US investment in carbon removal needs to increase exponentially, finds report

Senior Science and Economics Correspondent
Source: Rhodium Group's Taking Stock 2023 • Values represent Rhodium's mid-emissions scenario. Nature-based CO2 removal includes improved forest management, afforestation/reforestation, soil carbon sequestration and more.

To reach net zero by midcentury, the United States will need to be able to remove a gigaton of carbon dioxide from the atmosphere per year by 2050, according to a new report out Wednesday from the independent market research firm, Rhodium Group.

A gigaton (one billion metric tons) is about 20% of the 5.5 gigatons of emissions the U.S. emitted in 2023, according to the group.

Currently, the U.S. is removing just a few megatons (one million metric tons) of CO2 each year.

Carbon dioxide removal, or CDR, is an umbrella term for a range of processes and technologies that take carbon dioxide emissions directly out of the atmosphere. Within CDR, there are two broad buckets: natural CDR and engineered CDR. Natural CDR refers to efforts that expand or accelerate naturally occurring processes, like changing forestry practices. Engineered CDR refers to ways of removing carbon dioxide with man-made technologies, like direct air capture (DAC).

Read this Cipher explainer to learn more about natural and engineered CDR.

It costs anywhere from less than $100 per ton to more than $1,000 per ton of CO2 removed from the atmosphere, according to the Rhodium Group, depending on the methodology used.

The U.S. has invested in federal policies to support CDR development, like the regional DAC hubs program, an expanded tax credit in the 2022 Inflation Reduction Act and funding for natural CDR through the U.S. Agriculture Department. Scaling up the country’s CDR capabilities to the level needed will require additional policy efforts that provide the industry with billions of dollars in annual support between now and 2050, Rhodium says.

The IRA gives policy support to natural CDR for activities starting in the five years since the law passed, compared to the 10 years given to DAC.

“This is why there’s a surge of natural CDR early and then it starts to decline,” John Larsen, a partner at Rhodium, told Cipher via a press liaison. “Natural CDR doesn’t have an initial scale up constraint” and can be deployed more immediately, he said.

Meanwhile, “DAC barely exists today, and so an industry needs to scale up to support deployment. That’s why it takes a few years for DAC CDR to show up on the chart,” Larsen told Cipher.