CCS is highly compatible with current U.S structure.

With the impacts of more extreme weather already being felt across the globe—July 2019 was the hottest month on record to date [9]—the pressure to decarbonize and address rising CO2 emissions is intensifying. As part of this global challenge, innovation in the energy, industrial and manufacturing sectors must therefore enable sustainable growth. Continued economic prosperity will depend on countries’ ability to reduce their energy intensity. Carbon capture is expected to play a key role, particularly due to three key characteristics of the US economy.

The first is the power sector, which is largely seen as the easiest sector to decarbonize vis-à-vis transportation and industry, yet still faces complex challenges. Despite renewable-energy generation more than doubling since 1990, the USA remains heavily dependent on fossil fuels to satisfy energy demand. In addition, the future of its nuclear fleet, which provides more than 60% [10] of the country’s carbon-free power, remains uncertain. Analysts expect retiring nuclear to be replaced not only by renewable energy, but also by unabated fossil-fuel additions. These asymmetries, coupled with a young natural-gas fleet of 22 years average age [11] and further unabated, natural-gas capacity underway, underpin the need to deploy carbon capture in the US power sector.

The second is the industrial sector—an often-overlooked sector in terms of decarbonization and CCS deployment. It remains the largest consumer of energy and is responsible for 22% of emissions [12]. In 2017, the sector was also responsible for ~18.2% [13] of US gross domestic product. So far, experts agree that the sector has felt little pressure to decarbonize due to the lack of solutions and understanding of the challenge, as well as its significant political economic influence. In fact, the industrial sector offers early deployment opportunities for CCS. As of November 2019, 17 of 19 operating, large-scale facilities globally are in the industrial sector [14]. In the USA, 9 of 10 operating, large-scale facilities are in industry. Furthermore, low-cost applications of CCS are concentrated in industry, amenable to a near-term roll-out of the technology that could result in significant cost reductions and learning-by-doing. For example, processes that produce a pure stream of CO2 such as ethanol production and natural-gas processing can start at $15/tCO2.

Further, CCS can play a key role as a low-carbon heat solution and for process emissions from cement and steel [15]. Industrial heat emissions alone account for 10% of global emissions and research has shown that many decarbonization options are more costly than CCS application [16]. Along these lines, a key to decarbonizing industry could be hydrogen, whose production from fossil resources can be decarbonized with CCS. In fact, the USA holds ideal conditions for large-scale hydrogen production with CCS thanks to the vast availability of low-cost natural gas [17]. A 2014 NETL study showed that almost 70 Mtpa of CO2 would be available for capture from hydrogen production alone. A total of more than 250 Mtpa of CO2—almost 10 times the US capture capacity today—would be available for capture from hydrogen, cement, steel, ethanol, ammonia production and natural-gas processing combined [18]. Hence, the industrial sector should be considered a key target for CCS deployment.

The third is the USA’s economic structure; the USA is strongly dependent on fossil fuels, providing ideal conditions for CCS deployment. In fact, in 2018, about 80% of the primary energy demand was satisfied by natural gas, coal and petroleum [19]—a share that has been constant for the last decade. Between 1983 and the great recession, the share hovered around 85%. These long-term trends signal strong rigidity of the US energy economy. The USA, due to the shale revolution, has also become the largest natural-gas producer in the world, holding this position since 2009, but also demonstrating its ability to improve techno-economic processes through innovation. Due to its fossil-fuel-dependent economic structure, the USA, along with China and Russia, ranks highest in the Global CCS Institute’s Inherent Interest in CCS [20], which is a relative index based on the share of fossil-fuel production and consumption, indicating an economy’s suitability for large-scale CCS deployment to diversify and decarbonize its energy production.

However, the USA’s energy economy evidences further supporting factors for CCS commercialization in the near-to-medium term, underpinning the country’s suitability. The structure of its energy supply has also contributed to low energy prices in comparison to other advanced economies, boosting energy security, while also strengthening the desire by producers, policymakers and consumers to maintain low levels of energy prices [21]. At the same time, for the past decade, the country has been a leader in energy-supply investment and the second largest destination for energy investment, right after China [22], evidencing strong government commitment as well as a capability to attract investment in the sector. On an absolute basis, the USA invests more than any other nation to support clean-energy innovation. It invests more in total clean-energy RD&D ($6.8 billion in 2018) than the next two countries, China and Japan, combined and more in basic energy science than all other nations combined [23]. Therefore, the desire to maintain strong energy security as well as accelerate innovation provides fertile ground for large-scale CCS deployment.