Why in the News?

The Union Budget has, for the first time, made a large, dedicated fiscal commitment of ₹20,000 crore to carbon capture, utilisation and storage. This marks a shift from pilot-driven experimentation to scale-oriented deployment. The urgency is underscored by global data showing 1 billion tonnes of annual CO₂ capture required by 2030, while only 50 million tonnes are currently captured worldwide. India’s net-zero pathway increasingly depends on CCUS as emissions from cement, steel and chemicals cannot be eliminated through renewable energy substitution alone.

What is Carbon Capture, Utilisation and Storage?

1. It refers to technologies that capture CO₂ from industrial processes, transport it, and either store it in geological formations or convert it into useful products.
2. Process Stages: CCUS involves capturing carbon dioxide (via post-combustion, pre-combustion, or oxy-fuel combustion), transporting it, and either using it for industrial applications or storing it permanently
3. Role in Climate Change: It is essential for decarbonizing “hard-to-abate” sectors, including steel, cement, and chemical production, which account for significant global emissions.
4. Carbon Removal: CCUS enables negative emissions through technologies like Bioenergy with Carbon Capture and Storage (BECCS) and Direct Air Capture (DACCS).
5. Challenges: High capital costs, energy intensity (high auxiliary power consumption), safety concerns, and infrastructure needs for transport are major bottlenecks.

What Does Carbon Capture, Utilisation and Storage Involve?

1. Carbon Capture: Enables separation of CO₂ from industrial exhaust streams in cement, steel, power and refining operations.
2. Carbon Storage: Facilitates long-term containment of CO₂ in geological formations such as depleted oil and gas reservoirs.
3. Carbon Utilisation: Supports conversion of captured CO₂ into chemicals and industrial inputs, reducing fresh fossil use.

Why Is CCUS Critical for Achieving Net-Zero?

1. Hard-to-Abate Emissions: Addresses emissions that arise from chemical reactions in cement and steel, not from fuel combustion.
2. Limits of Renewables: Recognises that shifting to renewable electricity does not eliminate process emissions in heavy industry.
3. Climate Mitigation: Enables deep emissions reduction without compromising industrial output and economic growth.

What Is the Current Global Status of Carbon Capture?

1. Operational Capacity: Includes 45 commercial CCUS facilities worldwide.
2. Captured Volume: Accounts for only 50 million tonnes of CO₂ annually, far below climate targets.
3. 2030 Requirement: Indicates a need for 1 billion tonnes of CO₂ capture per year by 2030 to align with net-zero pathways.
4. Deployment Gap: Highlights a sharp mismatch between climate targets and present technological scale.

What Is the Status of CCUS Technologies in India?

1. Pilot Projects: Includes initiatives by Tata Steel, Dalmia Cement, NTPC, ONGC, focusing on capture feasibility.
2. Research Ecosystem: Involves dozens of research groups working on capture materials and processes.
3. Institutional Leadership: Anchored by Centres of Excellence at Indian Institute of Technology Bombay and Jawaharlal Nehru Centre for Advanced Scientific Research, focusing on indigenous CCUS solutions.
4. Readiness Gap: Indicates laboratory-level maturity but limited field-scale testing.

How Does the Union Budget Change the CCUS Landscape?

1. Fiscal Allocation: Provides ₹20,000 crore for CCUS technology development and deployment.
2. Scale Transition: Signals movement from pilot projects to industrial demonstration.
3. Cost Reduction: Aims to address high capital and operational costs that restrict commercial viability.
4. Industrial Adoption: Targets steel, cement, refineries and chemicals as early adopters.

Why Are Certain Industries Central to CCUS Deployment?

1. Cement Sector: Generates CO₂ as an inherent by-product of limestone calcination.
2. Steel Sector: Emits carbon through coke-based reduction processes.
3. Chemical and Refining Industries: Produce process emissions independent of energy source.
4. Competitiveness: Aligns emission reduction with global trade requirements, including carbon border measures.

What Are the Economic and Strategic Benefits of CCUS?

1. Industrial Continuity: Enables emission reduction without relocating or shutting down core industries.
2. Global Competitiveness: Reduces exposure to mechanisms such as the EU’s Carbon Border Adjustment Mechanism.
3. Technology Leadership: Positions India as a developer, not just adopter, of CCUS technologies.
4. Cost Containment: Prevents loss of competitiveness from carbon-intensive exports.

Conclusion

CCUS is not a substitute for renewable energy but a necessary complement for India’s net-zero strategy. The Budget’s ₹20,000 crore allocation marks a decisive shift from experimentation to scale. However, success depends on rapid field deployment, cost reduction, and industry integration to ensure CCUS delivers measurable emissions reduction by 2030.

PYQ Relevance

[UPSC 2025] What is Carbon Capture, Utilization and Storage (CCUS)? What is the potential role of CCUS in tackling climate change? 

Linkage: This question is directly linked to GS III (Environment, Climate Change, Clean Technologies), reflecting UPSC’s focus on technological pathways for achieving net-zero and decarbonising hard-to-abate industries.

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