India Commits Rs 20,000 Crore to Carbon Capture, Utilisation, and Storage: A New Era in Environmental Innovation
In a significant move towards combating climate change, India has earmarked Rs 20,000 crore in its recent Union budget for Carbon Capture, Utilisation, and Storage (CCUS). This ambitious investment aims to roll out CCUS technologies over the next five years across crucial sectors, including chemicals, power, steel, cement, and refineries.
Understanding Carbon Capture, Utilisation, and Storage (CCUS)
CCUS refers to a suite of technologies designed to capture carbon dioxide (CO2) emissions from various sources. Once captured, CO2 can either be utilized in creating valuable products or stored underground to prevent its release into the atmosphere. Though adopted to some extent globally, CCUS currently captures only about 0.1% of all emissions, equating to roughly 50 million metric tons of CO2.
Internationally, countries such as the US, Germany, Japan, and others are ramping up their CCUS infrastructure. Projections indicate that to limit global warming to 1.5 degrees Celsius, CCUS must escalate its capture rate substantially, hitting around 1 billion metric tons of CO2 by 2030, and several billion tons by 2050.
India’s CCUS Roadmap: Challenges Ahead
India faces a daunting task as it gears up to capture about 11.4 GtCO2e cumulatively from industrial sectors by 2070. However, the country currently exerts a “negligible amount” of mitigation due to the immature nature of these technologies. The CCUS roadmap, published in December 2025, identifies several hurdles, including high costs, additional energy penalties, storage challenges for CO2, and the pressing need for more research and development.
Despite these challenges, India’s commitment marks its first significant step into this emerging technology landscape, a move that raises both expectations and concerns. Critics argue that past CCUS projects have often fallen short on technical and economic grounds, citing issues like high costs, low capture rates, and the risk of stranded assets.
Expert Insights: The Future of CCUS in India
To delve deeper into the implications of India’s investment in CCUS, IndiaSpend consulted Vikram Vishal, convener of the National Centre of Excellence in CCUS at IIT Bombay. As a leading figure in this field, he has extensive experience researching carbon capture and has contributed to various government initiatives.
Vishal emphasized the significance of the ongoing flagship project between NTPC and IIT Bombay, involving India’s first CO2 storage well. This project aims to assess the viability of geological storage in sedimentary formations, which is crucial as larger-scale adoption of CCUS becomes inevitable.
The Technical Framework: Geological Sequestration
Geological sequestration involves storing CO2 underground in formations like coal and sandstone. The NTPC project with IIT Bombay aims to ensure the feasibility of local geological sites. Following the drilling of test wells, the next phase will involve injecting CO2 into one well while monitoring it from another. This will help determine not only the suitability of the site but also ensure the CO2 remains securely contained.
Addressing the question of leakage risks, Vishal assured that numerous layers of security are built into the storage design, ensuring that CO2 does not escape into the atmosphere.
Sector-Specific Applications of CCUS
When asked which sectors are most suited for immediate scaling of CCUS technology, Vishal highlighted the power sector as a major emitter, accounting for nearly a third of total emissions. Steel and cement industries also emerged as critical players, particularly in light of international pressure to decarbonize these sectors due to regulations like the European Union’s Carbon Border Adjustment Mechanism.
Energy Considerations and Efficiency
One of the prominent challenges of CCUS is the “energy penalty,” where capturing and storing CO2 can result in reduced plant efficiency. Vishal indicated that utilizing innovative processes, such as directly converting flue gas into products without extracting pure CO2, might mitigate some of this energy loss. Furthermore, integrating renewable energy sources into CCUS operations could significantly enhance energy efficiency.
CCUS: A Necessary, Yet Criticized Solution
Despite its promise, CCUS faces skepticism, with critics arguing it could serve as a crutch for continued fossil fuel use. Vishal acknowledges this concern but explains the inevitable reliance on fossil fuels given our existing infrastructure. Transitioning to a low-carbon future necessitates a multifaceted approach that includes CCUS to meet net-zero targets.
With current global emissions still dominated by fossil fuels, CCUS’s role could become central as industries work toward decarbonization. Vishal stated, “The intent should not be to produce more fossil fuel, but to transition responsibly while implementing carbon capture mechanisms.”
Addressing Cost Barriers
The financial implications of implementing CCUS are substantial, with projects often costing around $1 billion upfront. However, Vishal believes that ongoing research and development, coupled with supportive policies, can drive down these costs. He pointed out that direct air capture technologies, which once cost over $2,000 per ton, have seen costs drop to below $300 per ton due to advancements in the field.
Future Directions and Innovations
The Centre of Excellence in CCUS at IIT Bombay is closely involved in innovative CCUS technologies. One notable project, UrjanovaC, aims to capture CO2 from flue gas and ambient air, marking a pivotal step toward sustainable carbon management.
Vishal emphasized the importance of embedding CCUS infrastructure within new industrial plants, while also retrofitting existing facilities. These strategies are essential for making significant strides toward India’s net-zero goals.
As India positions itself at the forefront of CCUS deployment, the upcoming years will be critical in steering the nation toward sustainable industrial practices. With significant funding allocated and expert insights guiding the way, India is preparing for a new chapter in its environmental journey, striving for a balance between industrial growth and environmental sustainability.