Policies for Scaling Up Carbon Dioxide Removal in the United States Issue Brief 24-01 by MIchael Toman, James Boyd, Alan Krupnick, and Emily Joiner — April 2024 Carbon dioxide removal (CDR) involves the application of chemical or biological processes by which carbon dioxide (CO2) can be removed from the atmosphere and stored in different reservoirs. Those reservoirs include soils, oceans, underground (geologic) storage sites, long-lived wood products, and living biomass like forests. The 2015 Paris Agreement under the auspices of the 1992 United Nations Framework Convention on Climate Change established the aim of limiting the global average temperature increase from global emissions of greenhouse gases (GHGs) to less than 2.0°C, and as close to 1.5°C as possible, to limit dangerous impacts from climate change. Achieving that aim requires a concerted international effort to reduce GHGs to zero by midcentury. Many analysts have concluded that achieving the Paris temperature limits is infeasible without major increases in CDR, even with aggressive measures to limit GHGs (which have not yet been achieved).1 Furthermore, net negative emissions removal (above and beyond what is achieved by a net-zero economy) will be necessary to reduce the stock of atmospheric CO2 if, as is currently feared, emissions “overshoot” the trajectory for achieving the temperature limits. Smith et al. (2023) describe the lack of national goals for CDR around the world, and the lack of adequate policies to engender rapid and significant advances in CDR capability followed by large-scale installation of CDR. In what follows we summarize what we believe are needed innovations in US CDR policy to achieve these goals.2 A few basic principles underlie the policy suggestions. Public sector support for CDR research, development, and demonstration is needed. However, as technologies mature, public sector support should be scaled back in favor of policies relying on private sector incentives to finance the major buildup in CDR capacity needed. Policy should be based on technology performance and cost of CO2 removal across a portfolio of approaches. However, negative side effects also must be identified and addressed in a timely way. Finally, CDR policy should be designed to take advantage of benefits from coordination with GHG mitigation measures. 1. Carbon Dioxide Removal Technologies and Costs ARI (afforestation, reforestation, and improved forest management) consists of actions taken to expand the forest carbon sink, including carbon stored in soils. It also includes carbon stored in long-lived wood-based products.3 ARI cost estimates range from $10–$100/ 1 Smith et al. (2023); Coalition for Negative Emissions (2021); Environmental Defense Fund (2021); Committee on Developing a Research Agenda for Carbon Dioxide Removal and Reliable Sequestration et al. (2019); IPCC (2018). These sources also provide background on the temperature goals; in addition, see IPCC (2018). 2 These findings are based on research contained in a recent RFF report (Boyd et al. 2024). 3 Additional carbon could also be stored in agricultural soils, but both the amount of feasible storage and its permanence remain unclear (Toman et al. 2022). tCO2 stored.4 Within this range, there is no central cost estimate: forest-based CDR costs vary greatly because of differences in forest features and forest sequestration strategies (e.g., afforestation vs. changed harvest practices). The opportunity costs of land-use conversion to forests (e.g., its value in alternative uses, such as agriculture or range) and changes in forest management (e.g., the commercial opportunity costs of delayed harvests) also vary significantly. BEC (bioenergy with carbon capture) is the production and use of plant biomass as a feedstock for supplying energy, through either combustion or fermentation and refining into fuel. BECCS (bioenergy with carbon capture and storage) adds transportation (by pipeline or other means) and long-term underground storage of the CO2. Carbon capture and storage (CCS) is used to remove CO2 from flue gas using various chemical reactions. Fuss et al. (2018) estimate that BEC via combustion costs $80–$200/tCO2, without specifying feedstock. Sanchez et al. (2018) estimate that capture with bioethanol fermentation costs $30/tCO2, though there are also costs associated with producing the bioethanol from biomass feedstocks. BiCRS (biomass carbon removal and storage) involves the cap