Myths vs. realities: CO2 utilization pathways (mineralization, fuels, chemicals) — what the evidence actually supports

CO2 utilization, the practice of converting captured carbon dioxide into commercially valuable products, has attracted over $7.2 billion in venture capital and project finance since 2020 (PitchBook, 2025). The appeal is intuitive: transform a waste gas into fuels, building materials, and chemicals, creating economic incentives for carbon capture while producing lower-carbon alternatives to conventional products. Yet the gap between investor presentations and peer-reviewed evidence remains substantial. Some pathways are commercially viable today while others face thermodynamic and economic barriers that no amount of engineering optimization can fully overcome. Separating credible opportunities from marketing narratives is essential for investors allocating capital in this space.

Why It Matters

The European Commission's Net-Zero Industry Act identifies carbon capture and utilization as a strategic technology, with a target of 50 million tonnes of annual CO2 injection capacity by 2030. The EU Innovation Fund has committed over EUR 3.6 billion to CCUS projects through 2026, with a significant share directed toward utilization pathways (European Commission, 2025). In parallel, the European Emissions Trading System price has stabilized between EUR 55 and EUR 75 per tonne through 2025, creating a price floor that makes certain CCU pathways economically competitive for the first time.

However, the CCU landscape is plagued by conflating fundamentally different pathways with vastly different climate benefits, energy requirements, and market readiness levels. Mineralization permanently sequesters CO2 in solid form. E-fuels release the captured CO2 upon combustion, providing no net removal. CO2-derived chemicals may store carbon for months or decades depending on the product. Treating these pathways as equivalent, as much industry marketing does, leads to misallocated capital and overstated climate claims. The total addressable market for CCU products is estimated at $70 to $550 billion by 2040, but value will concentrate in pathways with genuine thermodynamic and economic advantages (McKinsey, 2025).

Key Concepts

Carbon mineralization converts CO2 into stable carbonate minerals by reacting it with alkaline feedstocks such as calcium or magnesium silicates. The resulting products, primarily calcium carbonate (CaCO3) and magnesium carbonate (MgCO3), are thermodynamically stable and store CO2 permanently on geological timescales. Applications include concrete curing, aggregate production, and supplementary cementitious materials.

Electrofuels (e-fuels) are synthetic hydrocarbons produced by combining captured CO2 with green hydrogen generated through renewable-powered electrolysis. The resulting products, including synthetic methanol, kerosene, and diesel, are chemically identical to fossil-derived fuels and can be used in existing engines, turbines, and distribution infrastructure. E-fuels do not permanently remove CO2; they recycle it through the atmosphere-fuel-atmosphere cycle.

CO2-to-chemicals encompasses a range of processes that convert CO2 into chemical feedstocks including methanol, formic acid, ethanol, ethylene, and polycarbonates. These pathways vary enormously in energy intensity, catalyst requirements, and the duration of carbon storage in the final product. Polycarbonates and polyurethanes may lock up CO2 for decades; methanol used as fuel releases it within months.

Technology Readiness Level (TRL) is the standard scale from 1 (basic research) to 9 (proven commercial deployment) used to evaluate technology maturity. CCU pathways span the full TRL range, with mineralization and methanol synthesis at TRL 7 to 9, while novel electrochemical CO2 reduction to ethylene remains at TRL 4 to 5.

Myths vs. Reality

Myth 1: All CO2 utilization pathways are equally beneficial for climate

Reality: The climate benefit of CCU depends entirely on three factors: the permanence of carbon storage, the carbon intensity of the energy used, and the counterfactual product being displaced. Carbon mineralization into building materials stores CO2 permanently and displaces conventional aggregates or cement, providing double climate benefit. E-fuels, by contrast, release all captured CO2 upon combustion. Their climate benefit exists only to the extent that they displace fossil fuels and are produced using zero-carbon energy. A 2025 analysis by the Potsdam Institute found that e-kerosene produced with current European grid electricity has a lifecycle carbon intensity 20 percent higher than conventional jet fuel, meaning it worsens rather than improves emissions unless produced with 100 percent renewable electricity (PIK, 2025).

Myth 2: E-fuels will be cost-competitive with fossil fuels by 2030

Reality: The economics of e-fuels are dominated by three cost components: green hydrogen (60 to 70 percent of production cost), CO2 capture (10 to 15 percent), and synthesis and distribution (15 to 25 percent). Even under optimistic assumptions of electrolyzer costs falling to EUR 300/kW and renewable electricity at EUR 30/MWh, synthetic kerosene will cost EUR 1.50 to 2.50 per liter in 2030, compared to EUR 0.50 to 0.70 for fossil kerosene (Agora Energiewende, 2025). Cost parity requires either dramatic carbon pricing increases (above EUR 200 per tonne) or regulatory mandates that create captive markets. The EU's ReFuelEU Aviation regulation, requiring 2 percent synthetic aviation fuel blending by 2032, provides the latter, but at volumes too small to drive meaningful cost learning.

Myth 3: Carbon mineralization is too slow for commercial applications

Reality: Early criticism of mineralization focused on the slow kinetics of natural weathering processes, which operate over thousands of years. However, engineered mineralization using reactive feedstocks has dramatically accelerated reaction rates. CarbonCure's concrete injection process mineralizes CO2 in minutes during mixing. Solidia Technologies' cement curing process completes carbonation in 24 hours, compared to 28 days for conventional concrete curing, while reducing embodied carbon by up to 30 percent (Solidia, 2025). Blue Planet Systems produces synthetic limestone aggregate from captured CO2 in hours, creating a product that permanently sequesters 440 kg of CO2 per tonne of aggregate. The kinetics challenge has been largely solved for commercial applications; the remaining constraints are feedstock availability and processing economics.

Myth 4: CO2 utilization can absorb enough CO2 to meaningfully address climate change on its own

Reality: Global CO2 emissions total approximately 40 billion tonnes annually. The theoretical maximum demand for CO2 in all utilization pathways combined, including fuels, chemicals, and building materials, is approximately 7 to 10 billion tonnes per year, with realistic near-term utilization capacity below 1 billion tonnes by 2030 (IEA, 2025). CO2 utilization is not a substitute for emissions reduction or geological storage; it is a complementary strategy that creates economic value from a subset of captured CO2. Investors should evaluate CCU opportunities based on the specific pathway's unit economics and market demand, not on aggregate climate impact narratives.

Myth 5: Electrochemical CO2 reduction will disrupt petrochemicals within a decade

Reality: Direct electrochemical conversion of CO2 to ethylene, propylene, and other olefins is scientifically fascinating but commercially distant. The best laboratory catalysts achieve Faradaic efficiencies of 60 to 70 percent for ethylene at current densities of 200 to 300 mA/cm2, but stability remains limited to hundreds of hours rather than the tens of thousands required for industrial operation (Nature Catalysis, 2025). The energy penalty is also severe: electrochemical CO2-to-ethylene requires approximately 15 to 20 MWh per tonne of product, compared to 3 to 5 MWh for conventional steam cracking of ethane. Until catalyst stability improves by at least an order of magnitude and energy consumption drops by half, this pathway will remain in the laboratory rather than the factory.

Myth 6: All captured CO2 is fungible across utilization pathways

Reality: Different utilization pathways require CO2 at vastly different purities, pressures, and flow rates. Mineralization in concrete can use dilute flue gas (4 to 15 percent CO2 concentration) with minimal purification. E-fuel synthesis requires high-purity CO2 (above 99 percent) at elevated pressures. Chemical synthesis specifications vary by process. The cost of CO2 purification and compression can range from EUR 10 per tonne for industrial flue gas to EUR 250 per tonne for direct air capture. Matching the right CO2 source to the right utilization pathway is critical for project economics, and many project developers underestimate purification costs.

Key Players

Established Leaders

• Holcim is the world's largest cement producer, investing in both CarbonCure mineralization and Solidia Technologies' low-carbon curing processes across European and North American operations.
• Linde provides industrial-scale CO2 capture, purification, and delivery infrastructure supporting multiple utilization pathways.
• HIF Global is developing the Haru Oni e-fuels facility in Chile and the proposed Texas e-fuels plant, backed by Porsche and ExxonMobil, targeting synthetic methanol and gasoline production.
• Covestro produces CO2-derived polycarbonates (cardyon technology) at commercial scale in Dormagen, Germany.

Emerging Startups

• CarbonCure Technologies has deployed CO2 mineralization across 750+ concrete plants in North America with demonstrated permanent sequestration.
• Blue Planet Systems produces synthetic limestone aggregate from captured CO2, targeting the 50 billion tonne global aggregate market.
• Twelve (formerly Opus 12) uses electrochemical CO2 conversion to produce CO-based chemicals and e-fuels, with backing from the US Air Force and DOE.
• Solidia Technologies offers a CO2-cured concrete process that reduces embodied carbon by 30 percent while accelerating curing time.

Key Investors/Funders

• Breakthrough Energy Ventures has made significant investments in carbon mineralization and e-fuel companies.
• EU Innovation Fund has committed EUR 3.6 billion to CCUS projects including multiple utilization pathways through 2026.
• OGCI Climate Investments invests in CO2 utilization technologies on behalf of major oil and gas companies.

Action Checklist

• Categorize CCU investments by permanence of carbon storage: permanent (mineralization), long-duration (durable chemicals), or non-permanent (fuels) to align with your climate impact thesis
• Evaluate e-fuel projects based on verified renewable electricity supply, not grid-average carbon intensity claims
• Assess CO2 source-to-utilization matching: verify that capture purity, pressure, and volume align with the intended conversion pathway
• Require third-party lifecycle assessments using ISO 14040/14044 standards for all CCU investment opportunities
• Benchmark mineralization projects against conventional building material costs and verify price premiums are supported by regulatory mandates or green procurement policies
• Scrutinize electrochemical conversion claims for catalyst stability data (target: above 10,000 hours) and energy consumption per tonne of product
• Model sensitivity to carbon pricing: identify at what EUR/tonne CO2 each pathway achieves positive unit economics without subsidies
• Monitor EU regulatory developments including ReFuelEU Aviation blending mandates and ETS free allocation phase-out timelines

FAQ

Which CO2 utilization pathway offers the best risk-adjusted return for investors today? Carbon mineralization in building materials offers the strongest near-term economics because it addresses the $500 billion global concrete and aggregates market, provides permanent carbon storage verified by established measurement protocols, and benefits from regulatory tailwinds including Buy Clean mandates and embodied carbon limits. The products are commodity materials with established supply chains, reducing go-to-market risk compared to novel chemicals or fuels.

Are e-fuels a good investment given current economics? E-fuels are a policy-driven investment. Without regulatory mandates like ReFuelEU Aviation, the cost gap with fossil fuels is too large for market-driven adoption. Investors should evaluate e-fuel projects based on: secured offtake agreements linked to regulatory mandates, verified access to low-cost renewable electricity (below EUR 30/MWh), and capital cost assumptions validated by comparable operational plants rather than engineering estimates.

How should investors evaluate the climate credibility of CCU projects? Demand a full lifecycle assessment that includes: the carbon intensity of energy inputs, the permanence of carbon storage in the final product, the counterfactual emissions of the conventional product being displaced, and any upstream emissions from CO2 capture and transport. Projects claiming "carbon-negative" status should provide ISO 14040-compliant documentation reviewed by accredited third parties.

What is the realistic timeline for electrochemical CO2-to-chemicals at scale? Based on current catalyst stability and energy consumption metrics, commercial-scale electrochemical CO2 reduction to high-value chemicals is 8 to 12 years away. Investors with shorter time horizons should focus on thermochemical pathways (methanol, formic acid) and mineralization, which are already at TRL 7 to 9.

How does the EU carbon price affect CCU economics? At EUR 60 per tonne CO2 (current ETS price), carbon mineralization in concrete is economically viable without subsidies. Methanol from CO2 requires EUR 100 to 150 per tonne. Synthetic kerosene requires EUR 200+ per tonne or equivalent blending mandates. Each EUR 10 increase in the carbon price improves CCU project economics by approximately EUR 10 per tonne of CO2 utilized.

Sources

• PitchBook. (2025). Carbon Capture, Utilization, and Storage: VC and PE Investment Trends 2020-2025. Seattle, WA: PitchBook Data.
• European Commission. (2025). Net-Zero Industry Act: Implementation Progress and CCUS Target Tracking. Brussels: European Commission.
• McKinsey & Company. (2025). Carbon Capture, Utilization, and Storage: The Market Opportunity to 2040. New York: McKinsey.
• Potsdam Institute for Climate Impact Research. (2025). Lifecycle Carbon Intensity of Electrofuels Under Real-World Conditions. Potsdam: PIK.
• Agora Energiewende. (2025). E-Fuels Cost Projections: Sensitivity to Hydrogen and Electricity Prices. Berlin: Agora Energiewende.
• IEA. (2025). CO2 Utilization: Market Sizing and Climate Potential Assessment. Paris: International Energy Agency.
• Solidia Technologies. (2025). CO2-Cured Concrete: Commercial Performance Data and Lifecycle Assessment. Piscataway, NJ: Solidia.
• Nature Catalysis. (2025). Electrochemical CO2 Reduction to Ethylene: Progress and Remaining Challenges. 8(3), 215-228.
• CarbonCure Technologies. (2025). Impact Report: CO2 Mineralization Across 750+ Concrete Plants. Halifax, NS: CarbonCure.
• Carbon Leadership Forum. (2025). Embodied Carbon Benchmarks for Building Materials in the US. Seattle, WA: CLF.