In News:

The Prime Minister highlighted the importance of CCUS in decarbonising India’s heavy industries by sharing an article titled “Carbon capture can power India’s next steel revolution” authored by the Union Minister of Steel. Simultaneously, the Union Budget 2026–27 earmarked ?20,000 crore for a dedicated CCUS scheme, signalling a shift from pilot research to commercial deployment.

What is CCUS?

According to the International Energy Agency, Carbon Capture, Utilization and Storage (CCUS) refers to a set of technologies that capture carbon dioxide (CO?) from:

• Large industrial sources (power plants, steel, cement, refineries), or
• Directly from the atmosphere (Direct Air Capture).

The captured CO? is compressed and transported for either utilization or permanent geological storage.

The Three-Step Process

1. Capture: CO? is separated from other gases using:

• Chemical solvents
• Membranes
• Solid sorbents

2. Transport: Compressed CO? is transported through:

• Pipelines
• Ships
• Road tankers

3. Utilization or Storage

• Utilization (CCU): Conversion into urea, methanol, synthetic fuels, chemicals, building materials, or use in Enhanced Oil Recovery (EOR).
• Storage (CCS): Injection into deep geological formations such as depleted oil and gas fields or saline aquifers for long-term sequestration.

Why is CCUS crucial for India?

1. Decarbonising ‘Hard-to-Abate’ Sectors

Industries like steel and cement emit CO? due to chemical processes (e.g., calcination of limestone), not merely fuel combustion. CCUS is currently the only scalable solution to reduce such intrinsic emissions without shutting down production.

2. Powering India’s Steel Expansion

• India is the world’s second-largest crude steel producer (after China).
• Production: ~152 million tonnes (FY 2024–25).
• Under the National Steel Policy 2017, targets:
  • 300 MT capacity by FY 2030–31
  • 500 MT by 2047 (Viksit Bharat vision)
• Steel accounts for 10–12% of India’s total greenhouse gas emissions.

While hydrogen-based steelmaking is the long-term solution, CCUS acts as a bridge technology, enabling “Low-Carbon Steel” using existing plants.

3. Enhancing Energy Security

India derives 55–60% of its primary energy from coal. Immediate fossil fuel phase-out is economically disruptive. CCUS allows continued coal usage with reduced emissions during transition.

4. Circular Economy & Industrial Value Addition

Captured CO? can be:

• Converted to methanol (clean fuel)
• Used in Enhanced Oil Recovery (EOR)
• Converted into green urea or building materials

Thus, emissions become economic resources.

5. Safeguarding Exports from Carbon Taxes

Global trade is increasingly climate-regulated under mechanisms like the European Union Carbon Border Adjustment Mechanism (CBAM).

Low-carbon steel:

• Reduces export vulnerability
• Attracts climate-aligned investments
• Prevents “stranded assets” in India’s relatively young steel plants

6. Alignment with Global Commitments

CCUS supports:

• Paris Agreement (limit warming to 1.5–2°C)
• Sustainable Development Goals (Climate Action, Affordable & Clean Energy, Industry & Innovation)

India’s Key Initiatives on CCUS

1. Budgetary Push (2026–27)

• ?20,000 crore over five years
• Target sectors: Power, Steel, Cement, Refineries, Chemicals

2. NITI Aayog Policy Framework

• Proposed Viability Gap Funding (VGF)
• Development of CCUS hubs in industrial clusters (e.g., Gujarat, Odisha)
• Shared pipeline and storage infrastructure

3. Green Steel Taxonomy

Steel with emissions <2.2 tCO?e per tonne of crude steel qualifies as “Green Steel” (3–5 star ratings), incentivising adoption of CCUS and avoiding carbon taxes.

4. R&D and Institutional Support

National Centres of Excellence (NCoE-CCU)

• IIT Bombay
• Jawaharlal Nehru Centre for Advanced Scientific Research

DST Roadmap

• Pilot phase: 2025–30
• Commercial scale-up: 2035–45

Mission Innovation Challenge (2018)

• Joint initiative of DST & DBT
• Collaboration with 24 countries
• Focus on breakthrough capture and utilization technologies

Why is it in the News?

Germany has recently declared its approval for carbon capture and offshore storage for specific industrial sectors.

What is Carbon Capture and Storage?

• CCS refers to a host of different technologies that capture CO2 emissions from large point sources like refineries or power plants and trap them beneath the Earth.
• Notably, CCS is different from carbon dioxide removal (CDR), where CO2 is removed from the atmosphere.
• CCS involves three different techniques of capturing carbon, including: Post-combustion, Pre-combustion, and Oxyfuel combustion.
  • In post-combustion, CO2 is removed after the fossil fuel has been burnt. By using a chemical solvent, CO2 is separated from the exhaust or ‘flue’ gasses and then captured.
  • Pre-combustion involves removing CO2 before burning the fossil fuel. “First, the fossil fuel is partially burned in a ‘gasifier’ to form synthetic gas. CO2 can be captured from this relatively pure exhaust stream,” according to a report by the British Geological Survey. The method also generates hydrogen, which is separated and can be used as fuel.
  • In oxyfuel combustion, the fossil fuel is burnt with almost pure oxygen, which produces CO2 and water vapor. The water is condensed through cooling and CO2 is separated and captured. Out of the three methods, oxyfuel combustion is the most efficient but the oxygen burning process needs a lot of energy.
• Post-combustion and oxyfuel combustion equipment can be retro-fitted in existing plants that were originally built without them. Pre-combustion equipment, however, needs “larger modifications to the operation of the facility and are therefore more suitable to new plants.
• After capture, CO2 is compressed into a liquid state and transported to suitable storage sites.
  • Although CO2 can be transported through ship, rail, or road tanker, pipeline is the cheapest and most reliable method.

Can Carbon Capture Help Save the world?

• Operational CCS projects generally claim to be 90 percent efficient, meaning they can capture 90 per cent of carbon and store it.
• Studies, however, have shown that a number of these projects are not as efficient as they claim to be.
  • For example, a 2022 study by the Institute for Energy Economics and Financial Analysis (IEEFA) found most of the 13 flagship CCS projects worldwide that it analyzed have either underperformed or failed entirely.
• Moreover, CCS technologies are quite expensive.
  • When CCS is attached to coal and gas power stations it is likely to be at least six times more expensive than electricity generated from wind power backed by battery storage.
  • It is far cheaper and more efficient to avoid CO2 emissions in the first place.
• There are also only a few operational CCS projects across the world even though the technology has been pushed for decades.
• According to the International Energy Agency (IEA), there were 40 operational CCS projects in 2023, which captured more than 45 metric tonnes (Mt) of CO2 annually.
• To ensure the planet doesn’t breach the 1.5 degree Celsius temperature increase limit, it would take an “inconceivable” amount of carbon capture “if oil and natural gas consumption were to evolve as projected under today’s policy settings.
• It added that the electricity required to capture that level of carbon as of 2050 would be more than the entire planet’s use of electricity in 2022.
• Therefore, there couldn’t be an overreliance on carbon capture as a solution to tackle climate change.