Deep dive: CO2 utilization pathways (mineralization, fuels, chemicals) — the fastest-moving subsegments to watch

CarbonCure Technologies has injected mineralized CO2 into more than 850 million cubic yards of ready-mix concrete since 2020, permanently sequestering over 400,000 tonnes of CO2 while simultaneously improving compressive strength by 5 to 10%. That single application represents just one of at least 14 commercially viable CO2 utilization pathways now attracting investment across mineralization, synthetic fuels, and chemical feedstock conversion. The CO2 utilization market reached an estimated $7.8 billion in 2025 and is projected to exceed $28 billion by 2032, driven by tightening carbon pricing, corporate net-zero procurement mandates, and breakthrough catalytic and electrochemical technologies that are rapidly closing the cost gap with fossil-derived incumbents (Lux Research, 2025).

Why It Matters

Carbon capture without utilization faces a fundamental economic barrier: geological storage generates no revenue and imposes ongoing monitoring costs of $8 to $15 per tonne of CO2 stored annually. CO2 utilization flips this equation by converting captured carbon into products that command market prices, creating revenue streams that offset or exceed capture costs. For procurement professionals, this shift is transformative because it means CO2-derived products are entering supply chains across construction materials, aviation fuels, polymers, and commodity chemicals at prices increasingly competitive with conventional alternatives.

The US Inflation Reduction Act's 45Q tax credit, expanded to $85 per tonne for direct air capture and $60 per tonne for point-source capture with utilization, has created the most favorable economics for CCU deployment globally. Combined with the EU's Carbon Border Adjustment Mechanism (CBAM), which began its transitional phase in 2023 and enters full implementation in 2026, procurement teams sourcing cement, steel, chemicals, and fuels now face regulatory and financial incentives to evaluate CO2-derived alternatives. The question is no longer whether CCU products will enter mainstream procurement but which subsegments are moving fastest and where the supply will be sufficient to meet demand.

Key Concepts

CO2 utilization pathways fall into three broad categories, each with distinct technical maturity, market dynamics, and procurement implications. Carbon mineralization converts CO2 into solid carbonates, permanently locking carbon into building materials. Synthetic fuels (e-fuels) use CO2 and green hydrogen to produce hydrocarbons that are chemically identical to fossil fuels, targeting aviation, maritime, and heavy transport. CO2-to-chemicals pathways convert captured carbon into methanol, ethanol, formic acid, polymers, and other industrial chemicals, displacing fossil-derived feedstocks.

The critical differentiator between pathways is permanence. Mineralization sequesters CO2 for geological timescales (thousands to millions of years). Fuels release CO2 upon combustion, making them carbon-neutral at best (net-zero lifecycle emissions) rather than carbon-negative. Chemical intermediates vary: polymers can lock carbon for decades, while solvents and short-lived chemicals release CO2 within months. Procurement teams evaluating CO2-derived products must understand these distinctions because they directly affect Scope 3 accounting treatment under the GHG Protocol's 2025 guidance on CCU product emissions allocation.

What's Working

Carbon Mineralization in Concrete and Aggregates

Mineralization is the most commercially mature CCU subsegment, with multiple companies operating at commercial scale. CarbonCure's injection technology is deployed at more than 700 concrete plants across North America, requiring no changes to existing mix designs or production equipment. The technology adds $1 to $3 per cubic yard to concrete costs while reducing cement content by 3 to 5%, often resulting in net-zero or slightly negative cost impact for producers. Solidia Technologies has commercialized a CO2-cured concrete process that replaces steam curing with CO2 curing, reducing the carbon footprint of precast concrete by up to 70% while cutting curing time from 28 days to less than 24 hours.

Blue Planet Systems takes a different approach, producing synthetic limestone aggregates from CO2-mineralized calcium carbonate. The company's first commercial facility in Pittsburg, California, began production in 2025 with capacity to mineralize 25,000 tonnes of CO2 per year into construction-grade aggregate. The aggregates meet ASTM C33 specifications and have been approved for use by the California Department of Transportation (Caltrans) in road construction and by several major concrete producers for ready-mix applications.

For procurement teams, mineralized concrete products offer the clearest value proposition: proven performance, existing standards compliance, competitive pricing, and permanent carbon sequestration that generates verifiable Scope 3 reductions. The US General Services Administration now includes CO2-mineralized concrete as a preferred material in federal construction procurement guidelines, signaling mainstream acceptance (GSA, 2025).

E-Fuels for Aviation

Synthetic aviation fuel (sustainable aviation fuel produced via the power-to-liquid pathway) is the fastest-growing CCU subsegment by investment volume. Infinium, HIF Global, Twelve, and Prometheus Fuels collectively raised more than $3.2 billion in 2024 and 2025 to build e-fuel production facilities targeting the aviation sector.

The economics are driven by regulatory mandates. The EU's ReFuelEU Aviation regulation requires airlines to blend 2% sustainable aviation fuel (SAF) by 2025, rising to 6% by 2030 and 70% by 2050, with a sub-mandate specifically for e-fuels starting at 1.2% in 2030. In the US, the SAF Grand Challenge targets 3 billion gallons of annual SAF production by 2030, supported by the 45Z Clean Fuel Production Credit of up to $1.75 per gallon for SAF with lifecycle emissions reductions exceeding 50%.

HIF Global's Haru Oni pilot plant in Chile demonstrated end-to-end e-fuel production in 2023, producing methanol from direct air captured CO2 and wind-powered electrolysis hydrogen, then converting methanol to gasoline via a methanol-to-gasoline (MTG) process. The facility's current production cost of approximately $50 per gallon is far above fossil jet fuel at $2 to $3 per gallon, but the company's planned commercial-scale facility in Texas targets $6 to $8 per gallon by 2028 through scale, lower-cost renewable electricity, and process optimization (HIF Global, 2025).

Twelve (formerly Opus 12) uses a solid oxide CO2 electrolyzer to convert CO2 directly to CO (carbon monoxide), which is then combined with hydrogen via Fischer-Tropsch synthesis to produce jet fuel. The company's approach eliminates the intermediate hydrogen-to-methanol step, potentially reducing capital costs by 15 to 25%. Twelve secured a contract with the US Air Force to supply e-fuel for testing in 2025 and broke ground on its first commercial-scale facility in Moses Lake, Washington, with target production capacity of 50 million gallons per year by 2028.

CO2-to-Methanol and Ethanol

Methanol is the highest-volume chemical target for CO2 utilization because it serves as both a fuel and a platform chemical for producing formaldehyde, acetic acid, olefins, and other downstream products. Carbon Recycling International (CRI) has operated the George Olah CO2-to-methanol plant in Iceland since 2012, producing 4,000 tonnes of renewable methanol per year from geothermal CO2 and electrolytic hydrogen. The facility has demonstrated over 95% uptime and methanol purity exceeding 99.5%, proving the technical viability of catalytic CO2 hydrogenation at commercial scale.

LanzaTech has pioneered a biological pathway, using engineered Clostridium autoethanogenum bacteria to ferment CO2-rich industrial waste gases into ethanol and other chemicals. The company has three commercial-scale facilities operating in China and Belgium, with combined ethanol production capacity exceeding 100 million gallons per year. LanzaTech's biological approach operates at ambient temperature and pressure, reducing capital and energy costs compared to thermocatalytic processes. The company's ethanol is currently used by Coty and Zara as a feedstock for sustainable packaging and textiles, respectively, demonstrating the procurement pathway from industrial emissions to consumer products (LanzaTech, 2025).

What's Not Working

Cost Competitiveness Without Subsidies

The most significant challenge across all CCU subsegments is that virtually no pathway achieves cost parity with fossil-derived incumbents without policy support. E-fuels cost 3 to 10 times more than fossil jet fuel. CO2-derived methanol costs $600 to $900 per tonne versus $300 to $400 per tonne for natural gas-derived methanol. Even mineralization, the most cost-competitive pathway, relies on voluntary green premiums or procurement mandates to generate sufficient demand. If 45Q tax credits expire or carbon prices decline, the economic case for many CCU projects collapses. Procurement teams must assess policy risk alongside technical and supply chain risk when evaluating long-term CCU supply agreements.

Green Hydrogen Availability and Cost

E-fuels and CO2-to-chemicals pathways that rely on hydrogen are constrained by green hydrogen supply and cost. Producing one tonne of e-methanol requires approximately 0.2 tonnes of green hydrogen, which at current costs of $4 to $7 per kilogram translates to a hydrogen input cost alone of $800 to $1,400 per tonne of methanol. The US Department of Energy's Hydrogen Hub program aims to bring green hydrogen costs below $2 per kilogram by 2030, but achieving this target at scale requires massive buildout of electrolyzer capacity and dedicated renewable electricity generation that competes with grid decarbonization priorities.

Lifecycle Emissions Accounting Disputes

The GHG Protocol's 2025 draft guidance on CCU product accounting remains contested. Key unresolved questions include: how to allocate emissions between the CO2 source (emitter), the utilization facility, and the end product user; whether CO2 used in fuels (which is re-released upon combustion) should count as a Scope 3 reduction for the product purchaser; and how to account for the energy penalty of capture and conversion, which can consume 30 to 50% of the embedded energy in the final product. Until accounting standards are finalized, procurement teams face audit risk when claiming Scope 3 reductions from CCU product purchases.

Scale Limitations in Mineralization

While mineralization is technically mature, the total addressable CO2 volume is limited by construction material demand. If every tonne of US concrete production incorporated CarbonCure's technology, total CO2 mineralization would reach approximately 15 million tonnes per year, representing less than 0.3% of US annual CO2 emissions. Scaling mineralization to climate-relevant volumes requires new applications beyond concrete, including mine tailings carbonation, enhanced rock weathering, and ocean alkalinity enhancement, all of which remain at pilot or early commercial stage.

Key Players

Established Companies

CarbonCure Technologies: leading CO2 mineralization technology provider with deployments at over 700 concrete plants across North America. Solidia Technologies: commercialized CO2-cured concrete and cement processes reducing carbon footprint by up to 70%. Carbon Recycling International: operator of the world's first commercial CO2-to-methanol plant in Iceland since 2012. LanzaTech: gas fermentation platform converting CO2-rich waste gases to ethanol and chemicals at three commercial facilities.

Startups

Twelve (formerly Opus 12): CO2 electrolyzer technology converting captured CO2 directly to CO for Fischer-Tropsch fuel and chemical production. Blue Planet Systems: synthetic limestone aggregate production from mineralized CO2 for construction applications. Prometheus Fuels: electrochemical CO2-to-fuel process targeting gasoline and jet fuel at competitive costs. Infinium: e-fuels producer targeting ultra-low-carbon diesel and jet fuel from CO2 and green hydrogen.

Investors and Funders

Breakthrough Energy Ventures: major investor in CarbonCure, LanzaTech, and multiple CCU startups through climate technology fund. OGCI Climate Investments: oil and gas industry consortium investing in CCUS and CCU technologies. Amazon Climate Pledge Fund: investor in CarbonCure and Infinium as part of corporate decarbonization procurement strategy. US Department of Energy: primary funder of CCU research and demonstration through the Carbon Utilization Program, allocating $500 million in grants through 2027.

Action Checklist

• Audit current procurement categories (concrete, aggregates, fuels, chemicals, polymers) for CO2-derived product availability from qualified suppliers
• Evaluate CO2-mineralized concrete specifications against project requirements and confirm compliance with relevant ASTM, ACI, and DOT standards
• Request lifecycle emissions data from CCU product suppliers using ISO 14067 or EPD (Environmental Product Declaration) methodologies for Scope 3 accounting
• Assess policy risk by mapping 45Q credit expiration timelines and CBAM phase-in schedules against planned procurement contract durations
• Negotiate offtake agreements with e-fuel producers for SAF blending requirements, prioritizing suppliers with secured green hydrogen supply and renewable electricity contracts
• Engage internal sustainability and finance teams on GHG Protocol CCU accounting treatment to ensure audit-ready documentation of claimed emissions reductions
• Join industry procurement consortia such as the First Movers Coalition or Sustainable Aviation Buyers Alliance to aggregate demand and secure preferential pricing

FAQ

Q: Which CO2 utilization pathway offers the best return for procurement teams seeking Scope 3 reductions? A: Carbon mineralization in concrete offers the most straightforward Scope 3 reduction pathway today because the CO2 is permanently sequestered, the products meet existing specifications, pricing is competitive, and the accounting treatment is relatively unambiguous under current GHG Protocol guidance. E-fuels provide lifecycle emissions reductions but the CO2 is re-released upon combustion, creating accounting complexity. Chemical feedstock pathways vary by product durability.

Q: How should procurement teams evaluate the credibility of CCU product emissions claims? A: Request third-party verified lifecycle assessments conforming to ISO 14044/14067 or product-category-specific Environmental Product Declarations (EPDs). Verify that the assessment includes the full energy penalty of CO2 capture and conversion, the carbon source (biogenic, atmospheric, or fossil point-source), and the end-of-life emissions pathway. Be cautious of claims that count the avoided emissions of displaced conventional products without accounting for the conversion energy input.

Q: What is the realistic timeline for e-fuels to reach cost parity with fossil jet fuel? A: Most industry analysts project e-fuel costs declining to $4 to $6 per gallon by 2030 and $2 to $4 per gallon by 2035, assuming green hydrogen costs fall below $2 per kilogram and electrolyzer and Fischer-Tropsch reactor costs decline along learning curves similar to solar PV. Full cost parity without subsidies is unlikely before 2035 at the earliest. In the interim, regulatory mandates (ReFuelEU, CORSIA, SAF Grand Challenge) create a compliance-driven market where cost premiums are absorbed as a regulatory cost rather than a procurement optimization variable.

Q: Are CO2-derived chemicals competitive with petrochemical incumbents today? A: In most commodity chemical markets, CO2-derived products remain 50 to 200% more expensive than fossil-derived equivalents. The exceptions are niche markets where green premiums are accepted (sustainable packaging, premium consumer products) and applications where 45Q credits or carbon pricing close the gap. LanzaTech's bio-ethanol has achieved cost competitiveness in specific applications due to low-cost industrial waste gas feedstocks and co-product revenue streams, but this model depends on proximity to steel mills and other heavy industrial emitters.

Sources

• Lux Research. (2025). CO2 Utilization Market Outlook: Technologies, Applications, and Competitive Landscape 2025-2032. Boston, MA: Lux Research Inc.
• US General Services Administration. (2025). Federal Green Construction Procurement Guide: Low-Carbon Materials Specifications. Washington, DC: GSA.
• HIF Global. (2025). Haru Oni to Texas: Scaling Power-to-Fuels from Pilot to Commercial Production. Houston, TX: HIF Global LLC.
• LanzaTech. (2025). Annual Impact Report 2024: Gas Fermentation at Commercial Scale. Skokie, IL: LanzaTech Inc.
• International Energy Agency. (2025). CO2 Utilization in the Energy Transition: Status and Pathways. Paris: IEA.
• US Department of Energy. (2025). Carbon Utilization Program: Funded Projects and Performance Metrics. Washington, DC: DOE Office of Fossil Energy and Carbon Management.
• Global CCS Institute. (2025). Global Status of CCS and CCU: 2025 Report. Melbourne: Global CCS Institute.