Central government working on national mission to provide subsidies for CO2 capture | Mint

The Centre is working on a national mission that will provide financial incentives to promote carbon capture, utilisation, and storage (CCUS) to help the country achieve its ambitious net-zero targets.

Niti Aayog member VK Saraswat said on the sidelines of the 32nd Annual General Meeting of the American Chamber of Commerce in India (AMCHAM India) in New Delhi on Thursday that the Union Ministry of Power, Niti Aayog and the Office of the Principal Scientific Adviser to the Prime Minister’s Office (PMO) are working on this mission.

Earlier, while addressing the event, he said, “We now need to come forward with a mission mode approach and that is why the government is proposing that we launch a CCUS mission in which subsidies in terms of viability gap funding (VGF), carbon pricing and tax system, carbon trading and PLI can be provided to reduce carbon footprint.”

He said one of the features of the mission would be to assist in setting up pilot plants that can absorb 500 tonnes of CO2 per day.

In a presentation during the event, Saraswat said the sector-wise CO2 storage potential in western, southern, eastern, north-eastern and northern regions of India during 2030-2050 would be 388.9 gigatonnes, 80.58GT, 76.3GT, 47.2GT and 7.65GT, respectively.

He added, “CCUS technologies will be critical in helping India achieve its ambitious net-zero emissions target by 2070. As a nation, we must prioritise the development and deployment of CCUS solutions across our industrial and energy sectors. Collaboration with international partners such as the US will be critical to accelerate innovation, increase deployment, and reduce costs.”

He said the need for government assistance in the form of tax credits could be assessed on a case-by-case basis.

He said about 361 million tonnes per annum (MTPA) of CO2 capture capacity is being developed globally. As of 2022, the global CCUS market size was valued at $2.49 billion, and an annual growth rate of 13.3% is expected during 2022-2030.

Carbon capture alone accounts for about 75% of net CCUS costs, he said.

CCUS involves capturing CO2, usually from large industrial sources such as power generation or other industrial facilities that use fossil fuels or biomass as fuel. If it is not used on site, it is compressed and transported by pipeline, ship, rail or truck so it can be used in a number of applications or injected into deep geological formations such as depleted oil and gas reserves or saline aquifers.

This technology can be retrofitted into existing power and industrial plants, allowing them to continue operating. It is expected to play a key role in achieving global net-zero goals. It is growing rapidly in India as the government has set an ambitious target of achieving net-zero emissions by 2070.

According to the International Energy Agency (IEA) website, although CCUS deployment has lagged behind expectations in the past, the pace has picked up significantly in recent years, with more than 500 projects in various stages of development across the CCUS value chain. “Nevertheless, even at this stage, CCUS deployment will remain well below that required in a net-zero scenario,” it said.