2025 feels different for carbon capture, utilization and storage (CCUS).
After a decade of pilot plants and stop-start financing, the sector has reached a visible inflection point: the number of commercial CCUS facilities and total capture capacity grew sharply in 2025, driven by new projects coming online, bigger investment rounds and an expanding policy toolkit in some countries — even as other governments retrenched or cut grants.
Global trackers now show dozens more operating facilities and tens of millions of tons per year of capture capacity that simply didn’t exist three years ago.
“After thirty years of development, 2025 marked a growing consensus that CCS is a viable and critically important climate solution. 2025 was a landmark year for CCS where ideas were turned into action in policymaking, commercial deals, and project starts,” said A.J. Simon, Director of Industrial Decarbonization at Carbon Direct.
Jarad Daniels, CEO of the Global CCS Institute, echoes this sentiment, saying: “CCS is delivering real, measurable results. Since 1996, more than 380 million tonnes of industrial-derived CO2 have been captured and permanently stored underground with CCS. Our 2025 Global Status of CCS report identifies 77 operating projects, 47 additional projects now in construction, and hundreds more in various stages of development around the world.”
North America: Rapid Private Investment, Jagged Public Support
North America remains home to the largest number of projects in development worldwide, with the US leading the charge, but Canada has been doubling down, reaching a current CO2 capture capacity of 4.4 million tons per annum (mtpa).
Canada has a strong concentration of both operational and planned projects in the western provinces, with pipeline and hub plans especially pronounced in Alberta and Saskatchewan.
Meanwhile, in the United States, major oil & gas and industrial firms continued to acquire storage acreage and take stakes in hubs. For example, Exxon secured large Texas state offshore leases for prospective CO2 storage, and major energy players have been involved in multi-company storage consortia and acquisitions to lock up geology for long-term sequestration.
“The 45Q tax credit for CCUS was expanded, Texas received primacy over geologic CO2 storage, [and] the first full-scale power purchase agreement for natural-gas fired electricity with CCS was announced,” A.J. Simon added to the list of this year’s milestones in carbon management.
Technology and service firms teamed up with storage-asset developers to create “hubs” — for example, partnerships between oilfield service/technology vendors and storage companies to supply compression, monitoring and well design for storage hubs across the Mountain West and Gulf Coast.
One notable example is the partnership between Baker Hughes and Frontier Infrastructure, which aims to boost the latter’s large-scale CCS and power solutions in the wake of rapidly expanding data centers and sky-high power demand.
But US federal policy became jagged in 2025: the US Department of Energy (DOE) trimmed or re-scoped grant awards and, in some instances, cancelled funding for a number of clean-energy and CCUS demonstrations – a move that delayed or reshaped certain projects. Rising costs and fiscal restraint also forced developers to re-think some proposals.
Relevant: DOE Withdraws $3.7B Carbon Capture, Decarbonization Funding
“CCS is moving forward in countries where durable government policies, market opportunities, and regulations enable capital investment. The business case for CCS remains the core challenge to broader deployment, and progress depends on advancing policies, markets, and international collaboration on climate action,” Jared Daniels said.
So while private capital and oil-and-gas balance-sheet support are driving real buildout, inconsistent public grants and higher inflationary costs created a mixed picture for projects that need government co-funding. Even so, many experts remain optimistic that 2026 will bring further expansion to the sector.
“The team of CCS experts at Carbon Direct is excited for 2026, when we expect to see multiple deals for natural gas-fired electricity with CCS to power energy-hungry data centers. Industrial capture is set to take off as well – we expect major progress on major ethanol and fertilizer capture projects, especially along the US Gulf Coast and in other areas adjacent to established CO2 transportation and storage infrastructure,” A.J. Simon told the Carbon Herald.
Europe: Coordinated Transport & Storage Networks Finally Making Progress
In 2025, the defining European story is networked CCS. Cross-border transport and shared storage capacity have been moving from concept to contracts and investment decisions all throughout the year, along with major policy shifts in the EU.
The Global CCS Institute and regional agencies report multiple European projects reaching final investment decisions (FIDs) or getting close, including Northern Lights expansion and several national cement and energy plant carbon capture projects scheduled to start operations in 2026.
European project design increasingly bundles capture at industrial sites, a shared CO2 transport system – be it through pipeline or ship – and offshore storage.
Norway’s Northern Lights transport & storage project has continued into a second phase of development with confirmed plans to expand its storage capacity to 5 million metric tons of CO2 per year and sign more commercial storage contracts with continental clients.
Just now, the project led by fossil fuel giants Equinor, Shell and TotalEnergies, issued its very first certificates verifying permanent CO2 storage at the offshore Aurora reservoir. Records show that the collected CO2 has been transported and injected into rock formations more than 2,600 meters (8,530 feet) beneath the North Sea, fully validating its custody from capture to storage.
With this certified storage in place, Northern Lights is set to emerge as a major open-access CO2 repository in Europe, giving industries a practical route to cut their emissions at scale. European plans now emphasize multi-client storage hubs beneath the North Sea.
On the industry side of things, several first-of-their-type carbon capture units for cement and waste-to-energy plants have either started commissioning or been scheduled for 2026 – a notable shift because these are notoriously hard-to-abate industrial emissions sources.
Heidelberg Materials has been at the forefront of this movement, having launched several large-scale projects in the UK, Sweden, Norway, and most recently, Bulgaria. Not all of these have been running smoothly, however, with the Swedish project losing state backing and ending up paused at the time of writing.
Relevant: Heidelberg Materials Pauses CCS Investment In Sweden After Losing State Backing
Other CCS project developers in the region have also faced restructuring and exits as projects moved from prefeasibility to capital-intensive engineering. A notable example in 2025 was the decision by lead developer Storegga to sell its stake in Scotland’s flagship carbon storage project Acorn – a move that generated concern about who will provide long-term capital in a high-capex phase.
We saw another setback with the H2 Teesside hydrogen and carbon capture project, as fossil fuel giant BP scrapped plans for it in the wake of the UK government’s decision to push forward with an AI-focused redevelopment of the region.
Despite these challenges, Europe’s strategy of shared transport and regional storage hubs is bearing fruit. A handful of cross-border contracts and FIDs in 2025 demonstrate that the pan-European hub model can work, but the sector still depends on steady public co-finance and stable long-term commercial off-take contracts.
Asia-Pacific: Emerging Hubs and National Strategies
In Asia, a mix of state-led initiatives, market pilots, and industrial drivers continues to shape CCUS deployment, with China at the forefront. China’s state-owned energy firms and national roadmaps have propelled a series of CCUS projects and industrial capture experiments.
While comprehensive data on China’s total capacity is not as widely reported in global trackers, analyst assessments suggest that Chinese deployments are outpacing many Western counterparts on cost and speed, thanks to lower reported capture costs and strong state backing.
India has published national R&D strategies focusing on CCUS in heavy industries like steel, cement and power – sectors crucial for its climate agenda – and has established its first cluster of carbon capture and utilization (CCU) testbeds within the cement sector.
Thailand is now moving forward with its inaugural large-scale carbon capture project, led by the state-owned PTTEP and supported by industry heavyweights Mitsui and Technip Energies.
Meanwhile, Gulf countries such as the UAE and Saudi Arabia have carried out numerous carbon capture studies and launched CCS pilot projects, signaling that fossil-rich economies view CCUS as both a climate tool and economic strategy.
Not all voices in Asia are optimistic, though. Climate analysts warn that if CCS plans are deployed without stringent climate checks, they could lock in additional emissions or divert attention from more impactful mitigation actions, echoing skepticism seen in Australia, where projects like Chevron’s Gorgon CCS have underperformed relative to expectations.
Asia’s CCUS landscape is driven by national strategies and industrial champions, especially in China and the Middle East, but must balance deployment with wider climate integrity and market development.
2025’s Momentum Could Bring The Scale Of 2026
2025 marks a pivotal year for CCUS not because the technology has suddenly solved climate change, but because the ecosystem is moving from demonstration toward deployment with real industrial scale. North America’s private sector drive, Europe’s coordinated networks, and Asia’s national strategies collectively reflect a maturing sector that must now focus on commercial viability, policy clarity, and large-scale infrastructure.
“Real-world progress on CCS deployment matters because carbon capture is a scalable strategy that actively bridges climate action with energy abundance. The need is urgent – despite explosive growth of renewable energy, fossil CO2 emissions continue to increase, and the demand for clean, firm power has never been greater,” A.J. Simon told us.
Relevant: Global CCS Institute Publishes 2025 CCS Technologies Compendium
“Looking ahead, the Institute is optimistic. CCS is indispensable to achieving global decarbonisation, and the building blocks for deployment are coming together across a growing number of countries,” concluded Jared Dainiels.
“Following COP30, there are now 64 countries which include carbon management in their NDCs. While recent progress has been notable, much work remains to achieve gigatonne levels of climate impact through CCS alongside other global efforts.”
For CCUS to make outsized climate contributions, policymakers and industry leaders must double down on durable policies, bankable contracts, and equitable investment models, while addressing skepticism about cost effectiveness and climate integrity.
If managed well, 2025 could be remembered as the year CCUS finally stopped being a concept and started becoming a climate solution. If not, the gap between ambition and impact may widen instead.
Read more: CDR In 2025: The Shifts And Strides That Redefined The Sector
