Global Availability of Biogenic Carbon Dioxide and Implications for Maritime Decarbonization

Sustainable decarbonization of the shipping industry will rely on replacing fossil fuels with low- or zero-carbon alternative fuels. Among these alternative fuels, carbon-containing e-fuels (e-methanol, e-methane, and e-diesel) are some of the front-running options. Since combusting these e-fuels releases carbon dioxide (CO₂), utilizing such fuel pathways in a sustainable manner requires producing them from CO₂ feedstocks that can be accounted as carbon removals. Biogenic CO₂ provides one of the most straightforward and least costly such feedstocks. Therefore, the industry needs to understand how much biogenic CO₂ is available globally, as well as where and at what cost. In addition, we need to understand the opportunities and barriers for shipping to access this feedstock.

To address these knowledge gaps, the Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping (MMMCZCS) has undertaken an analysis of the global availability of biogenic CO₂ and its implications for maritime decarbonization. This publication presents the results of geospatial and economic analysis using a global dataset of point-source emissions of biogenic CO₂, assembled by the MMMCZCS’s knowledge partner Rystad Energy. Our quantitative results are supported by qualitative insights drawn from a series of interviews with industry experts engaged in project development.

We estimate that the global supply of biogenic CO₂ suitable for e-fuel production lies in the range of 320-370 million tonnes per year. This volume is located mostly in Europe and the Americas and is found across 360 geographically clustered sites – each of which could theoretically correspond to an e-fuel plant capable of producing the equivalent of 1,000 metric tonnes per day of e-methanol. Most of the supply of lower-cost biogenic CO₂ comes from the pulp and paper industry.

While many point sources in our dataset could potentially cease operation before they become economical to invest in for e-fuel production, even 20% of our estimated total biogenic CO₂ supply would enable the production of around 1 EJ equivalent of e-fuel per year. This is enough energy to decarbonize 8% of the current global fleet and is ample to meet near-term maritime decarbonization targets, such as those set by the International Maritime Organization (IMO) and the FuelEU Maritime regulation.

On the other hand, our estimated biogenic CO₂ supply will not be plentiful enough to enable full decarbonization of the maritime sector. Even if the entire supply is economically accessible, it could only generate around 5.4 EJ equivalent of methanol per year. As the shipping industry currently consumes about 12.6 EJ of energy per year, the entire global supply of biogenic CO₂ is only enough to decarbonize 43% of the global fleet. Therefore, our analysis confirms that activating other fuel pathways in parallel will be essential for shipping’s full decarbonization.

Our interviews with industry experts highlighted competition with carbon capture and storage (CCS) as a major barrier to accessing biogenic CO₂ for e-fuel production. Storage is perceived as a less-complicated option and is associated with better financial and regulatory incentives than CO₂ utilization. Therefore, e-fuel producers seeking to secure biogenic CO₂ supply may be well served by identifying contexts where carbon storage is less prevalent or attractive. Regulatory incentives to balance the incentives for storage, and/or market mechanisms such as book and claim systems for CO₂, could also support better e-fuel availability.

Another challenge identified in interviews is the comparative lack of appetite among a segment of pulp mill owners, who emit large volumes of biogenic CO₂, to engage with offtake for e-fuel production. This may be partly driven by the attractiveness of CCS, as previously mentioned. Other factors include lack of awareness of fuel markets by some emitters, a lack of regulatory incentives, and the risks associated with contractual obligations and investment in carbon capture technology. Regulators and potential offtakers will need to be aware of these barriers and lend support to new business frameworks or other measures that can offset the risks to the CO₂ supplier.

Looking to the future, the aviation industry is likely to be a competitor for biogenic CO₂ and/or e-fuels in the medium term. However, technologies for some maritime-relevant e-fuels (e-methane, e-methanol) are more mature in comparison to jet fuels, for now and in the near future. In the longer term, industry stakeholders expect the petrochemicals sector to emerge as a major competitor for renewable carbon.

Overall, we expect carbon-containing e-fuels to play a meaningful role in the decarbonization of the shipping industry. However, while the global availability of biogenic CO₂ is sufficient to meet near-term regulatory targets, this feedstock can be challenging to access and has a time-limited availability. Therefore, we urge investors and developers to secure the supply of biogenic CO₂ to support maritime decarbonization while the opportunity to do so exists.

Biogenic CO₂ generally refers to any CO₂ originating from biomass or bio-based products. In the context of sustainable decarbonization using e-fuels, in this study we more specifically assume that biogenic CO₂ must be the waste product of an industry whose main product results from transforming biomass to CO₂. The scope of this study includes industries such as biomass power (including thermal power, electricity, or both), bio-ethanol, pulp mills, waste to energy (fractionally biogenic), and biogas (albeit small). We did not include future potential CO₂ sources, such as possible emissions from alternative biofuel production.

Beyond introducing a sustainability requirement, our definition of biogenic CO₂ also helps to distinguish between e-fuels’ and biofuels’ separate constraints on carbon feedstocks. Whereas biofuel pathways start with biomass as the feedstock, e-fuel pathways use CO₂ that exists because another industry uses biomass with the intention of making another product. The CO₂ produced from biomass during these processes is most often a waste product. Such CO₂ is predominantly released at a single location or ‘point source’, such as a chimney. Point-source CO₂, which is tied to a given industry, is a more convenient source of CO₂ than capture from the atmosphere.

While biogenic CO₂ is an important feedstock, its availability is limited to the few industries that use biomass in production. This dependency on the existence of such an industry limits the geographies for sourcing biogenic CO₂. For example, biogas is produced predominantly in Europe and North America, though growing quickly in certain other regions.¹

Despite carbon’s convenience as a carrier of hydrogen energy, there are limited CO₂ feedstock options that can be accounted as net carbon removals (and without imposing a CO₂ emissions burden on an industry product).² This carbon removal is required in order to avoid net-positive emissions, because combusting a carbon-containing fuel, such as methane or methanol, releases CO₂ again. In this way, carbon-containing fuels may contrast with other carbon-containing products such as plastics in certain applications, which may hold the carbon captive for a longer time.

Biogenic CO₂ represents a relatively low-cost option for sourcing CO₂ with zero greenhouse gas (GHG) intensity. Direct air capture (DAC) and direct ocean capture (DOC) are inherently more expensive than point-source capture, as the concentration of CO₂ is so much lower in the air or ocean than at a point source. Another option for sourcing CO₂ feedstock could be carbon removals that are required to offset the net emissions burden of products associated with fossil or industrial waste CO₂. However, this option is also expensive and sometimes paradoxical if CCS of the same CO₂ is possible.

Therefore, future suppliers and potential offtakers of biogenic CO₂ can benefit from better understanding the global availability of this resource. However, there have been few studies to date addressing this topic,^3,4 and even many biogenic CO₂ emitters are not yet aware of their role. Increasing understanding of biogenic CO₂ availability can both facilitate the provision of e-fuels for the maritime industry and shed light on how much decarbonization can be achieved via this fuel pathway.