US Industry Gets to Work on CCS Efforts

Copyright © 2021 Energy Intelligence Group

US oil and gas companies have staked out carbon capture and storage (CCS) as a key plank of their decarbonization strategies. The US industry has been slow to follow its European peers, who plan to pivot to low-carbon power and away from oil. So far, US investors have been keen on CCS' potential both as a new business line and for curtailing emissions. “We see the [US energy] sector well-positioned to scale CCS, a required technology in a net-zero world, underpinned by key competitive advantages,” Morgan Stanley states. But there are risks to this approach, as European investors — often a bellwether for global climate investing trends — coalesce around a net-zero standard that includes both operational (Scopes 1 and 2) and end-use (Scope 3) emissions. US energy companies boast strong geological expertise and exposure to high CO2 storage capacity, with the US accounting for two-thirds of the global total, Morgan Stanley notes. Strong pre-existing infrastructure also helps, as does strengthening policy support under US President Joe Biden. But there’s also a risk that US investors could become more skeptical toward CCS or carbon offsetting plans, as have some European counterparts have, since they allow for continued use of fossil fuels.

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