Defossilizing Industry Scaling-up CCU 2025

Bahamas China Canada Israel Mexico EU + EEA US UKShare of total investment 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 2018 2019 2021 2022 2023 2024 2025 2020The US still dominates investment in CCU, but EU, Canada and UK are catching upInvestment in CCU companies, relative share by region (2018-2025) FIGURE 10 Note: Countries refer to location of company HQ. Source: Wood Mackenzie Lens Carbon, data provided by Dealroom (2025). Financial barriers and enablers along the innovation curve3.2 Each stage of CCU technology development – early research, pilot testing, demonstration and commercial deployment – presents a distinct set of financial challenges. These stages differ in capital intensity and cost of capital, as well as types of investors and risk profiles. As CCU technologies develop they encounter successive valleys of death, where funding gaps can stall progress despite technological promise. Mapping these barriers along the innovation curve helps identify where targeted interventions from both private and public actors would be most effective in supporting start- ups and first-of-a-kind technology deployments (see Figure 11).Figure 11 gives an illustrative generic overview of the funding pathway for CCU start-ups, the roles of different investors at different funding stages and key valleys of death. Real-world journeys along this curve vary according to specific technology and company. Additionally, while the relationship is not exact, each funding stage can enable incremental increase in technology development (TRL) and scale, from early R&D, pilots and demonstrations up to full commercial deployment. A funding gap often emerges when transitioning from research validation to industrial pilot development: the first valley of death in the CCU life- cycle. Defossilizing Industry: Considerations for Scaling-up Carbon Capture and Utilization Pathways 23