China to lead CCUS investments by 2050

China, North America, ASEAN and India account for 70% of the investments.

Annual investment in carbon capture, utilisation and storage (CCUS) projects could reach a peak of nearly $175b by 2035, with China leading the commitments by 2050 at 26%.

In a report, McKinsey said investments in CCUS projects could exceed investments in gas projects by as early as 2026.

In terms of concentration, North America is behind China with a 20% share in the total investment, ASEAN at 15% and India at 11%. These four markets will comprise over 70% of the investments.

“The majority of these investments (will be) in hard-to-abate sectors (such as cement and iron and steel), as well as (potentially) in the power sector,” the report read.

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Despite this, McKinsey said that there is a gap between the needed investments to attain the net-zero targets and the announced investments.

The world would need around $120b in annual average investments in CCUS to meet the net-zero targets, with only 25% of the needed funding for CCUS by 2030 has been committed as of 2023.

“To bridge the investment gap and drive the widespread adoption of CCUS in the future, collaboration between governments, industries, and the financial sector could be essential for establishing a robust and enduring financial landscape,” the report read.