The global pipeline for Carbon Capture and Storage (CCS) is expanding, with new project announcements outpacing cancellations. Despite this growth, geopolitical instability and inflation are driving up capital expenditures for new installations. Industry data shows a resilience in CCS planning, though cost pressures remain a significant hurdle for project viability. The balance between new commitments and project failures will determine the actual pace of industrial decarbonization.
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The 2:1 ratio of new announcements to cancellations looks good on paper, but announcements are not steel in the ground. We need to see how many of these actually reach FID.
Exactly. The capital cost hikes mentioned are the real story here. If the CAPEX keeps climbing, those announcements will just become the next round of cancellations. What is the actual projected cost per ton for these new projects?
This is where the subsidy design becomes critical. If the tax credits are fixed and inflation eats the margin, the projects die. We need mechanisms that account for these cost swings to keep the pipeline moving.
I wonder how much of this is just big oil hedging their bets. For actual industrial retrofits in cement or steel, these cost increases are a dealbreaker without massive direct grants.
