Defossilizing Industry Scaling-up CCU 2025

Conclusion CCU could open up new markets, enhance industrial resilience and provide climate benefits – if given strong public sector support, clear demand signals and innovative finance models. While pioneering activity driven by innovators, first movers and early incentives has built some momentum in recent years, CCU remains a nascent and evolving field. The absence of appropriate market frameworks means that CCU approaches have yet to find a significant role in industrial production. This may be explained by the diversity of contexts in which CCU could play a role, the complexity of integration into existing climate models, as well as the early-stage nature of many technologies involved. Greater confidence in CCU outcomes will develop as technologies mature, though this can be accelerated through the standardization of life-cycle assessments to drive consensus on emissions potential. Although CCU represents a different kind of challenge for policy-makers, this paper’s findings highlight the central importance of the public sector in leading this activity. Ultimately it will be for policy- makers to determine what role CCU should play in their transition strategies. If policy-makers wish to incentivize CCU, these findings highlight the importance of a twin-track approach: –First, de-risking innovation and R&D can help drive performance improvements while enabling financiers and projects developers to become more familiar with CCU approaches. –Second, creating supportive and predictable market environments can enable promising CCU approaches to become competitive against incumbent production routes. At a company scale, the findings of this paper provide useful learnings for other first movers. In particular, the experience of start-ups and early- stage innovators in overcoming financing challenges and valleys of death can be valuable for informing market entry strategies and business planning for others in this space. However, it is equally clear that other corporate and financial stakeholders can also take concerted action to reduce friction for project developers, through establishing clear demand signals and innovative finance models. An ongoing challenge will remain the sector’s ability to coordinate efforts and increase market familiarity with CCU technologies. In this, cross-sector alliances and shared infrastructure could reduce risks, aggregate demand and accelerate learning. If CCU is incentivized it could open up new markets, enhance industrial resilience and provide climate benefits. Through deployment at increasing scale, the evidence base for policy can be expanded, industries can identify value opportunities and financiers can better assess potential investments. We invite stakeholders to engage in an open, evidence-based assessment of CCU, to ensure that future choices about its role are deliberate, informed and aligned with long-term climate and industrial goals. Defossilizing Industry: Considerations for Scaling-up Carbon Capture and Utilization Pathways 36