The global carbon capture and storage market size was valued at USD 5.38 billion in 2020 and is anticipated to grow at a CAGR of 12.8% during the forecast period. Carbon capture and storage can be defined as the process that traps the carbon dioxide gas at the emission source and then transporting it to a storage location in turn isolating it. The storage location in most of the cases is underground.
The process guarantees greener energy by capturing the excess carbon dioxide (CO2). They can be employed not only on coal-based sources but also on natural gas and other industrial sources. Carbon capture and storage is an integrated technology with each process complementing the other one. It is a well-proven and established technology and can achieve an efficiency of as high as 90% when deployed. It can capture CO2 fossil fuel emissions thus preventing the harmful gas from escaping to the atmosphere.
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Increasing energy market demand which is the major reason for the usage of fossil fuel is considered as one of the major sources of carbon emission. However, carbon capture and storage is the most practical technology currently available to alleviate greenhouse gas emissions from large-scale fossil fuel usage. This technology has the potential to bridge the gap for the next few decades, cutting emissions until we can shift to a low carbon economy globally. Carbon capture and storage is a key cost-effective option for reducing CO2 emissions in large energy-intensive industries.
In fact, much of the promising short-term potential for carbon capture and storage globally lies not in the power sector but in industrial activities that currently vent highly pure streams of CO2. Due to these factors, the carbon capture and storage industry are estimated to grow significantly during the forecast period. However, currently, this technology is still not adopted in many countries owing to various regulatory issues and for its high initial and operational cost.
Different countries have framed their own regulations and currently, there is still an absence of a single and mutually framed global regulatory framework. In Australia, Canada, and the U.S., for example, regulatory competence is shared between national entities and state or provincial bodies, consistent with the governmental structures in place. The absence of stringent regulatory policies globally for the reduction of carbon emissions is anticipated to restrict the industry growth over the forecast period.
The business players have been concentrating on growing new and increasingly effective CO2 capture and storage innovations and procedures. For instance, the post-carbon capture technology (PostCap) which is based on an Amino Acid Salt solution as solvent is applicable to coal and natural gas-fired power plants. This technology can also be used in existing power plants that are of small, medium, or large scale.
Moreover, with the developing industrialization globally, the production of materials has also been increasing. Hence, to control the increasing carbon emission from these industries huge number of CO2 capture and storage plants need to be set up. These factors are expected to drive the CO2 capture and storage market over the forecast period.
With the technological advancements, offshore E&P activities are increasing which in turn is widening the scope for EOR techniques in this segment. Maturing and depleting oil reserves is estimated to fuel the EOR market for both onshore and offshore wells. Gas injection EOR techniques are also gaining market share globally owing to technological innovations and high recovery rates of these technologies.
It is expected to project the highest growth rates over the forecast period compared to the other EOR techniques, on account of its eco-friendly nature of reducing carbon emissions by utilizing it for crude oil extraction. With the rising application of EOR activities on account of an increasing number of matured oil & gas fields, the market demand of carbon dioxide for utilization in these activities is also increasing. Hence, this growing CO2 market demand for EOR activities is expected to drive the CO2 capture and storage industry over the forecast period.
The market is primarily segmented on the basis of capture type, application, and geographic region.
By Capture Type
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Based on capture type, the global carbon capture and storage market is segmented into pre-combustion, industrial separation, oxyfuel-combustion, and post-combustion. In 2020, the pre-combustion segment accounted for the largest market share. The segment is predicted to witness a decline in market demand based on increasing exploration and production of oil and gas from offshore reservoirs over the forecast period.
However, the post-combustion segment is projected to witness significant growth during the forecast period. Increased energy generation, newly developed advanced amine systems, and heat integration systems are expected to be the main factors driving the CO2 storage market demand over the forecast period.
On the basis of application, the global carbon capture and storage market is segmented into enhanced oil recovery, industrial, agriculture, and others. In 2020, the EOR segment accounted for the highest share of the market. Fluctuating crude oil prices is also expected to drive the EOR market over the next foreseeable future.
Increasing need to extract hydrocarbons from unconventional and low permeability reserves such as tight sands and carbonate traps is expected to have a positive influence on the global EOR market growth. The industrial segment in the second highest in the application sector.
North America dominated the CO2 storage market mainly due to the presence of major market players. North America and the European region are accelerating their drive to combat climate change with a sharp focus on the power sector, the main source of around 40% of carbon dioxide emissions.
Stringent regulatory framework for a cleaner environment coupled with the increasing need for carbon dioxide in enhanced oil recovery processes owing to the increasing number of matured oilfields is expected to be the major factor driving the industry penetration in the North American region.
Ongoing investments toward research and development coupled with the need to introduce economical carbon capture technologies will stimulate the U.S CO2 capture and storage industry. Furthermore, European companies are majorly focusing on R&D and improvising EOR techniques. Technological advancements coupled with the introduction of several modern techniques, which utilize CO2 released in the production stage, are estimated to have immense CO2 storage growth prospects in near future.
However, Asia Pacific is expected to observe the fastest growth during the forecast period. Rapid industrialization coupled with expanding oil & gas industry in Asia Pacific countries is expected to drive the regional EOR market. This is further supported by favorable initiatives by the governments of China and India to facilitate FDI and infrastructural development in the oil & gas industry in the respective nations.
Rapid deployment of gas and coal-fired power plants in order to suffice the increasing demand for energy will propel the Asia Pacific CO2 storage market growth. Rising awareness regarding emission control coupled with ongoing industrial and commercial expansion will augment the business landscape.
Companies in CO2 storage are expanding their presence across various geographies and entering new markets in developing regions to expand their customer base and strengthen their presence in the CO2 capture and storage industry.
The companies are also introducing new innovative products in the market to cater to the growing consumer demands. The key leading players in the market include Shell CANSOLV, AkerSolutions, Statoil, Dakota Gasification Company, Linde, Siemens AG, Fluor, Sulzer, Mitsubishi Heavy Industries, Maersk Oil, Japan CCS Co., Ltd., and HTC CO2 Systems Corp. among others.