Given the lead time to get some of the emission abatement projects in place – whether it be renewable power or hydrogen with carbon capture – many of the 2030 goals that we see, like the LyondellBasell chart below – are likely to be just that – plans for 2030, with not much in the years in between. We see very little CCS coming online in the US over the next 5 years because of permitting and because of the lead time for any large hydrogen or power project that might be associated with the CCS. Not too many companies seem interested in cleaning up existing CO2 streams and are more interested in building alternative capacity that generates easier to capture CO2 – such as hydrogen from an ATR. These are expensive and long lead-time projects. LyondellBasell, ExxonMobil, Dow, and others might meet their 2030 targets but it might all happen in 2029/30.
Source: LyondellBasell, April 2022
The emissions forecasts by the EIA in the chart below from US energy are part of what the IPCC (covered in today’s ESG report) is pointing to when they say that not enough is being done. As we note above, CCS is going to be a late decade even at scale in the US, assuming that it gets support now, and wind and solar have cost and logistic issues that suggest they will fall short of what we need by a wide margin. There is no easy fix here as renewable fuels are likely to be only incremental over the next several years, with several initiatives and new companies needing to prove the first plant before they can invest at scale.
Source: EIA – Short-Term Energy Outlook, April 2022
