The cost of direct air capture (DAC) projects needs to fall by 75 percent if nascent carbon removals technologies are to become a commercially viable climate solution, according to new research.
A study published by Boston Consulting Group (BCG) highlights the dramatic cost reductions required to enable the fledgling carbon removals sector to emerge as a "climate solution supported by market demand."
The cost of carbon removal using DAC currently stands at between $600 and $1,000 per metric ton, according to the new analysis. But BCG contends costs would have to fall to below $200 per metric ton, and ideally closer to the current market rate of around $100 per metric ton, by midcentury if it is to scale to the levels required if the sector is to play a meaningful role in meeting global climate goals.
The cost reductions required for DAC over the next 27 years roughly equate to the reduction in solar PV costs seen over the last 40 years, the researchers note.
BCG characterized the rapid transition towards low-cost DAC projects as difficult, but not impossible. "We believe that reducing DAC costs to $150 per ton of CO2 or below is achievable, but getting there is going to be a stretch," the report notes. "Reaching this target depends on early and dramatic progress in several areas and will require governments and other stakeholders including carbon accounting and net zero target-setting organizations to play their part."
Insiders maintain the development of the sector is being stymied by a lack of policy support from governments, as well as limited public funding.
Advocates of carbon removal technologies maintain that there is huge potential for steep cost reductions across the nascent sector, given the potential for economies of scale, continued technology improvements, and the fact a wide range of different projects are being trialed.
But BCG's report warned t
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