Carbon Capture, Utilisation and Storage: A crucial bridge to net-zero for India and the world

Growing Role of CCUS in Climate Strategy

Carbon Capture, Utilisation and Storage (CCUS) is a critical technology that offers a practical solution to reduce carbon emissions from industries where direct electrification or a switch to renewables is not yet feasible. By capturing CO₂ at the source—such as power plants, cement kilns, and steel factories—or even directly from the air, and either storing it underground or converting it into useful products like methanol or building materials, CCUS helps lower the carbon footprint without disrupting existing industrial operations. As the world races toward net-zero goals, CCUS is increasingly viewed as a critical bridge technology to complement renewable energy and drive deep decarbonisation.

CCUS has gained significant traction globally as countries look for technological solutions to reduce greenhouse gas emissions from hard-to-abate sectors. As of 2024, there are approximately 45 commercial carbon capture, utilization, and storage (CCUS) facilities in operation globally, collectively capturing over 50 million tonnes of CO₂ annually.

• The United States leads the global charge with the highest number of operational projects, backed by robust policy incentives like the 45Q tax credit (The U.S. Section 45Q tax credit provides financial incentives for capturing and either storing or utilizing carbon oxides, offering up to $85 per metric ton for geologic storage and $60 per metric ton for utilization, thereby promoting investment in carbon capture projects).

• Other frontrunners include Norway, which has invested heavily in the Longship project and Northern Lights CO₂ transport and storage infrastructure. (Northern Lights is the world’s first cross-border CO₂ transport and storage facility, officially opened in September 2024, with an initial capacity to store 1.5 million tonnes of CO₂ per year)

• Canada is home to one of the world’s longest-running commercial CCUS projects at the Boundary Dam Power Station in Saskatchewan. In 2014, SaskPower retrofitted Unit #3 of the power stations with carbon capture and storage technology, making it the first power station globally to successfully implement CCS technology. Since its inception, the facility has captured and prevented over 6.5 million tonnes of CO₂ emissions.

• China‘s commitment to carbon neutrality was officially announced by President Xi Jinping during the UN General Assembly in September 2020. The pledge includes peaking carbon dioxide emissions before 2030 and achieving carbon neutrality by 2060.

The global CCUS market is projected to reach USD 51.8 billion by 2050, driven by net-zero goals, supportive policies, and decarbonization of heavy industries. Asia Pacific, especially China and India, is expected to see strong growth amid rising investments and tech advancements.

While the technology is still expensive and evolving, CCUS is increasingly seen as indispensable for achieving net-zero targets—particularly in sectors like cement, steel, and chemicals where emissions are process-inherent and not easily mitigated by renewable energy alone. Multilateral efforts like the Clean Energy Ministerial’s CCUS Initiative and Mission Innovation’s Carbon Capture stream have facilitated knowledge-sharing platforms and encouraged public-private investments in CCUS technologies.

As the world moves towards decarbonisation, India is stepping up its efforts to tackle emissions through Carbon Capture, Utilisation, and Storage (CCUS) technologies. The country is making significant strides in deploying CCUS to mitigate carbon dioxide (CO₂) emissions and meet its net-zero targets. The government’s commitment is evident in policy developments, pilot projects, and international collaborations aimed at integrating these technologies across various industrial sectors. With ambitious climate goals—net zero by 2070 and a 45% reduction in emissions intensity of GDP by 2030—CCUS has become a vital part of India’s climate action strategy.

India, though relatively new to large-scale deployment, is beginning to lay the groundwork for CCUS integration into its climate strategy. India recognises the importance of CCUS in decarbonising core industries and ensuring energy security. Pilot projects led by NTPC, Oil and Natural Gas Corporation (ONGC), and industrial players like Tata Steel signal growing interest. However, compared to global leaders, India remains in the early stages and will require strong policy support, technology partnerships, and financing mechanisms to scale its efforts effectively.

In November 2022, NITI Aayog released a comprehensive report titled “Carbon Capture, Utilisation, and Storage (CCUS) Policy Framework and its Deployment Mechanism in India.” This document outlines India’s vision for deploying CCUS technologies to enable a circular carbon economy. Key features of the framework include:​ 

• Establishing policy and regulatory clarity to attract private sector investment.

• Promoting public-private partnerships in large-scale demonstration projects.

• Developing a national inventory of CO₂ sources and potential storage sites.

• Leveraging CCUS for blue hydrogen production and industrial decarbonization.

Unlocking CCUS Potential in India

There exists significant opportunities for the development of CCUS technologies India, given its growing energy demands and the carbon intensity of its industrial sector. CCUS offers a way to decarbonise hard-to-abate industries such as cement, steel, fertilisers, and petrochemicals, which together account for a large share of India’s emissions. With a strong pipeline of industrial projects and a commitment to reaching net-zero emissions by 2070, there is a clear and pressing need for scalable solutions like CCUS. Moreover, India has promising potential for geological storage in depleted oil and gas reservoirs and saline aquifers, as well as growing interest in CO₂ utilisation routes such as methanol production, urea synthesis, and building materials.

According to the IEA, India is the third-largest emitter of greenhouse gases globally, primarily due to its dependence on coal for power generation and heavy industries like steel, cement, and refining. Despite this, its per capita emissions remain below the global average. As energy demand rises, India is ramping up renewable energy efforts, but some emissions remain hard to abate—making CCUS a vital solution to capture carbon before it enters the atmosphere and support the country’s clean energy transition.

The private sector stands to benefit from early investments in CCUS through technology partnerships, innovation, and the creation of new value chains. Companies can explore opportunities in CO₂ capture technologies, carbon-to-chemical solutions, and carbon credit markets. Industrial players like Tata Steel, JSW Cement, and NTPC have already initiated pilot projects, setting the stage for broader commercial adoption. Private sector innovation, especially in low-cost capture methods and modular solutions for smaller emitters, could drive down costs and open new markets. Additionally, start-ups and cleantech companies have room to develop business models around CO₂ utilisation, such as producing green fuels or building materials.

However, the public sector has a crucial role to play in de-risking early investments and laying the foundation for a viable CCUS ecosystem. This includes funding large-scale demonstration projects, setting up shared CO₂ transport and storage infrastructure, and creating a clear and stable regulatory framework. The government also needs to establish carbon pricing mechanisms or incentives that make CCUS financially attractive and ensure long-term viability. Furthermore, public sector research institutions can support innovation, while policy interventions can drive awareness and encourage adoption across diverse industrial sectors. A coordinated approach, with the public sector providing policy direction and infrastructure, and the private sector leading on technology and implementation, will be key to realising the full potential of CCUS in India.

Evolving CCUS Policy Landscape

The Indian government is actively developing a comprehensive policy framework for Carbon Capture, Utilization, and Storage (CCUS), with the Power Ministry designated as the nodal agency. This initiative aims to address critical aspects such as capture standards, transportation, storage, CO₂ utilization, and the establishment of a national information portal. Additionally, the policy will incorporate emission goals, life-cycle assessments, and integration with India’s carbon market. 

India’s Ministry of Power and NITI Aayog have recognised the role of CCUS in decarbonising the economy. In 2023, the Department of Science and Technology launched the national mission on CCUS R&D, focusing on innovation and pilot projects. Policy frameworks are being developed to support investment, technology transfer, and carbon markets.

India submitted its Long-Term Low Emission Development Strategy (LT-LEDS) to the United Nations Framework Convention on Climate Change (UNFCCC) during the 27th Conference of Parties (COP27) in November 2022. The LT-LEDS is a strategic document submitted by countries under the Paris Agreement framework. It outlines a country’s vision, policies, and pathways for achieving long-term climate goals. India’s strategy includes Carbon Capture, Utilisation and Storage (CCUS) as a critical technology for achieving net-zero emissions by 2070. It also outlines approaches for low-carbon development, highlighting the role of CCUS in decarbonizing key sectors.

The country aims for 750 million tonnes/year CCUS capacity by 2050, requiring $100–150 billion in investment. Key focus sectors include steel, cement, petrochemicals, and other high-emission industries.

CCUS Pilots Projects in India

Several public and private sector entities in India have initiated pilot projects and research collaborations to explore and deploy CCUS technologies. The table below highlights some of the key initiatives currently underway across industries and regions.

Organisation	Project Location	Project Description	Partners/ Technology	Source
ONGC	Gandhar field, Gujarat	Capturing CO₂ from IOC Koyali refinery for Enhanced Oil Recovery (EOR)	IOC	link
IOC	Koyali Refinery, Gujarat	Feasibility study for capturing 0.7 MTPA CO₂ from hydrogen units for EOR and food industry	Dastur, ONGC, OIL	link
OIL	Digboi Refinery & Naharkatiya Oilfield, Assam	CO₂ capture for EOR in Barail Sand reservoirs	IOC (MoU), Gas Turbine & HGU capture	link
JSW Steel	Vijayanagar, Karnataka	Study to deploy CycloneCC to capture 100,000 TPA CO₂	BHP, Carbon Clean	link
SAIL	Various (MoU covers all plants)	R&D on hydrogen and biochar use in steelmaking	BHP	link
Fugro	Visakhapatnam, Andhra Pradesh	CCS feasibility at pharmaceutical site	Eco Carbon, Visakha Pharma City, IIT Bombay	link
Tata Steel	Jamshedpur, Jharkhand	5 TPD capture from blast furnace gas with reuse on-site	Carbon Clean; MoU with CSIR	link
NTPC	Vindhyachal, Madhya Pradesh	Pilot: 20 TPD CO₂ capture and methanol synthesis	NETRA, Carbon Clean, Green Power Intl.	link
NTPC + IIT Bombay	Various coalfields (under study)	Geological CO₂ storage potential and CO₂ Storage Atlas	National Centre of Excellence in carbon capture and utilization (NCoE-CCU) (IIT Bombay)	link
Reliance Industries	Not specified	Exploring CCU for chemicals and alternative fuels	In-house innovation	link
NCL Pune + IIT Bombay	Research facilities	R&D on solvent/adsorption-based CO₂ capture	Department of Science and Technology (DST), National Centre of Excellence in carbon capture and utilization (NCoE-CCU), UK Research and Innovation (UKRI) support	link

Strengthening Through Partnerships

India has been actively engaging in international partnerships to bolster its Carbon Capture, Utilization, and Storage (CCUS) capabilities. Here are some recent developments:​

• Global Collaboration at the World Energy Congress: In April 2024, during the 26th World Energy Congress in Rotterdam, India’s Power Secretary emphasized the importance of CCUS and green hydrogen in India’s energy strategy. He advocated for increased international cooperation and advanced technology adoption to manage the global energy landscape effectively. The congress highlighted significant energy transition endeavors and encouraged dialogue on interconnected energy systems.

• India–U.S. Strategic Clean Energy Partnership (SCEP): In August 2023, India and the United States convened the Strategic Clean Energy Partnership Ministerial in Washington, D.C., to advance collaboration on clean energy technologies, including CCUS. The partnership aims to accelerate the development and deployment of emerging clean energy technologies, such as CCUS, to decarbonize high-emitting sectors like industry, buildings, and transport. The ministers welcomed progress made under the partnership to drive clean energy innovation, strengthen energy security, and accelerate clean energy transitions.

• International Collaboration in the Cement Sector: India has collaborated with international organizations like the Global Cement and Concrete Association (GCCA), the Global CCS Institute (GCCSI), and the Clean Energy Ministerial (CEM) CCUS Initiative to decarbonize its cement industry. This collaboration focuses on identifying potential CCUS hub locations, defining policy and financing frameworks for bankable projects, and supporting feasibility studies for first-mover projects. The initiative aims to build awareness and capacity within the cement sector regarding the role of CCUS in decarbonization.

• European Support: A European team of carbon removal specialists, known as “remove,” has initiated efforts to assist Indian businesses in developing carbon dioxide removal projects, focusing on biochar production and enhanced weathering.

• Google and Varaha: Google has entered into an agreement with Indian supplier Varaha to purchase carbon credits derived from an initiative that transforms agricultural waste into biochar, integrating it into the soil to sequester CO₂.

Challenges and Global Lessons for Scaling CCUS in India

There are several critical challenges in implementing and scaling up CCUS technologies. One of the foremost barriers is the high cost of capture technologies, particularly for small and medium industrial units. Carbon capture remains capital-intensive, and without strong financial incentives, subsidies, or carbon pricing mechanisms, private sector players may find it economically unviable to invest in large-scale CCUS projects.

Another major hurdle is the lack of infrastructure for CO₂ transport and storage. Unlike countries with established pipeline networks and identified geological storage basins, India is still in the early stages of mapping suitable storage sites, such as depleted oil and gas fields or deep saline aquifers. There are also regulatory gaps, especially concerning the long-term monitoring, liability, and environmental safety of CO₂ storage. The absence of a comprehensive legal and institutional framework for CCUS adds to investor uncertainty and delays deployment.

Public awareness and industry readiness on CCUS is limited, often leading to skepticism about its safety, effectiveness, and role in India’s broader climate strategy. The fragmented nature of India’s industrial base, with many smaller emitters, further complicates coordinated implementation. Overcoming these challenges will require targeted policy support, capacity-building initiatives, international collaboration, and demonstration projects that prove both the technical and economic viability of CCUS in the Indian context.

Several countries have adopted innovative approaches that offer lessons for overcoming these challenges. For instance, Norway’s Longship project combines government funding with private sector investment to build full-chain CCUS infrastructure, including CO₂ capture, transport, and offshore storage, setting a precedent for public-private collaboration. The U.S. has introduced tax credits under the 45Q program, offering substantial incentives for every tonne of CO₂ captured and stored or utilized, making CCUS more financially attractive. Netherlands and the UK have established national CO₂ transport and storage hubs, such as the Porthos and East Coast Cluster projects, which enable shared infrastructure to reduce costs and facilitate access for multiple emitters. On the regulatory front, Canada has developed robust frameworks for monitoring and liability in long-term CO₂ storage, building public and investor confidence. These examples highlight the importance of strong policy support, centralized infrastructure planning, and financial mechanisms that India can adapt to scale up its CCUS efforts.

Conclusion

India’s carbon capture drive is still in the early stages, but momentum is building. With the right policy push, technological innovation, and financial support, CCUS can become a crucial part of India’s toolkit for meeting climate targets while sustaining economic growth.

As the country ramps up its green industrial transition, integrating CCUS into the broader energy and industrial ecosystem—alongside renewable energy and green hydrogen—will be vital to ensuring a just and inclusive low-carbon future.

For India, CCUS is not just about climate—it’s also about energy security, economic development, and industrial innovation. As costs come down and technologies mature, carbon capture could become a game-changer in India’s clean energy journey.

Extra References

• https://www.dghindia.gov.in/assets/downloads/ar/2023-24/205/

• https://www.niti.gov.in/sites/default/files/2023-02/Annual-Report-2022-2023-English_1.pdf

• https://www.iea.org/data-and-statistics/data-tools/ccus-projects-explorer

• https://www.globalccsinstitute.com/wp-content/uploads/2024/11/PLR-Review-Report_FINAL.pdf

• https://ntpc.co.in/media/press-releases/carbon-capture-utilization-and-storage-ccus-ntpc-initiative

• https://cleantechhero.com/varaha-partners-with-google-for-100000-biochar-carbon-removal-credits/

Also read: Varaha sells over 60,000 tonnes of carbon credits to Klimate