Why In News?

Organised by the Council of Scientific & Industrial Research (CSIR), the ESTIC-2026 (Emerging Science, Technology and Innovation Conclave) highlighted Carbon Capture, Utilisation and Storage (CCUS) as a critical technological pillar to achieve Net Zero emissions by 2070.  

What Is Carbon Capture, Utilisation, And Storage (CCUS)?

Definition: CCUS is a suite of technologies designed to capture carbon dioxide (CO₂) directly from industrial process flues, fuel combustion exhausts, or ambient air, purifying and compressing the gas into a dense supercritical state for industrial reuse or permanent subsurface trapping. 

Three-Stage Technological Value Chain:

  • Capture: Uses Chemical Solvents (such as Monoethanolamine MEA for low-pressure flue gases), Physical Solvents (such as Selexol™ for high-pressure streams), Adsorption (Vacuum/Temperature Swing Adsorption), Cryogenic Separation, or Direct Air Capture (DAC).

  • Transport: Moves supercritical CO₂ via high-pressure trunk pipelines, semi-refrigerated marine vessels, or insulated road tankers.

  • Utilisation and Storage: Converts CO₂ into commercial outputs (Green Urea, Green Methanol, Olefins, Concrete Aggregates, Polymers) or injects it underground into geological sinks.

India's National Emission Profile: India emitted 2.6 gigatonnes per annum (gtpa) of CO₂ in 2019, with per capita emissions standing at 1.9 tonnes per annum—less than 40% of the global average. Industrial and power sector emissions are projected to rise from 1,621 mtpa in 2020 to 2,291 mtpa by 2030. (Source: NITI Aayog)

Free Mentorship Need Guidance for UPSC / WBCS / State PSC?
100% Free & Confidential • Quick Callback

Subsurface Storage Capacity in India: India possesses a total theoretical geological storage potential of 395–614 Gt CO₂ across 26 sedimentary basins and volcanic traps. This comprises 291 Gt in Deep Saline Aquifers, 97–315 Gt in Basaltic Formations (Deccan Traps), 3.4 Gt via Enhanced Oil Recovery (EOR), and 3.5–3.7 Gt via Enhanced Coal Bed Methane Recovery (ECBMR). (Source: NITI Aayog)

Why Is CCUS Critical For Decarbonising India's Hard-To-Abate Sectors?

Emissions Challenge: Heavy manufacturing sectors (Steel, Cement, Refineries, Chemicals, Fertilisers) and thermal power generation account for 70% of India's aggregate greenhouse gas emissions. (Source: NITI Aayog)

  • These sectors require high-temperature process heat or use fossil carbon as a chemical reductant, making deep decarbonisation via direct electrification technically unfeasible. 

Preventing Capital Asset Stranding: Over 66% of India's 210 GW coal-based power plant fleet and 144 mtpa crude steel production capacity are less than 15 years old. 

  • Retrofitting existing units with carbon capture technology prevents premature asset write-downs and avoids an estimated $6 billion per year in climate-induced economic damage by 2050. (Source: NITI Aayog)

Unlocking Sunrise Clean Energy Systems: Coupling CCUS with coal gasification enables cost-competitive Blue Hydrogen production at $2/kg (or a cash cost under ₹100/kg using blast furnace waste gases in steel plants), creating a bridging pathway to a low-carbon hydrogen economy before Green Hydrogen reaches market parity at $5–6/kg. (Source: NITI Aayog)

Ensuring Export Competitiveness: International trade mechanisms like the European Union Cross Border Adjustment Mechanism (CBAM) impose financial penalties on carbon-intensive industrial imports. 

  • Implementing CCUS reduces the carbon intensity of Indian steel and cement exports, ensuring compliance with global carbon border adjustments.

What Are The Key Features And Deployment Mechanisms Of India's CCUS Strategy?

Dedicated Budgetary Outlay: Under the Union Budget 2026–27, the Ministry of Finance allocated ₹20,000 crore over five years to finance CCUS technology development and deployment across 5 key industrial sectors: Power, Steel, Cement, Refineries, and Chemicals. 

National R&D Roadmap 2025: Formulated by the Department of Science and Technology (DST), it establishes priority funding pathways, balances commercial technology assimilation (TRL 8–9) with breakthrough research, and leverages the ₹1 Lakh Crore Research, Development & Innovation (RDI) Scheme. 

National Centres of Excellence & Field Laboratories:

  • National Centres of Excellence (CoEs): Established in 2022 at IIT Bombay and JNCASR, Bengaluru under DST to boost indigenous carbon conversion and storage methodologies.

  • India’s First Integrated CCUS Field Laboratory: Inaugurated in May 2026 at IIT Bombay, featuring a 3 TPD CO₂ pilot capture platform using non-potable water, coupled with scientific test drilling in the Deccan Traps for basaltic mineral sequestration.  

Academia-Industry Testbeds:

  • Cement Sector Testbeds: Launched in 2025, comprising 5 Public-Private Partnership (PPP) testbeds.

  • Coal Gasification Testbeds: Executed by IIT Delhi–Thermax Ltd (Pune, Maharashtra) and CSIR-IICT Hyderabad–BHEL for producing Methanol and Dimethyl Ether (DME).  

Regional Hubs & Clusters Framework: Promoted by NITI Aayog to connect co-located point-source emitters via shared, oversized pipeline networks to central storage sinks, prioritizing 3 main corridors: Gujarat Coast (refineries/chemicals), Odisha–Jharkhand Belt (steel/cement), and Northeast India (oil & gas fields).  

Key Challenges to CCUS Deployment in India

High Capital Intensity and Energy Penalties: Retrofitting carbon capture units requires massive upfront capital investments and imposes a substantial thermal and electrical energy penalty (up to 20–30% auxiliary power consumption in power plants for solvent regeneration), driving up production cash costs.

  • Example: NITI Aayog CCUS Study Report, retrofitting an 800 MW thermal power plant requires ₹3,500–4,000 crore capital expenditure with capture cash costs reaching ₹2,100–2,500 per tonne of CO₂.

Absence of Shared Transportation Infrastructure: Individual industrial emitters face prohibitive unit transport costs due to a lack of interconnected supercritical CO₂ trunk pipelines, forcing reliance on localized commercial off-taking.

  • Example: HPCL Visakh Refinery Demonstration Plant, a 72 TPD capture facility operating in isolation without regional trunk pipeline aggregation, restricting CO₂ disposal to local beverage manufacturing.

Regulatory Ambiguity Regarding Long-Term Subsurface Storage Liability: Current statutory frameworks lack explicit provisions for transferring long-term post-closure site liability from private project developers to state authorities, discouraging private investments in geological sequestration.

Carbon Pricing and Revenue Mechanisms: India lacks a functioning compliance carbon market that guarantees stable revenue or tax equity returns for captured carbon, leaving project cash flows vulnerable to price volatility.

What Measures Can Accelerate CCUS Scaling In India?

Institutional Financing via a Specialized Entity: Create the Carbon Capture Finance Corporation (CCFC) to distribute performance-linked Accelerated Depreciation (AD) tax credits (for capital expenditure) and Generation Based Incentives (GBI) cash credits (for operating costs), financed by re-introducing the Clean Energy Cess on coal.

Phased Deployment of Mega Regional Clusters: Establish oversized multi-user CO₂ transport and storage hubs operated as regulated monopolies to capture economies of scale across dense industrial belts.

  • Example: Alberta Carbon Dioxide Trunk Line (ACTL) Model, a 240 km multi-user supercritical pipeline network aggregating CO₂ from fertilizer and refining plants, reducing transport and capture costs.

Production Linked Incentives (PLI) & Mandatory Green Procurement: Extend the Production Linked Incentive (PLI) scheme to low-carbon industrial commodities (Green Steel, Green Cement, Blue Hydrogen) and enforce green procurement quotas in public infrastructure works.

  • Example: Union Budget 2026–27 CCUS Scheme, leveraging the ₹20,000 crore outlay alongside public procurement preferences in government schemes like Pradhan Mantri Awas Yojana (PMAY) to guarantee market off-take for green building materials.

Statutory Baselines and Life Cycle Assessment (LCA) Frameworks: Authorise the Bureau of Energy Efficiency (BEE) to mandate emissions baselining and implement rigorous Monitoring, Verification and Accounting (MVA) protocols for geological storage.

Conclusion

Adopting an integrated CCUS policy framework is essential to balance India's fossil fuel reliance with its Net Zero by 2070 goal. Regional hubs, statutory financing, and monitoring standards will decarbonise hard-to-abate sectors while safeguarding material and energy security.

Source: PIB

PRACTICE QUESTION

Q. With reference to Carbon Capture, Utilisation and Storage (CCUS) in India, consider the following statements:

  1. According to NITI Aayog estimates, deep saline aquifers constitute the largest proportion of India's theoretical geological carbon storage potential.

  2. The Union Budget 2026–27 announced a dedicated financial outlay of ₹20,000 crore over five years for CCUS deployment across key hard-to-abate sectors.

  3. Chemical solvent-based capture using primary amines is most suitable for high-pressure gas streams with high carbon dioxide concentration.

Which of the statements given above are correct? (a) 1 and 2 only

(b) 2 and 3 only

(c) 1 and 3 only

(d) 1, 2, and 3

Answer: (a)

Explanation:

Statement 1 is correct: Deep saline aquifers offer the highest theoretical storage potential in India at 291 Gt, out of the total estimated 395–614 Gt.

Statement 2 is correct: The Union Budget 2026–27 allocated ₹20,000 crore over 5 years for CCUS across 5 sectors: Power, Steel, Cement, Refineries, and Chemicals.

Statement 3 is incorrect: Chemical solvents (e.g., primary amines like MEA) are preferred for gas streams with low concentration and low partial pressure of CO₂ (such as flue gas). Physical solvents or adsorption are used for high-pressure, high-concentration streams.