CCS Cost Reduction and Scalability Challenges

Marco Ferraz, head of upstream and industrial innovation at Galp, emphasized during an Upstream panel that carbon capture and storage (CCS) technology is mature enough for deployment but requires significant cost reductions—at least 30-50% lower capital expenditure—to enable large-scale adoption by industrial users. He noted that while tens of millions of tonnes of CO₂ are captured annually, the sector must reach gigaton-scale by mid-century to meet transition goals, highlighting a fundamental scalability problem.

Key Barriers and Sectoral Impact

Ferraz identified high upfront costs, particularly on the capture side, as the main constraint preventing broader deployment. This cost hurdle is especially acute for hard-to-abate sectors like cement, ceramics, and glass, where emissions are tied to industrial processes rather than energy use. For these sectors, CCS is the only viable path to carbon neutrality, as they lack alternatives for process emissions.

Modularisation as a Solution

To address scalability and cost issues, Ferraz argued that modularisation—standardizing designs, components, and processes—is essential. Rather than relying on large, centralized facilities, modular systems could lower costs and improve accessibility for small and medium-sized emitters, who currently find existing technologies too large and costly to afford.

Economic Viability and Carbon Pricing

While carbon pricing remains a key factor for project viability, current European prices (around €75 per tonne under the EU Emissions Trading System) are too low to support CCS investment without further cost reductions. Most projects only become viable at levels above €100 per tonne. Longer term, Ferraz stressed the need to transform CO₂ from a liability into an asset, evolving from managing it as waste to monetizing it.