From cycling to climate benefit: a perspective on redefining CO₂ utilization for reduction and storage

Defining the enhanced CCU framework

CCU encompasses both utilization processes that capture CO₂ from industrial emissions or the atmosphere and convert it into products such as fuels, chemicals, or construction materials. Traditionally, CCU has been synonymous with "cycling" pathways - applications in which CO₂ returns to the atmosphere within weeks to months after product use. These conventional approaches provide climate benefits primarily through fossil feedstock substitution: producing methanol, urea, or synthetic fuels from captured CO₂ reduces the need to extract virgin fossil carbon, and when powered by renewable energy, significantly lowers upstream emissions. However, the temporary nature of storage has led critics to question whether such pathways can meaningfully contribute to long-term climate goals. The broader concept of carbon capture, utilization, and storage (CCUS) recognizes that both carbon utilization and permanent sequestration play complementary roles in achieving net-zero emissions. CCUS frameworks acknowledge that neither pathway alone is sufficient for deep decarbonization: permanent storage is essential for sectors with hard-to-abate emissions, while utilization can offset carbon-intensive production in the chemical and materials industries. Consequently, most policy discussions and capacity targets now adopt a CCUS perspective rather than treating CCS and CCU as competing alternatives.

This perspective advances what we term an enhanced CCU framework that moves beyond the conventional cycling paradigm. Rather than viewing CCU solely as temporary carbon recycling, we propose three distinct pathways that expand its climate potential. The first pathway retains the cycling concept but emphasizes the integration of renewable hydrogen to maximize fossil substitution benefits. The second pathway - biogenic-integrated CCU - achieves climate neutrality by coupling biogenic CO₂ sources (such as emissions from bioethanol production) with renewable hydrogen, effectively closing the carbon cycle through biomass regrowth while preventing new fossil extraction. The third pathway pursues durable storage through two mechanisms: mineralization in concrete that locks CO₂ for centuries, and CO₂-derived hydrogen carriers that enable separation and permanent storage at the point of use. This latter mechanism is particularly significant because it allows products traditionally classified as "cycling" to become pathways for permanent removal when integrated with appropriate infrastructure. What distinguishes this enhanced framework from existing classifications is the explicit coupling of carbon source with end-of-life fate. Previous frameworks effectively categorized pathways by storage duration and energy requirements, establishing that "cycling" and "closed" applications deliver fundamentally different climate outcomes. Our framework builds on these insights but introduces an additional strategic dimension: recognizing that the origin of CO₂ - whether fossil or biogenic - determines whether short-duration storage represents temporary avoidance or climate-neutral cycling. Similarly, we emphasize that end-of-life, particularly for hydrogen carriers, can transform the classification of a product from cycling to durable storage. This source-fate coupling reveals that CCU's climate contribution is not predetermined by product type alone, but rather by strategic choices in feedstock selection and system design. Table 1 summarizes the key distinctions between these pathways.

Enhanced CCU occupies a distinct niche within carbon management strategies, neither fully competing with nor replacing CCS, direct air carbon capture and storage (DACCS), or bioenergy with carbon capture and storage (BECCS), but offering complementary pathways suited to specific contexts. Unlike geological CCS, which provides permanent storage but requires dedicated infrastructure and lacks revenue generation, CCU can offset costs through product sales while enabling incremental deployment at smaller scales. However, this economic advantage comes with the trade-off of reduced storage permanence in cycling pathways. DACCS offers the unique advantage of location-independent deployment and direct atmospheric CO₂ removal, making it essential for addressing residual emissions and achieving net-negative targets. Despite its potential, DACCS deployment remains constrained by significant technical and economic barriers. Commercial-scale implementation has been achieved by only a single technology, with most approaches still at laboratory or early pilot stages (Technology Readiness Level (TRL) ≤ 6). Current systems demand substantial energy inputs - approximately 1,500 kWh/tCO₂ for thermal energy and 500 kWh/tCO₂ for electricity - resulting in capture costs between 600-1,000 US dollars per metric ton (USD/tCO₂). Achieving climate-relevant scale necessitates major advances in both energy efficiency and cost reduction^[9-12]. Enhanced CCU, particularly when paired with biogenic CO₂ sources or durable storage pathways, can achieve comparable climate outcomes at lower energy intensity for near-term industrial decarbonization.

BECCS similarly provides net-negative emissions through biogenic CO₂ capture and geological storage, but faces constraints from sustainable biomass availability, land-use competition, and water requirements^[13,14]. Biogenic-integrated CCU pathways offer a less land-intensive alternative by utilizing existing biogenic CO₂ streams (ethanol fermentation, biogas upgrading) without requiring additional biomass cultivation, though at the cost of temporary rather than permanent storage. The strategic value of enhanced CCU lies in three distinct roles: (1) as a transitional bridge enabling immediate emission reductions while permanent storage infrastructure scales, (2) as a hybrid platform where CO₂ can be flexibly allocated between utilization and geological storage based on market conditions, and (3) as a value-creation pathway that makes carbon management economically viable for sectors where pure CCS faces financial barriers. Rather than viewing these technologies as competing alternatives, integrated deployment strategies can leverage their complementary strengths. For instance, regional hydrogen-CCU hubs could combine CO₂-derived carriers for short-term cycling with geological storage for surplus CO₂. At the same time, biogenic CCU could provide carbon-neutral feedstocks for industries where CCS is technically or economically constrained. The key is matching technology choice to permanence requirements, cost constraints, and infrastructure readiness - recognizing that no single approach will achieve net-zero targets alone.

Overview of CO₂ management strategies

The foundation of effective CO₂ mitigation rests on preventing emissions at their point of origin through four interconnected mechanisms. Figure 1 outlines six distinct methods for CO₂ reduction and removal, organized into two primary operational domains that target different phases of the carbon mitigation continuum^[15].

Figure 1. Approaches to address CO₂ emissions through reduction, capture, utilization, and long-term storage, modified from Johnstone et al. (2025)^[15] (Created using Adobe Illustrator 2021).

(1) Clean energy transition systematically replaces fossil fuel infrastructure with renewable energy systems, including solar installations, wind generation, and efficiency optimization protocols. This delivers permanent emission reductions across electricity generation and energy consumption sectors. (2) Ecosystem protection safeguards against emissions from deforestation and terrestrial degradation through forest conservation initiatives and sustainable agricultural practices. (3) CCS intercepts CO₂ emissions directly from point sources such as power plants and industrial operations. It sequesters captured carbon in geological formations for millennial timescales while enabling transitional use of existing fossil fuel infrastructure. (4) CCU transforms CO₂ into commercially viable products, including synthetic fuels, construction materials, and chemical feedstocks. Storage duration depends on product lifecycle characteristics and ultimate disposal pathways. (5) Natural carbon storage harnesses biological and soil systems to sequester atmospheric CO₂ through reforestation programs, regenerative agricultural practices, and biochar deployment. However, inherent reversal risks remain due to environmental disturbances such as wildfires, droughts, or land-use changes. (6) Engineered removal deploys technological solutions for permanent atmospheric CO₂ extraction and sequestration, incorporating direct air capture systems and enhanced mineral weathering processes that provide robust storage mechanisms with minimal reversal probability. These six pathways function synergistically within a hierarchical framework, where emission reduction takes precedence over offsetting strategies. Residual emissions require counterbalancing through permanent CO₂ removal technologies to achieve authentic net-zero status and establish long-term atmospheric stability. The following sections will examine the potential pathways for CCU development and analyze the global implementation potential, considering technological feasibility, economic viability, and policy frameworks necessary for widespread deployment.

CCU for net-zero emissions

The urgency of deploying CCUS becomes clearer when considering the current state of atmospheric CO₂. Global CO₂ concentrations reached more than 430 ppm in 2024 - approximately 50% higher than pre-industrial levels - driving record global average temperatures^[16]. Total fossil-fuel-related CO₂ emissions were approximately 37 gigatonnes (Gt) CO₂ in 2023, and when including land-use change, the figure rises to around 41 Gt CO₂. Total greenhouse gas emissions reached 57 Gt of CO₂ equivalent (CO₂-eq) in 2023, representing the highest level on record. Without rapid reductions, these levels are incompatible with limiting warming to 1.5 °C^[17,18]. Against this backdrop, the geological storage potential for CCS is immense, estimated to be well over 5,000 Gt of CO₂ worldwide, far greater than the cumulative emissions expected this century^[19]. Yet, current deployment remains minimal, with global CCS capacity storing just over 50 million tonne (Mt) CO₂ per year and CCU contributing 230 Mt CO₂ annually, mostly through enhanced oil recovery, urea production, and beverage production - together representing under 0.5% of global emissions^[4,20]. By 2030, project announcements suggest a global capacity of 430-435 Mt CO₂ per year; however, this is insufficient to meet net-zero goals, which call for approximately 1 Gt annually by that date^[4,21]. The 2050 outlook ranges from negligible to 13 Gt CO₂ yearly, with most scenarios projecting 2-3 Gt. Thus, CCUS may contribute about 6% of the emissions reductions needed to achieve net-zero goals^[22].

Traditional carbon storage methodologies face substantial operational barriers. These include excessive implementation costs, technical limitations, and risks of subsurface CO₂ migration from geological repositories. In contrast, CCU technologies offer compelling benefits by transforming captured carbon dioxide into marketable commodities and chemical feedstocks, thereby generating revenue streams that help offset the initial investment in capture. Different conversion technologies exist at various development stages. Some remain in laboratory research phases, while others approach commercial viability according to TRL evaluations^[2]. Sustained investment in research and technological advancement remains crucial for thoroughly evaluating the practical implementation potential of novel CO₂ transformation processes, establishing their economic sustainability, and scaling successful approaches to industrial magnitudes that can support global decarbonization targets.

CCU works by intercepting CO₂ from large point sources, such as cement kilns, steel mills, or chemical plants, or directly from the atmosphere, and then utilizing it as a feedstock for industrial processes. CO₂ can be combined with hydrogen (preferably from renewable electrolysis) to produce fuels, chemicals, and materials. Alternatively, it can react with minerals to form carbonates for use in construction applications. From a life-cycle assessment perspective, CCU can avoid emissions through three mechanisms. First, by diverting CO₂ that would otherwise be emitted into the atmosphere, the process reduces point-source emissions. Second, CCU products provide substitution credits when they replace conventional products with higher cradle-to-gate emissions. Third, when CCU processes are powered by renewable energy or utilize low-carbon hydrogen, significant additional emission reductions are achieved by avoiding energy-related emissions. Recent methodological updates stress the importance of accounting for CO₂ storage duration and timing. Many earlier assessments did not adequately consider permanence. Urea production exemplifies these benefits. Both conventional and CCU-based or green urea production consume CO₂ as feedstock - about 0.73 tonnes of CO₂ per tonne of urea. However, conventional urea relies on fossil-derived ammonia and often fossil-derived CO₂, making it highly emission-intensive. "Green" urea produced using renewable hydrogen for ammonia and captured CO₂ can prevent roughly 2.6 tonnes of CO₂ emissions per tonne compared to conventional methods. Since the embedded CO₂ returns to the atmosphere during fertilizer application, the net climate benefit is about 1.9 tonnes of CO₂ avoided per tonne of urea, primarily from substituting fossil ammonia and preventing direct emissions of captured CO₂^[2]. As illustrated in Figure 2, CCU can approach true carbon neutrality when paired with biogenic CO₂ and renewable hydrogen. Shifting from fossil-derived to biogenic CO₂ is particularly important for products with high utilization volumes, such as methanol, since it converts temporary avoidance into genuinely sustainable and climate-neutral pathways.

Figure 2. Conceptual pathways of CO₂ utilization from different sources to methanol production and end-use applications. CO₂ is captured from fossil-based industrial processes, biogenic emissions from ethanol production, and bioenergy facilities. The captured CO₂ is combined with renewable hydrogen to produce methanol, which serves as a chemical feedstock, hydrogen carrier, or input for cement curing, highlighting CCU's role across chemicals, energy, and building materials sectors (Created using Microsoft PowerPoint 365).

Beyond chemical production, CCU products such as methanol or formic acid can also serve as hydrogen carriers, enabling the efficient storage and transportation of renewable hydrogen^[23]. In such systems, the CO₂ released during hydrogen regeneration does not need to return to the atmosphere; instead, it can be diverted into cement curing and mineralization processes, where it is locked permanently. This integrated approach - utilizing biogenic CO₂ for carbon-neutral fuels and chemicals, while capturing and embedding separated CO₂ in building materials - offers a pathway to overcome the cycling nature of CCU and achieve lasting climate benefits. Moreover, CCU chemicals can serve as energy carriers. For example, formic acid or methanol functions as an effective hydrogen carrier, replacing fossil-based alternatives while delivering both economic advantages and significant CO₂ emission reductions^[2,24]. Methanol is produced by hydrogenating CO₂, consuming about 1.4 tonnes of CO₂ per tonne of methanol. With fossil CO₂, the process can avoid approximately 1.95 tonnes of emissions during production; however, when methanol is burned or used, that carbon is fully re-emitted, resulting in a minimal long-term reduction. By contrast, if biogenic CO₂ is used, the re-release at use returns carbon that was recently absorbed from the atmosphere. Combined with renewable hydrogen, this enables methanol to function as a nearly carbon-neutral fuel or chemical, offering it greater long-term climate potential than urea^[25]. Among the most impactful CCU applications, microalgae-based biodiesel has demonstrated high potential for reducing emissions compared to fossil diesel. Martín and Grossmann (2017)^[26] proposed a conceptual design that integrates renewable energy into microalgae cultivation and processing, capable of capturing approximately 4 kg of CO₂ for every kilogram of biodiesel produced. Given that cement production contributes approximately 7%-8% of anthropogenic CO₂ emissions, implementing carbon mineralization and carbonation curing technologies could facilitate the permanent sequestration of 0.39 Gt CO₂-eq annually, representing nearly 15% of sectoral emissions^[27].

The thermodynamically favorable carbonation reactions not only provide durable carbon storage but also simultaneously enhance the mechanical properties of cementitious matrices, creating a synergistic mechanism that enhances performance. However, large-scale deployment is constrained by energy penalties in capture processes, heterogeneity of carbonatable residues, and supply-demand mismatches for mineralized products. Thus, accelerating research into low-clinker binders, accelerated carbonation curing, and integration of industrial waste streams remains essential to position cement as one of the most scalable and durable CCU pathways.

Beyond cement, broader CCU applications present fundamentally different utilization characteristics and temporal scales. Recently, Ravikumar et al. (2021)^[8] assessed 20 CCU pathways and found that only four achieved net climate benefits: two concrete applications involving CO₂ mixing and two chemical routes - formic acid via CO₂ hydrogenation and carbon monoxide via methane dry reforming. Enhanced oil recovery, while offering immediate economic returns and proven CO₂ storage mechanisms, raises questions about net climate benefits when coupled with continued hydrocarbon extraction. Chemical synthesis pathways for platform chemicals and synthetic fuels offer opportunities to displace fossil-derived feedstocks; however, their climate impact depends heavily on the energy source used for CO₂ conversion processes. High-value applications in pharmaceuticals and advanced materials, despite limited volume capacity, offer economic incentives that could drive technology development and infrastructure investment. Current research gaps span all sectors but center on fundamental challenges in energy efficiency and process economics. Most CCU pathways currently exhibit unfavorable energy balances, requiring more energy input than they provide in climate benefits. Investigating existing methods from a sustainability perspective remains crucial; yet the question persists: which pathways should be selected for priority development to maximize both climate impact and economic viability. Future research may address sector-specific bottlenecks while maintaining a systems-level perspective. For example, energy and chemical applications require breakthrough catalysts that operate at lower temperatures and pressures. Building materials need accelerated carbonation techniques and waste stream integration strategies. Only through targeted research addressing these specific challenges can CCU transition from a promising concept to a climate-scale deployment. Urea (1.9 kg net benefit) is a strong near-term option, combining high climate benefit even after re-emissions with highly favorable breakeven costs (-982 to 74 USD/tCO₂). Biodiesel (2.17 kg) also shows high benefit, but only under high financial support (230-920 USD/tCO₂). Bio-methanol varies from low (0.35 kg) under conservative accounting to high (1.9 kg) if biogenic CO₂ re-emissions are treated as neutral^{[25,26,28,29]}. Fossil-based methanol (0.35 kg) and tri-reforming methanol (~0) provide limited cycling benefits. In contrast, cement curing and mineralization ensure durable storage, each avoiding ≥ 1.0 kg CO₂ per kg used with competitive breakeven costs (-30 to 70 USD/tCO₂). CCS achieves permanent storage of ~1.0 kg CO₂ per kg injected, with costs of 30-140 USD/tCO₂. This places CCS as cost-competitive with the most durable CCU options (curing and mineralization), while shorter-lived CCU products generally require higher support to match this benchmark^[2,5]. Table 2 compares CCU pathways with CCS in terms of CO₂ avoidance and breakeven costs.

Renewable energy integration necessitates electrochemical energy storage systems to address intermittency and ensure continuous CCU operation. Lithium-ion batteries provide high energy density (150-250 Wh/kg) and efficiency (> 90%), enabling long-duration storage (4-8 h) that buffers daily solar-wind fluctuations and maintains steady-state operation of energy-intensive conversion processes^[37,38]. Supercapacitors offer complementary advantages - ultra-fast charge-discharge rates (seconds to minutes) and exceptional cycle life (> 1 million cycles) - making them ideal for managing transient power demands during process startup, load changes, and grid stabilization^[39,40]. As CCU scales beyond demonstration plants to industrial deployment (> 100 MW power input), integrating these storage technologies becomes essential not only for operational reliability but also for maximizing renewable energy utilization and achieving the sub- 20 USD/MWh electricity costs required for climate-positive CCU pathways.

Carbon neutrality and reduction pathways

CCU methanol can serve as a carbon-neutral fuel when combusted, as demonstrated by the re-emission scenario (0.35 kg CO₂-eq) - substantially lower than fossil methanol (1.00 kg CO₂-eq) [Figure 3]. However, the avoided emissions benefit drops significantly when CO₂ is released back to the atmosphere compared to production stage avoided emissions (-1.11 kg CO₂-eq). Across both impact categories, CCU methanol demonstrates clear environmental advantages. Global warming is reduced by 65%-210% depending on the stage (production vs. use), while fossil resource scarcity decreases by 87% (0.12 vs. 0.91 kg oil-eq). The emission profile shows that CO₂ capture (-1.46 kg) dominates the carbon benefit, with hydrogen production (0.20 kg) being the primary emission source. These results confirm that CCU methanol outperforms fossil-based methanol across all utilization pathways, with optimal performance achieved through permanent carbon sequestration applications, such as the reutilization of pure CO₂ for cement curing. The breakeven analysis reveals that input cost reduction - particularly electricity prices - is the primary economic driver rather than carbon taxation. At favorable electricity rates (20 USD/MWh), the process achieves profitability (-250 USD breakeven), while at 80 USD/MWh it becomes economically unfeasible (216 USD breakeven). Strategies combining 25% electricity reduction with capital cost optimization or oxygen revenue generation demonstrate greater cost competitiveness than the carbon tax. This indicates that renewable energy costs and electrolyzer efficiency have a greater impact on commercial viability than policy interventions targeting fossil-based product emissions. Consequently, policy mechanisms that directly address feedstock costs - such as Japan's hydrogen contract-for-difference scheme, which subsidizes the price gap between clean and fossil hydrogen - are more effective for CCU deployment than emissions-based instruments such as the European Union’s Carbon Border Adjustment Mechanism (EU CBAM), which primarily penalize carbon intensity without directly reducing the dominant cost drivers of hydrogen and electricity. These instruments are discussed in Section "Bridging the CCU cost gap", bridging the CCU Cost Gap. In addition, a detailed explanation of the calculation methodology, system boundaries and Supplementary Tables 1-4.

Figure 3. CCU methanol: CO₂ avoidance, LCA impacts, and breakeven cost. (A) Avoided CO₂ emissions without re-emission consideration; (B) Avoided CO₂ emissions with re-emission consideration; (C) Global warming impact; (D) Fossil resource scarcity; (E) Breakeven cost under different incentive scenarios. [(A and B) created using Python 3.12 with matplotlib; (C-E) created using Microsoft Excel 365].

This analysis proposes a methodology for evaluating net life-cycle CO₂ emissions in CCU systems by comparing conventional fossil-based production with alternative processes that utilize captured CO₂ as feedstock^[25]. A key premise is that captured CO₂ should not be treated uniformly as a climate benefit; its impact depends on the duration of carbon retention in its final application. The net climate benefit (Net Benefit) is defined as the difference between emissions from conventional (E_conv) and alternative (E_alt) production pathways:

where total emissions from conventional production are given by:

and total emissions from alternative CCU production are calculated as:

Here, E_conv and E_alt denote the total greenhouse gas emissions from conventional and CCU-based production, respectively (kg CO₂-eq). E_prod represents emissions from product manufacturing (fossil-based for conventional systems and renewable-based for CCU systems), E_input refers to emissions associated with material and energy inputs, and E_captured represents the effect of captured CO₂, with its sign depending on whether the application results in temporary use or long-term carbon retention.

Proposed Treatment of Captured CO₂:

Future studies should carefully consider the sign of E_captured based on utilization pathway:

• Negative value (E_captured < 0): Long-term sequestration applications (cement curing, mineralization, polymers: 100+ years) where CO₂ remains permanently bound

• Positive value (E_captured > 0): Short-term release applications (fuels, solvents: days to months) where CO₂ returns to atmosphere

For short-term applications, captured CO₂ should not be credited as a climate benefit, as the carbon is quickly re-emitted. The primary climate advantage in these cases stems from using renewable energy in production (E_prod), which displaces fossil-based processes. Only in permanent sequestration scenarios - such as cement curing or mineralization - should captured CO₂ be treated as a negative emission, representing genuine carbon removal from the atmosphere.

Factors affecting CCU’s environmental performance

The energy intensity of CO₂ capture processes strongly influences the performance of CCU systems. Conventional post-combustion amine scrubbing is widely used for retrofitting power plants. It typically requires 380 kWh per tonne of CO₂ captured, due to the high heat demand for solvent regeneration and CO₂ compression. Direct air capture is attractive for decentralized deployment but far more energy-intensive. This is due to the diluted concentration of CO₂ in the atmosphere. It requires substantial energy for air handling and sorbent regeneration (about 2,000-3,000 kWh per tonne of carbon dioxide), but improvements in sorbent materials, system efficiency, and renewable energy integration can significantly reduce its environmental and economic burdens. In some cases, CO₂ can be used directly from flue gas, such as in microalgae cultivation, avoiding the need for costly purification and thereby reducing upstream energy use. Algae thrive under CO₂-enriched conditions, and flue gas injection has been proposed as a low-cost source of carbon. However, impurities such as SO_x, NO_x, and heavy metals often suppress algal growth and reduce biomass yield, with studies reporting productivity losses of 10%-30% when untreated flue gas is supplied. This trade-off illustrates the balance between reducing energy demand through direct CO₂ use and managing potential negative impacts on process performance^[41,42]. The selection of conversion technology has a profound influence on the choice of chemical production from CO₂. Hydrogenation can achieve commercially viable methanol concentrations at moderate energy demands, whereas electrochemical reduction offers process integration benefits but suffers from prohibitively low yields and extremely high energy consumption. This technological divide determines whether CO₂-to-methanol systems evolve into profitable industrial processes or costly environmental burdens, as hydrogenation already delivers product purities suitable for market deployment. At the same time, electrochemical reduction remains commercially unviable due to fundamental efficiency limitations. Hydrogen supply is another decisive factor for CCU performance, particularly in pathways such as methanol and formic acid synthesis. For instance, methanol production requires three moles of H₂ per mole of CO₂, meaning the environmental footprint of these processes is dominated by the hydrogen source. Conventional “grey” hydrogen from steam methane reforming carries an emissions burden of 9 kg CO₂ per kg H₂, which can offset the carbon reduction potential of CCU products. In contrast, "green" hydrogen from electrolysis powered by renewables requires approximately 50-55 kWh of electricity per kilogram of H₂. When sourced from wind energy, this translates to less than 1 kg CO₂ per kg H₂, thereby enabling near-carbon-neutral pathways^[43]. This difference demonstrates that the climate benefit of CCU is determined mainly by the technology and energy source used for hydrogen production^[25,44].

Electricity demand more broadly also plays a pivotal role in CCU feasibility. Beyond hydrogen production, significant amounts of electricity are consumed in CO₂ capture, compression, and downstream conversion steps. Life-cycle assessments indicate that when powered by fossil-dominated grids, CCU-based products such as methanol or algal biofuels may have higher greenhouse gas footprints than their conventional fossil counterparts. Conversely, when powered by high shares of renewable electricity, the impacts of global warming can be reduced by up to 80%. This highlights the importance of aligning CCU deployment with the decarbonization of the electricity system. Additional systemic factors also influence CCU performance. For example, heat integration using industrial waste heat can reduce capture energy requirements by 20%-25%, thereby improving overall efficiency^[26,31]. While our life-cycle assessment shows that materials and infrastructure contribute only marginally to direct emissions^[25], Sahu et al. (2025)^[45] emphasize that large-scale Power-to-X deployment will depend heavily on critical minerals such as iridium, nickel, copper, and rare earth elements. These material demands introduce supply chain vulnerabilities, economic constraints, and social risks. Thus, although catalytic materials and infrastructure do not significantly increase the carbon footprint, their availability and ethical sourcing remain decisive for the long-term scalability and sustainability of CCU systems.

Mineral and concrete CO₂ utilization is shaped by a combination of technical and environmental factors that influence both the amount of CO₂ absorbed and the overall climate benefit. In concrete, the main drivers are the type and amount of binder materials used - such as ordinary portland cement and supplementary cementitious materials - the method of CO₂ curing or mixing, and, most importantly, the resulting compressive strength compared to conventional concrete. Because concrete performance is measured by compressive strength, any strength gains from CO₂ utilization reduce the binder needed to achieve the same structural performance, thereby enhancing the climate benefit. At the same time, the energy needed for CO₂ curing plays a big role - if energy use is too high, it can cancel out the benefits of carbon fixation. For mineralization, the outcome depends on carefully managing process conditions such as CO₂ concentration in the source gas (flue gas versus purified CO₂), liquid-to-solid ratios, temperature, pressure, reaction time, and gas flow. These parameters control how much CO₂ can be locked into the mineral structure and at what rate. The properties of the resulting mineral, including whether it matches or falls short of the strength and functionality of conventional materials, are crucial since lower performance may require additional material use. Ultimately, the climate impact of both pathways goes beyond the amount of CO₂ stored. It also reflects the energy demands, material inputs, and functional performance of the end product. Achieving real carbon savings, therefore, depends on optimizing binder mixes, curing methods, and mineralization conditions, while also keeping energy use in check and ensuring the materials perform well for their intended purpose^[8].

Barriers to CCU deployment and widespread adoption

CCU continues to face significant barriers that limit its progression from pilot demonstrations to widespread commercial deployment. Many conversion processes remain energy-intensive, with CO₂-to-methanol typically requiring 25-30 gigajoules (GJ) per tonne of CO₂ (~90% for H₂ electrolysis)^[7] and other fuel pathways demanding even higher energy inputs^[46]. Their climate benefit therefore depends on access to abundant, low-cost renewable electricity, which remains scarce in most regions and must also support broader decarbonization priorities such as direct electrification and green hydrogen. Technical limitations persist, including catalyst selectivity below 70% and energy-intensive post-reaction separations, while CO₂ sources pose additional constraints: most industrial flue gases contain only 5%-25% CO₂, and upgrading these dilute streams adds roughly 40-80 USD per tonne to capture costs^[47-49]. CCU-derived products remain substantially more expensive than their fossil-based counterparts, with CO₂-based methanol costing 800-1,200 USD per tonne compared to 300-500 USD per tonne for conventional methanol, implying a need for carbon prices of roughly 150-300 USD per tonne or targeted subsidy schemes to close the gap. These economic and governance gaps intersect with low public awareness and concerns about “greenwashing,” which weaken the social acceptance needed for siting new facilities^[50,51]. Together, these technical, infrastructural, policy, and societal constraints underscore why CCU remains promising yet challenging to scale without coordinated investment, dedicated policy support, and improvements in conversion efficiency and renewable energy availability.

Bridging the CCU cost gap

The cost of CO₂-based products is generally higher than that of conventional fossil-based alternatives, often close to double. This price gap is driven by two dominant factors: electricity costs based on local grid mix prices used for hydrogen production and the expense of CO₂ capture. Addressing these requires both technological innovation and carefully designed policy support. A central factor in the economics of CCU is electricity, and encouragingly, global renewable electricity prices have already dropped significantly in recent years. If these declining costs are fully leveraged, electricity can be supplied at around half of its current average price. Such a reduction could, on its own, bring CO₂-based products much closer to the cost of their conventional counterparts, since electricity accounts for roughly half of the total production costs in many CCU pathways^[52,53].

Feedstock integration is especially promising. Steel plants generate off-gases containing CO₂, H₂, and methane (CH₄), which can be efficiently separated through pressure swing adsorption (PSA). Compared to conventional amine scrubbing applied in cement or power plants, PSA requires less energy and simpler infrastructure, making it a far cheaper capture technology. The separated gases not only provide a stream of CO₂ for utilization but also yield valuable co-products, such as hydrogen and carbon monoxide, that can be used internally or sold, thereby reducing the net cost of CCU operations^[54,55]. Co-locating steel plants with cement or power plants strengthens these synergies. CO₂ captured cheaply via PSA can be combined with larger flue-gas streams from adjacent facilities, reducing feedstock costs and eliminating long-distance transport needs. In parallel, advances in catalysts, reactor design, and system integration continue to reduce both energy intensity and capital costs [Figure 4]. As plants scale up, fixed expenditures can be spread across higher production volumes, further lowering the unit cost of CO₂-based products. Another way to obtain low-cost CO₂ is to produce ethanol via the fermentation of sugar^[20]. This process not only provides a low-carbon fuel but also generates a significant stream of high-purity biogenic CO₂. Since this CO₂ originates from atmospheric carbon fixed by crops, its release is considered climate-neutral. Capturing and utilizing this fermentation-derived CO₂ presents an additional opportunity to reduce the already small carbon footprint of sugarcane and corn ethanol, particularly in regions such as Brazil, where best practices and renewable energy inputs are widely adopted. Further assessment of the techno-economic and environmental benefits of this pathway is necessary to fully realize its potential^[56].

Figure 4. Pathways to reduce the high cost of CO₂-based products and improve CCU competitiveness. (Created using Microsoft PowerPoint 365).

An emission-based carbon tax directly penalizes products in proportion to their carbon intensity. For example, methanol production emits approximately 0.45 tonnes of CO₂ per tonne of product. At 300 USD per tonne of CO₂, this adds 135 USD to the conventional methanol cost of approximately 400 USD, bringing the total to about 535 USD, which remains below the 750-1,000 USD range for CCU-based methanol. However, urea production emits 2.5 tonnes of CO₂ per tonne of product, generating a 750 USD tax burden that creates an excessive cost gap when the initial price difference between green and conventional urea is only 70 USD^[2]. This approach yields uneven impacts: high-emission products, such as urea, bear disproportionate penalties, while lower-emission products, such as methanol, experience limited competitive benefits. This unevenness can create sectoral distortions and often requires politically difficult carbon prices to meaningfully shift market competitiveness. An alternative applies a uniform levy directly to fossil-based products based on quantity rather than emissions intensity. This eliminates significant discrepancies between high- and low-emission products, resulting in more straightforward, predictable adjustments. The levy could be set based on the specific cost difference between conventional and CCU alternatives, ensuring cleaner products can compete on a level playing field without extreme price signals^[24].

The EU CBAM and the United States Section 45Q tax credit are emissions-linked mechanisms. The EU CBAM ties import costs directly to the embedded emissions at prices set by the European Union Emissions Trading System (EU ETS), currently in the range of €50-80 per tonne. The Section 45Q policy in the United States provides tax credits of USD 85 per tonne for geological storage and USD 180 per tonne for direct air capture and storage. Both approaches penalize or reward actions in proportion to carbon intensity. In contrast, Japan’s Green Transformation (GX) hydrogen contract-for-difference scheme does not focus on emissions intensity. Instead, the government pays the direct price gap between fossil-based hydrogen and clean hydrogen, typically in the range of USD 1-5 per kilogram. This ensures predictable cost adjustments without the disproportionate penalties that emissions-based instruments can impose on highly carbon-intensive products such as urea. A different category is represented by Puro.earth, which operates as a third-party certification and marketplace for durable carbon removals. It verifies and issues credits for methods that store carbon for more than 100 years, such as biochar. Puro.earth has been active since 2019 and was central to Microsoft’s landmark deal with Exomad Green to purchase 1.24 million tonnes of certified carbon removal, of which more than 120,000 tonnes have already been delivered. Together, these instruments illustrate two distinct policy logics: one based on emission-intensity pricing signals, which can lead to uneven sectoral impacts, and another based on direct cost equalization, which directly addresses the price gap between conventional and low-carbon products. Overall, for CCU to achieve large-scale deployment, combining these approaches with falling renewable energy costs, feedstock integration, and technology improvements will be essential to close the current cost-price gap^[20]. These different policy instruments are vital in enabling CCU to transition from costly pilot systems to viable industrial solutions. The EU’s Carbon Border Adjustment Mechanism and the U.S. Section 45Q tax credit strengthen CCU competitiveness by linking financial incentives directly to CO₂ reductions, while Japan’s GX hydrogen contract-for-difference scheme narrows the price gap between fossil and clean hydrogen, accelerating hydrogen-based CCU pathways such as methanol and formic acid. Meanwhile, certification markets such as Puro.earth promote long-term carbon storage and reward durability. Together, these complementary policies - carbon pricing, cost-gap subsidies, and certification mechanisms - create the financial foundation for scaling CCU deployment and integrating it into national and global decarbonization strategies [Table 3].

On the other hand, cement curing with CO₂ is one of the most economically promising and climate-beneficial CCU pathways. It is already close to cost-competitive and has large-scale CO₂ storage potential. The main challenges are technical (strength consistency), regulatory adoption, and the emissions from cement calcination. If coupled with low-carbon energy, CO₂ curing could be a cornerstone CCU solution^[8,27].

The prospects for CCU are becoming increasingly robust as renewable electricity, green hydrogen, and CO₂-derived methanol move toward cost-competitiveness and large-scale deployment. Between 2010 and 2023, the global weighted average levelized cost of electricity for utility-scale solar photovoltaic (PV) declined by about 90% to 0.044 USD/kWh, while that of onshore wind decreased by approximately 70% to 0.033 USD/kWh. By 2030, the combined share of wind and solar PV in global electricity generation is expected to double to around 30%, and by 2050 renewables are projected to supply nearly 90% of global power, with solar and wind alone contributing close to 70%^[2]. These dynamics underpin the emergence of affordable green hydrogen, with electrolytic production costs projected to fall below 2 USD/kg in optimal regions by 2030 and to reach approximately 1-2 USD/kg by 2050 as electrolyzer technologies mature. This downward cost trajectory supports rapid methanol scale-up, with production costs expected to decline from 640-730 USD/t in 2030 to 250-630 USD/t by 2050, progressively narrowing the gap with fossil methanol. Deployment is already underway, with about 41 million tonnes/year of projects planned for 2030 and as much as 385 million tonnes/year anticipated by 2050^[62,63]. Rapid scale-up of CCUS in the 2020s, supported by private investment and public policy, is essential for the technology to play its vital role in net zero, with capacity needing to reach 7-10 Gt CO₂ per year by 2050^[64]. This deployment will primarily focus on permanent geological storage (approximately 95%) rather than its use in products (approximately 5%), reflecting both the massive scale required to meet climate objectives and the practical limitations of CO₂ conversion pathways.

While CCU represents a smaller fraction of total CCUS capacity, its strategic value extends beyond volume metrics through its ability to create permanent carbon locks and prevent future emissions. CCU applications offer multiple pathways for durable carbon management: converting CO₂ into essential chemicals such as urea and methanol displaces fossil-based production, utilizing CO₂ as a hydrogen carrier enables clean energy transport and storage, and embedding CO₂ in cement and building materials creates permanent sequestration within infrastructure. These diverse applications collectively establish robust carbon utilization networks that not only avoid emissions from conventional production but also lock carbon away from the atmosphere for extended periods. Rather than viewing CCU as a marginal complement to storage, this perspective positions it as a strategic multiplier that transforms CO₂ from waste into valuable resources while simultaneously achieving permanent emission reductions across multiple industrial sectors [Table 4].

Actionable pathways

• Integrated infrastructure: Deploy regional hydrogen-CCU hubs that co-locate electrolysis, conversion, and regeneration to improve efficiency and enable cascading utilization pathways.

• Standardized assessment: Develop temporal LCA frameworks that quantify storage duration and enable consistent benchmarking of CCU against CCS, DACCS, and BECCS in terms of permanence, cost, and scalability.

• Industrial symbiosis: Co-locate CCU with high-purity biogenic CO₂ sources and create hybrid CCU-CCS systems allowing flexible allocation between utilization and geological storage.

• Policy innovation: Prioritize feedstock-based subsidies over emissions-only pricing and implement tiered incentives rewarding both utilization and verified permanent storage.

• Technology development: Focus on low-energy catalysts, improved reactor designs, and integrated models identifying least-cost regional solutions with transparent certification frameworks.

The next decade will determine whether CCU remains peripheral or becomes central to industrial decarbonization. Success depends on connecting hydrogen infrastructure, implementing standardized temporal assessment, and deploying effective policy mechanisms that transform CO₂ from an environmental liability into a managed resource within a circular carbon economy.