Despite growing efforts to drastically cut carbon dioxide (CO2) emissions and address climate change, energy outlooks project that the world will continue to rely on certain products that are currently carbon-intensive to produce but have limited alternatives, such as aviation fuels and concrete. Converting CO2 into valuable chemicals, fuels, and materials has emerged as an opportunity to reduce the emissions of these products. However, these CO2 recycling processes have largely remained costly and difficult to deploy, underscoring the need for supportive policies informed by analysis of the current state and future challenges of CO2 recycling. In this study, we constructed bottom-up models of 19 electrochemical and thermochemical CO2 recycling pathways to understand the opportunities and the technical and economic limits of CO2 recycling products gaining market entry and reaching global scale. The pathways were designed to consume renewable electricity and use chemical feedstocks derived from electrochemical pathways powered by renewable energy. Across these CO2 recycling pathways, we evaluated current production costs, sensitivities to cost drivers, carbon abatement potential, critical infrastructure and feedstock needs, and the effect of subsidies. We find that the costs of most pathways are high, and dominated by the cost of electricity and chemical feedstocks. Based on these cost estimates, we identify the most economic pathways for early market entry and recommend demand pull policies to begin deploying them. The strongest driver for cost reductions is catalyst selectivity and activity, motivating a focus on catalyst innovation to bring down costs. We also find that CO2 recycling pathways at global scale would each require trillions of dollars of investment in supporting infrastructure and would consume thousands of terawatt hours of electricity annually. Therefore, a concurrent focus on building out necessary infrastructure is needed to support the scale-up of CO2 recycling. With the proper approach to advancing CO2 recycling, we find these pathways could abate gigatonnes of CO2 per year at global scale.

Keywords: CO2 recycling, CO2 conversion, CO2 utilization, hard-to-abate sectors, techno-economics, energy policy, deep decarbonization