As environmental concerns surrounding climate change continue to rise globally, the Carbon Dioxide Utilization market is gaining significant traction. Carbon Dioxide Utilization involves technologies and techniques to beneficially convert carbon dioxide gas (CO2) that would otherwise be emitted into the atmosphere into various useful products. Some key uses of carbon dioxide include carbonated beverages, fire extinguishers, food preservation and production, and urea production. CO2 is also widely used in enhanced oil recovery processes to extract more oil from existing fields.
The Global Carbon Dioxide Utilization Market is estimated to be valued at US$ 12.5 Bn in 2024 and is expected to exhibit a CAGR of 13% over the forecast period 2024 to 2031.
Key Takeaways
Key players operating in the Carbon Dioxide Utilization market include Fluor Corporation, Schlumberger Limited, Aker Solutions, Honeywell International Inc., Equinor ASA, TotalEnergies SE, Hitachi, Ltd, ExxonMobil Corporation, Linde plc, Royal Dutch Shell Plc, Mitsubishi Heavy Industries, Ltd, JGC Holdings Corporation, General Electric, Halliburton, SABIC. The major players are investing heavily in research and development of advanced carbon capture technologies to enhance utilization of CO2 in a cost-effective manner.
Growing environmental concerns as well as stringent government regulations surrounding carbon emissions are expected to drive demand for carbon dioxide utilization solutions over the forecast period. Several governments worldwide offer subsidies, tax deductions and other financial incentives to promote adoption of carbon capture, utilization and storage technologies.
The increasing focus on reducing carbon footprint is also prompting companies to adopt carbon dioxide utilization methods across major industry verticals. Furthermore, greater availability of investment capital for low carbon technologies will aid the global expansion of the Carbon Dioxide Utilization Market Demand in the coming years.
Market Drivers
One of the key drivers for the carbon dioxide utilization market is growing focus on enhanced oil recovery. CO2 injection techniques are widely used to extract additional oil from mature oil fields. As global energy demand rises, EOR applications of carbon dioxide is expected to grow substantially over the forecast period. Availability of economical carbon capture and storage technologies will further support the adoption of carbon dioxide utilization especially in oil & gas industry.
Geopolitical Impact on Carbon Dioxide Utilization Market Growth
The current geopolitical situations around the world are impacting the growth of the carbon dioxide utilization market. The ongoing Russia-Ukraine conflict and economic sanctions on Russia by western nations have disrupted the global supply chains and export/import of critical raw materials and technologies required for carbon capture, utilization, and storage projects. Both Russia and Ukraine are major exporters of metals like nickel and palladium that are important inputs in catalysts used in CCUS technologies. Restrictions on trade with Russia will negatively impact the availability of such raw materials and inflate their prices.
Geopolitical tensions between China and the US are also having ramifications. Disputes over Taiwan and the South China sea have increased economic uncertainties. Furthermore, the escalating trade war between the two largest economies is limiting technology transfers and foreign investments crucial for CCUS demonstration and deployment projects. Protectionist policies and national security reviews of foreign investments in strategic industries like carbon management can stall collaborative research efforts between companies from different countries. To overcome such geopolitical challenges, companies must diversify their supply chains, foster new international partnerships, and look for alternative sourcing options. Governments need to support strategic research alliances and promote an open global innovation ecosystem to advance CCUS technologies.
Regional Concentration of Carbon Dioxide Utilization Market Value
The carbon dioxide utilization market in terms of value is highly concentrated in North America and Europe. Countries like the US, Canada, Norway, the UK, Germany, and the Netherlands account for over 70% of the total market revenues as of 2024. This is because these regions have established carbon capture infrastructure and early commercial projects in end-use industries such as enhanced oil recovery, non-energy products, construction materials, and synthetic fuels. Stricter climate policies and carbon pricing mechanisms in Europe provide incentives for low carbon technologies. Meanwhile, the abundant availability of hydrocarbon resources and expanding CO2-EOR activities have boosted market growth in North America. Asia Pacific is emerging as a promising market with China, Japan, and South Korea significantly increasing investments in carbon management solutions.
Fastest Growing Region in the Carbon Dioxide Utilization Market
The Asia Pacific region is poised to be the fastest growing market for carbon dioxide utilization during the forecast period owing to robust economic development, rising energy demand, and supportive government policies and initiatives towards carbon mitigation. China has the largest number of CCUS demonstration projects under construction. It is encouraging the use of captured carbon for industrial and agricultural applications to meet emissions targets. Countries like India are also actively exploring CO2 utilization to replace fossil fuels. Additionally, the commercial prospect of utilizing flue gases from coal-fired power plants and emission-intensive industries provides significant opportunities. An increasing number of collaborative projects between Asian and western companies will help drive the adoption of cutting-edge CCUS technologies, accelerating the market expansion.
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