Carbon Capture, Utilisation and Storage (CCUS) are an important set of technologies to achieve Scotland’s net-zero targets. 

CO₂ utilisation is thought to be a complementary technology to CO₂ sequestration. Whilst geological sequestration can permanently store CO₂, CO₂ utilisation can be used to produce conventional products such as carbon containing fuels, chemicals, and polymers without reliance on additional extraction of fossil carbon. It is therefore of interest for sustainable manufacturing and the circular use of resources, particularly if biogenic or atmospheric CO₂ is utilised.

A large number of technology pathways are available for development in Scotland. This report explores these pathways based on development stage, feasibility and economic opportunity.

Main findings

• Gas fermentation and microalgae growth techniques could build on Scottish expertise and have local product markets in aquaculture.
• Synthetic fuels could benefit from Scottish renewable electricity and have large European market potential.
• Carbon nanomaterials are an emerging opportunity linked to high-value lightweight materials and manufacturing of electrical devices.

Factors to consider for Scotland to unlock the full potential of CO₂-utilisation:

• Funding will be required to increase the Technology Readiness Level.
• CO₂ utilisation may benefit dispersed sites or small-scale emitters where capture, transport & sequestration is challenging.
• CO₂ utilisation can offer economic opportunities for emitters of biogenic CO2 able to easily capture their emissions (e.g. distilleries).
• The relevant scale and investment requirements vary with technology and application.
• Whilst some products can be cost-competitive and feed directly into local supply chains, other products require new policy incentives or development of new applications.
• Close integration of value chains and synergies with existing industries should be considered when locating utilisation projects.

In 2019, Scotland committed to achieving net-zero greenhouse gas emissions by 2045. This commitment will require the decarbonisation of all sectors, including industry. To address decarbonisation in industry, initial targets up to 2032 were established in the 2018 Climate Change Plan (CCP).  

In addition to these targets, energy efficiency is a core priority in the Scottish national agenda and is clearly outlined in the Energy Efficient Scotland route map to 2040. The route map makes a clear commitment to work in collaboration with energy-intensive industries (EIIs), to provide incentives for operations to become more energy efficient or to decarbonise, and to address the specific needs of industry.

In line with these commitments, the Scottish Government is working to create the right conditions to support investment in industrial decarbonisation. Such conditions require the reduction of industrial emissions while maintaining a competitive and healthy industrial sector, where decarbonisation is not achieved at the expense of loss of output, jobs or skills. In particular, the Scottish Government aims to minimise ‘carbon leakage’, whereby production is moved to other countries with laxer emissions controls.

This research aims to further understanding of industrial decarbonisation projects in Scottish EIIs, to catalogue the pipeline of such projects, and identify overarching decarbonisation themes.

It also aims to assess how projects are likely to develop over a 10-year timescale. Barriers, enablers and gaps in industrial decarbonisation in the listed themes are identified through understanding how decarbonisation technologies are adopted in Scotland, based on stakeholder engagement. The final objective is to inform the most likely development pathways and gauge the influence of external factors on optimal project sequencing.

Key recommendations for the short and medium term

Short term: These recommendations should be considered for adoption in the short term, as their function is to shape ongoing work on funding and support programmes, and raise awareness at an enterprise level for industrial decarbonisation.   

• Recommendation 1: The creation of a single portal through which Scottish industrial sites can access all funding schemes, supporting documents and guidelines. Sites need high-quality advice and support to minimise the lack of capacity which currently exists to work through the complexities of the policy and funding landscape. 
• Recommendation 2: In the private sector, adapting business and corporate strategies to emphasise energy efficiency, decarbonisation, and sustainability programmes is a key goal. Influencing key executives and ensuring these programmes play an integral role in future business competitiveness will encourage business leaders to prioritise them.
• Recommendation 3: Funding programmes and any other financial mechanisms which are developed should be flexible enough to ensure they account for the specific contexts and issues of each applicable industrial sector. 

Medium term: These require considerable preparation and cross-collaboration between industry, the government and other stakeholders as well as additional studies to better understand the socioeconomic implications.

• Recommendation 4: Implementation of a business model within a supportive economic framework to reduce the ongoing costs experienced by industrial decarbonisation projects in Scotland. While this is likely to fall somewhat under the UK Government, Scottish Government needs to ensure that this is fit for purpose in the Scottish specific context.
• Recommendation 5: A collaborative approach to technology and project development across Scottish (and wider UK) industry. Coordinating the effort between companies in a way that does not impact upon their individual competitiveness can achieve synergies and maximise the ‘learning by doing’ achieved in projects. 
• Recommendation 6: Specific focus should be paid to deeper decarbonisation projects (and the large-scale infrastructure projects necessary to enable these) as their success is critical to meeting net-zero targets while retaining Scottish industry. To achieve these, ongoing economic support for these projects must reach the critical level and be guaranteed over a long time period.