Why in News ?
- Union Budget 2026–27 earmarks ₹20,000 crore for a national Carbon Capture, Utilisation and Storage (CCUS) scheme, signalling India’s intent to deploy deep-decarbonisation tools for hard-to-abate industrial sectors.
Relevance
GS-3 – Environment / Economy / Science & Tech
- Climate change mitigation
- Clean energy transition
- Environmental technologies
- Carbon markets & green economy
GS-2 – International Relations / Global Agreements
- Paris Agreement & CBDR
- Global climate governance
CCUS – Basics
What is CCUS ?
- CCUS involves capturing CO₂ at source, compressing and transporting it for utilisation in products or permanent geological storage, preventing atmospheric release from fossil-fuel-intensive industrial activities.
How it Works ?
- Process includes post-combustion or pre-combustion capture, pipeline or ship-based CO₂ transport, and injection into saline aquifers, depleted oil fields, or mineralisation systems for long-term containment.
Budget Scheme – Key Features
Financial Commitment
- ₹20,000 crore allocation provides catalytic funding for pilot projects, viability-gap support, and infrastructure creation, recognising CCUS as capital-intensive but essential for achieving net-zero by 2070 commitments.
Sectoral Focus
- Priority given to steel, cement, fertilisers, refineries, and thermal power, where process emissions are unavoidable and electrification alternatives remain technologically or economically constrained in the medium term.
Design Approach
- Emphasis on retrofit integration in existing facilities rather than greenfield-only plants, reducing transition costs, preserving assets, and enabling faster emissions reduction within India’s current industrial base.
Technology Development
- Scheme promotes indigenous R&D, demonstration plants, and shared transport-storage networks, aiming to build domestic technological capability and reduce long-term dependence on imported climate technologies.
Rationale Behind CCUS Push
Climate Commitments
- India’s Panchamrit targets include emissions-intensity reduction and net-zero by 2070; CCUS offers pathway for deep decarbonisation where renewables alone cannot fully eliminate industrial emissions.
Energy Transition Reality
- Coal still contributes major electricity share; CCUS enables cleaner fossil fuel use during transition, balancing developmental needs with climate responsibility under Common But Differentiated Responsibilities (CBDR) principle.
Global Policy Trends
- Countries like USA, UK, Norway incentivise CCUS through tax credits and carbon markets; India’s move aligns with emerging carbon border adjustment pressures and global green competitiveness norms.
Constitutional / Legal Dimension
- Supports Article 48A environmental protection duty and Article 21 right to life via pollution reduction, while future legal frameworks must regulate liability, monitoring, and long-term storage risks.
Governance / Administrative Dimension
- Requires coordination among MoEFCC, DST, Ministry of Power, and state pollution boards, plus robust MRV systems (Monitoring, Reporting, Verification) to ensure captured carbon is permanently contained.
Economic Dimension
- CCUS can protect energy-intensive export sectors from carbon tariffs, preserve jobs, and create new value chains in carbon-based products, enhanced oil recovery, and green construction materials.
Environmental Dimension
- Potential to reduce large-volume industrial emissions, yet lifecycle assessments must ensure net-negative outcomes, avoiding energy-intensive capture processes that indirectly increase fossil fuel consumption.
Technology / Security Dimension
- CO₂ pipelines and storage sites require leak-proof infrastructure, seismic assessments, and cybersecurity for digital monitoring systems, as accidental releases could undermine climate and safety objectives.
Data & Evidence
- IEA estimates global net-zero pathways require capturing 7–8 gigatonnes CO₂ annually by 2050, while current deployment remains below 10% of required scale, showing large expansion necessity.
- India’s steel and cement sectors together contribute significant industrial emissions share, making them prime candidates where CCUS yields high marginal abatement impact compared to incremental efficiency improvements.
Challenges / Gaps
- High capture costs (often US$40–100 per tonne globally) and uncertain carbon pricing reduce private-sector enthusiasm without predictable policy incentives or carbon-market integration.
- Long-term storage liability, leakage risks, and public acceptance concerns create regulatory and social hurdles, requiring transparent risk communication and strict environmental safeguards.
- CCUS may risk moral hazard by prolonging fossil-fuel dependence if not paired with renewable expansion and efficiency improvements.
Way Forward
- Develop carbon markets and pricing signals to make CCUS financially viable, integrating it with India’s emerging Carbon Credit Trading Scheme framework.
- Create CCUS clusters near industrial hubs and sedimentary basins, lowering transport costs and enabling shared infrastructure for multiple emitters.
- Encourage international technology partnerships and climate finance to de-risk early investments and accelerate learning curves.
- Ensure CCUS complements, not substitutes, renewable expansion and energy efficiency, maintaining balanced decarbonisation strategy.
Data & Facts
- CCUS currently captures ~45–50 million tonnes CO₂/year globally, while net-zero pathways need gigatonne-scale capture.
- IEA: CCUS required for ~15% of cumulative emissions reduction by 2070 globally.
- Steel and cement together contribute ~15–18% of global CO₂ emissions.
- Norway’s Longship project is a flagship national CCUS model.
- IPCC recognises CCUS as essential for hard-to-abate sectors.
- India is the 3rd largest CO₂ emitter, but per-capita emissions remain far below developed nations.
