5 October 2022
Innovation in almost any sector is advancing at a pace that we have not seen before. “Science, Not Fiction” blogpost series explores these innovative sectors in pursuit of creating a liberal environment, to push the boundaries of science even further.
By Elias Rosell, Political Editor for Östersunds-Posten
In Jülich, Germany, Synhelion has successfully used solar heat to convert CO2 and water to synthetic fuels. Like fossil fuels, these consist of carbon and hydrogen, meaning they can replace fossil fuels without major engine changes. This fact makes synthetic fuels particularly suitable for long-haul flights and other forms of transport that are difficult to electrify. Swiss International Air Lines will start buying fuels from Synhelion next year.
The Canadian company Carbon Cure has developed a technology to inject carbon dioxide into cement. When the carbon dioxide reacts with the cement, it is permanently stored in the concrete. Carbon dioxide is thus converted into stone. Among other applications, the concrete produced with this technology has been supplied to Amazon’s building projects.
In the western Netherlands, around 600 greenhouses use the carbon dioxide from industrial plants to enhance their yields, saving 250 kilotonnes of CO2 emissions from natural gas annually.
These are just a few examples of existing projects or ones that are underway where carbon dioxide is used as a resource to aid in the climate transition.
Carbon utilisation is a promising means of reducing emissions, but all related processes must be powered by low-carbon energy in order to maximise its potential. If the energy used to make carbon dioxide and hydrogen into a synthetic fuel came from a coal-fired power plant, then a large part of the climate gain would disappear.
Especially for CO2-based fuels and chemicals, the production cost is higher than for “their conventionally-produced counterparts”. In addition, Europe’s high electricity prices are a challenge for the development of CO2-based fuels and chemicals because electricity accounts for 40–70 per cent of their production cost. On the other hand, the prices of petrol and diesel are also unusually high today.
Regardless, the war in Ukraine and the related energy crisis only make synthetic fuels even more relevant. There are obvious reasons for the West to manufacture synthetic fuels based on raw materials such as carbon dioxide and hydrogen instead of importing fossil fuels from authoritarian states.
As Lukas Trakimavičius and Christophe Nave from the NATO Energy Security Center of Excellence suggested in an article in Euractiv last fall, synthetic fuels would reduce the Baltics’ dependence on imported oil. The same conclusion should now apply to all of Europe. Therefore, the development of CO2-based fuels in the EU will be good for both the climate transition and the security of Europe.
The EU’s Emissions Trading System regulations have long been an obstacle to CO2 capture and use development. The problem, as the International Energy Agency (IEA) described in a report from 2019, is that “whenever an emitter uses or sells CO2 for conversion into products, the CO2 must be reported as emitted”. What follows is a lack of incentive for industries to use carbon dioxide instead of just emitting it.
Therefore, it is very promising that the European Commission, in a proposal for a revised EU ETS Directive, write that they want to create “an incentive for capturing and utilising emissions to become permanently chemically bound in a product so that they do not enter the atmosphere under normal use”. The industry has welcomed this. The organisation CO2 Value Europe calls the proposal a “major milestone”.
But the last word has not yet been said regarding how the EU ETS should be revised. The Council, the European Parliament and the European Commission will have “trilogues” on the subject before the upcoming COP27 climate meeting this autumn.
It is crucial to ensure that the EU ETS will provide future incentives for carbon use. At the same time, a distinction must be made between CO2 use that includes long-term storage and uses where carbon dioxide is released into the atmosphere.
It is particularly important for there to be incentives for technologies that combine negative emissions with CO2 use, such as when carbon dioxide is captured from the atmosphere to become part of cement. One way this could be done is that an operator capturing and sequestering carbon dioxide receives a per-tonne allowance that can be sold within the EU’s emissions trading system. A possible counterargument against this would be that an increased number of emission allowances may lead to increased emissions. But since each tonne of extra emissions would be counteracted by a tonne of captured carbon dioxide, such a system would not negatively affect the EU’s goal of becoming climate neutral by 2050. On the contrary, it would be desirable if both reduced emissions and carbon capture technologies were incentivised to contribute to the goal.
There is still more to do. Carbon use must be included in the EU’s taxonomy of sustainable investment. As the organisation CO2 Value Europe has pointed out, that is not the case today. This needs to be addressed in connection with future evaluations of the taxonomy because technology can and will help in the fight against climate change.
It is, however, not only up to the EU to ensure that carbon dioxide becomes a solution instead of a problem. Member states should take inspiration from the American 45Q tax credit, which gives an incentive to those working with technologies linked to carbon capture and the conversion of CO2 into usable products. A liberal environmental and energy security policy would use tax credits rather than subsidies.
The abundance of carbon dioxide in the atmosphere is creating significant problems for Europe today. It’s time to start using it as a resource.
Elias Rosell is an Earth Scientist who is working as a journalist, he often writes about environmental and energy issues. He now works as a political editor at Östersunds-Posten and has previously worked as a research coordinator at the European Liberal Forum.
DISCLAIMER: Published by the European Liberal Forum. The opinions expressed in this publication are those of the author(s) and do not necessarily represent those of the European Liberal Forum.