The race to develop new ways to convert heat-trapping
carbon dioxide gas into commercial products--ranging from baking soda and
cement substitutes to green fuels--is stepping up as companies and researchers
try to benefit from looming new regulations on emissions.
CO2, one of the more prevalent greenhouse gases blamed for global warming, has
long been used to carbonate beverages, produce dry ice and as a refrigerant for
the food industry. More recently, energy companies have injected large amounts
of CO2 into the earth to recover oil and gas from aging fields.
New uses for CO2 are flourishing as the federal government is preparing to
tighten its grip on large greenhouse-gas emitters such as power plants and
crude-oil refiners. These new regulations are expected to spur investments in
innovative technologies that allow emitters not only to offset the costs of
capturing emissions but also to turn a profit by making new products.
In December, the U.S. Department of Energy awarded $17.4 million to 12 projects
on CO2 use. Among the various concepts being studied, projects are looking at
the use of emissions from power plants or industrial applications to grow
biomass from algae, as well as conversion of CO2 to fuels and chemicals.
"What is happening here is that people are trying to get ahead of the
curve so they will be able to profit out of it," said Dean Watson,
operating manager for CO2 projects at Poet LLC, a large independent ethanol
producer that has also been selling CO2 for traditional uses in beverage
carbonation, food processing, water treatment and agriculture.
Supporters of new carbon-capture technologies also believe that the rebound in
oil prices--crude-oil futures rose above $85 a barrel Thursday--will make some
of the new applications more viable economically. New ways to capture and use
CO2 could also be key for areas in the Southeast coast of the
U.S.
where other, more-traditional technologies such as carbon sequestration aren't
possible due to geological limitations.
These initiatives, however, face substantial challenges as most of them remain
at the laboratory stage and have to demonstrate they can become scalable and
profitable. Additionally, some of the more-popular projects, such as the ones
that try to use C02 to produce gasoline, still have to prove that the amount of
energy used to make the product isn't greater than the energy the fuels
provide.
Finding new ways to use CO2 is positive, "but when new applications are
compared to how much CO2 is really produced and how much needs to be removed
from the atmosphere, it's a small amount," said John Litynski, director
for the DOE's national energy technology laboratory CO2 sequestration division.
Reducing emissions is a daunting task. The
U.S.
is expected to emit about 7,550 million tons of CO2 by 2030, an increase over
2005 levels of more than 14%, according to the DOE.
But supporters of new CO2 technologies believe challenges will be overcome over
time and some of them are already luring investors.
Silicon Valley start-up Calera Corp., one of winners of a DOE grant with a
project that seeks to covert CO2 into building materials including cement
substitutes, announced in March that one of the world's largest coal companies,
Peabody Energy Corp. (BTU), invested $15 million in the company.
Among the new concepts, the one that perhaps has gained the mostfollowers is
the idea to convert CO2 into fuels, as it is relatively simple to turn the CO2
produced when fossil fuels are burned back into the original fuel compound.
"We take carbon dioxide from industrial sources such as refiners and then
we feed it to algae and then convert it into oil that can displace petroleum
oil," says Kevin Berner, chief executive of Phycal LLC, a company that is
planning to build an algal oil plant in
Hawaii
nearby a Tesoro Corp. (TSO) refinery. Phycal received a $3 million grant from
the DOE.
The price per gallon of fuel made out of CO2 is still significantly higher than
gasoline made from crude oil.
Byron Elton, CEO of Carbon Sciences Inc. (CABN), a start up that is pursuing a
process to convert C02 to methanol for later conversion into hydrocarbons or
petrochemicals, said that, despite the challenge, turning CO2 into fuels is the
only carbon-capture concept than can have a large-scale impact on reducing CO2
and also be viable economically in the long term. He noted that a vast market
for gasoline already exists and the fuel can be distributed through the
existing pipeline infrastructure.