Defossilizing Industry Scaling-up CCU 2025

Utilization pathways 1.3 There is a range of emerging CCU pathways at different levels of technology readiness and addressable market potential (see Figure 5). Applications span agriculture, construction, fuel and chemicals manufacturing, as well as emerging next-generation materials such as graphene and carbon nanotubes. The relative scale of these applications in the coming decades will be driven by a combination of demand in end-use sectors, the rate of learning improvements and cost reductions in both CCU technologies and feedstocks such as low-carbon hydrogen. Fuels and chemicals Methanol represents a significant market opportunity, given the wide range of downstream applications across olefins, e-fuels and maritime transport. Current forecasts see e-methanol demand of around 40 Mtpa by 2050, out of a total 227 Mtpa of overall global demand.25 This represents approximately half of overall low-carbon methanol production. There will be potential for this to grow further if e-methanol becomes the dominant production route; however it is competing against other low-carbon approaches. Bioethanol/e-Ethanol may present a significant, but comparatively lower, market opportunity as demand for gasoline is expected to decline in the coming decades. The technology exists at near-commercial scale today, with LanzaTech already producing at sites around the world. SAF-producing pathways benefit from existing policy support, particularly in Europe with mid-term growth potential.Use of e-methane could play a similar role to alcohols as a feedstock in chemical and plastic applications, as well as in fuel applications. e-Methane benefits from opportunities to leverage existing infrastructure, as well as its potential as a “drop-in” replacement for fossil methane.26 Demand for olefins will be substantial by 2040, with the Chinese market being a primary driver. Projecting forward to 2040, global demand for ethylene and propylene derivatives could be as high as 519 Mtpa.27,28 However, steam cracking is currently modelled to provide the majority of associated production capacity. Market penetration of CCU into the olefins sector will require cost reductions in catalytic CO2 hydrogenation and/or electrochemical CO2 conversion pathways, as well as methanol and ethanol synthesis feeding into alcohol-to-olefin routes.29 Regardless of pathway, the feasibility of all CCU- derived hydrocarbon production will be strongly influenced by the cost and availability of renewable electricity, low-carbon hydrogen and CO2. Building materials The use of CO2 in building materials, specifically CO2-treated aggregates and CO2-cured concrete, are near cost-competitive today, with significant growth potential. Global markets for these materials already exist at scale and are forecast to grow to over 100 Gt across concrete and aggregates by 2040.30 Only a portion of this demand is likely to be realized by CO2-treated products and, in Current forecasts see e-methanol demand of around 40 Mtpa by 2050, out of a total 227 Mtpa of overall global demand. Defossilizing Industry: Considerations for Scaling-up Carbon Capture and Utilization Pathways 10