Carbon, capture storage report suggests financing solutions
Consultancy firm Baringa identifies a persistent structural financing gap, particularly at late‑stage development.
According to the International Energy Agency (IEA), carbon, capture and storage (CCS) could deliver up to 8% of global emissions reductions between 2022 and 2050. in turn, the Baringa report presents CCS as essential for achieving net‑zero by 2050, supporting low‑carbon power, industrial decarbonisation, and carbon removal at scale.
The report finds that the technical performance of CCS is proven with key markets such as the UK, Norway, the Netherlands, the US and Canada having commercial and policy frameworks in place to connect supply and demand.
However, more work is needed to ensure financial firms are comfortable with the market risks involved, by demonstrating proof of credible revenue models.
The team behind the report says getting projects operational will be critical in speeding up learning cycles and providing further reassurance about the technology.
The report identifies a persistent structural financing gap, particularly at the late‑stage development phase. Independent capture‑side developers struggle to secure development capital and predictable long‑term revenue streams, limiting financial close and delaying deployment. Early CCS projects have depended heavily on government support, a model that is not scalable for global decarbonisation needs.
To unlock capital at the scale required, the report proposes a three‑part integrated strategy:
- Establish a development capital fund - a dedicated, flexible financing facility, offering instruments such as equity, debt or guarantees
- Create bankable revenue streams - aggregating demand for CO₂ removal credits and low‑carbon products can generate investment‑grade, long‑term offtake contracts, increasing investor confidence and enabling financing at lower cost of capital.
- Accelerate learning and standardisation - global CCS financing lessons forum should share best practices, standardise financing structures, and reduce knowledge concentration among a small group of players to improve market transparency, expand the pool of capable investors, and accelerate deployment timelines.
