Carbon Capture and Utilisation (CCU): Turning Emissions into Economic Assets

Why in News ?

Carbon Capture and Utilisation (CCU) technologies are gaining policy and industry attention in India as the country explores pathways to decarbonise hard-to-abate sectors such as cement, steel, power, and chemicals. Unlike Carbon Capture and Storage (CCS), which stores CO₂ underground, CCU converts captured carbon dioxide into useful products like fuels, chemicals, polymers, and construction materials — integrating emissions back into the economic cycle.

Background & Context

India is currently the world’s third-largest CO₂ emitter, with emissions largely driven by coal-based power generation and energy-intensive industries. While renewable energy expansion is progressing rapidly, several industrial processes inherently release CO₂ due to chemical reactions (e.g., clinker production in cement, blast furnaces in steel).

Globally, CCU has emerged as a complementary strategy to renewable energy, energy efficiency, and green hydrogen. International climate frameworks under the United Nations Framework Convention on Climate Change increasingly recognise carbon management technologies as part of long-term decarbonisation pathways.

For India, which has pledged to achieve net-zero emissions by 2070, CCU offers a bridge technology — reducing emissions while creating new industrial value chains and promoting a circular carbon economy.

What is Carbon Capture and Utilisation (CCU) ?

CCU involves three key steps:

1. Capture – CO₂ is captured from industrial flue gases or directly from the atmosphere (Direct Air Capture).
2. Purification & Compression – The gas is processed for safe handling.
3. Conversion/Utilisation – CO₂ is transformed into:
   • Synthetic fuels (e-methanol, aviation fuels)
   • Chemicals (urea, methanol, polymers)
   • Building materials (carbon-cured concrete)
   • Bio-based products

Unlike CCS, which focuses on permanent geological storage, CCU reintegrates carbon into productive economic uses.

Why India Needs CCU ?

1. Addressing Hard-to-Abate Sectors

Sectors such as cement, steel, fertilisers, and refining account for significant industrial emissions. Renewable electricity alone cannot eliminate process emissions in these industries.

2. Supporting Net Zero 2070

CCU complements renewable expansion and green hydrogen strategies, aligning with India’s long-term climate commitments.

3. Promoting a Circular Carbon Economy

By converting waste CO₂ into value-added products, CCU reduces dependence on virgin fossil feedstocks.

4. Energy Security & Industrial Competitiveness

CO₂-derived fuels and chemicals can reduce import dependency and create new manufacturing opportunities.

India’s Progress on CCU

Policy & Research Initiatives

• The Department of Science and Technology has developed a national CCU R&D roadmap.
• The Ministry of Petroleum and Natural Gas has released a draft CCUS roadmap for 2030 identifying industrial clusters for deployment.

Industry-Led Pilot Projects

• Ambuja Cements (Adani Group), in collaboration with IIT Bombay and Swedish partners, is piloting CO₂-to-fuels and material technologies.
• JK Cement is developing a CCU testbed for lightweight concrete and olefin production.
• Organic Recycling Systems Limited (ORSL) is leading India’s first Bio-CCU pilot converting CO₂ from biogas into specialty chemicals.

These initiatives indicate early-stage experimentation but remain limited in scale.

Global Efforts to Advance CCU

1. European Union – Circular Economy Integration

The European Union integrates CCU into its Circular Economy Action Plan and Bioeconomy Strategy, promoting CO₂-derived fuels and materials.

2. United States – Incentive-Based Scaling

The United States promotes CCU through tax credits and funding support for industrial carbon conversion projects.

3. United Arab Emirates – Hydrogen Integration

The United Arab Emirates integrates CCU with green hydrogen in projects like Al Reyadah to decarbonise heavy industry.

4. China – Industrial-Scale Deployment

China is expanding CCUS projects in coal-based power and chemical sectors, focusing on converting CO₂ into fuels and building materials.

Risks and Challenges in Scaling CCU in India

1. High Costs

CO₂ capture and conversion are energy-intensive. Without carbon pricing or incentives, CCU products struggle against cheaper fossil-based alternatives.

2. Infrastructure Constraints

Effective deployment requires:

• Industrial clusters
• CO₂ transport networks
• Integration with downstream industries

Such infrastructure remains underdeveloped.

3. Regulatory & Market Gaps

• Lack of certification standards for CO₂-derived products
• Uncertain demand signals
• Absence of robust carbon markets

4. Risk of Delayed Decarbonisation

Over-reliance on CCU without parallel renewable deployment may slow the clean energy transition.

Significance of CCU for India

Climate Mitigation Tool

Reduces industrial emissions where electrification is difficult.

Industrial Innovation Driver

Encourages advanced materials science and green chemistry innovation.

Strategic Autonomy

Supports domestic fuel and chemical production.

Economic Diversification

Creates new value chains and green employment opportunities.

Global Climate Leadership

Enhances India’s role in emerging carbon management technologies.

Way Forward

• Introduce fiscal incentives and viability gap funding.
• Develop carbon pricing or credit mechanisms.
• Build industrial CCU clusters near refineries and cement plants.
• Promote green hydrogen integration for CO₂-to-fuel pathways.
• Establish certification standards for CO₂-derived products.
• Encourage public-private partnerships and international collaboration.

A balanced approach combining renewable expansion, green hydrogen, energy efficiency, and CCU will be essential for India’s low-carbon transition.