Carbon capture could help turn CO2 into fuels, chemicals and building materials

A new report from the World Economic Forum warns that current plans for carbon capture and utilisation (CCU) fall well short of what is needed to meet global climate goals. The study, launched today in collaboration with Wood Mackenzie, concludes that planned CCU projects represent only around six percent of the scale required by 2040 to align with international targets. The report, Defossilizing Industry: Considerations for Scaling-up Carbon Capture and Utilization Pathways, outlines how industries could transform captured carbon dioxide into fuels, chemicals and building materials, creating new markets while cutting emissions. It argues that CCU has the potential to convert carbon from a liability into an asset, generating jobs and value chains across multiple sectors. However, it warns that without stronger policy signals and investment, the opportunity will remain unrealised.

Fernando Gómez, Head of the Future of Materials at the World Economic Forum, said: “scaling CCU could be an economic opportunity while offering an additional path to abate CO? emissions. With credible policy signals, long-term investment and cross-sector partnerships, CO? could mature from a liability into an asset creating new market value while accelerating industrial decarbonisation.”

CCU technologies aim to capture carbon dioxide and reuse it in industrial processes, extending its economic value while reducing reliance on fossil resources. While some applications, such as urea production for agriculture, are well established, most emerging uses remain commercially immature. These include electrochemical conversion and mineralisation for building materials, both of which are being developed by start-ups and innovators. According to the report, the lack of consistent policy, outdated financing models and integration challenges have slowed progress.

Activity is currently concentrated in regions where governments or regulators have provided financial or legislative support, such as Western Europe, the Gulf States, China, Australia, the United States and Canada. These areas are home to the first non-urea projects beginning to move from pilot stage towards larger deployment.

The report highlights three areas of action needed to accelerate adoption. First, technology-neutral incentives that reward both permanent and shorter-term climate solutions. Second, long-term and blended financing to bridge early-stage funding gaps and support first-of-a-kind projects. Third, cross-industry collaboration to integrate technologies, build demand and enable scaling.

Simon Flowers, Chairman and Chief Analyst at Wood Mackenzie, said: “Our data shows that without stronger policy support and market creation, CCU will remain a missed opportunity. But with the right enabling conditions, it can make a measurable impact in industrial emissions and stimulate new competitive value chains.”

The report also draws attention to innovators advancing breakthrough technologies, including winners of the Forum’s “UpLink CCU Challenge”. These companies are working on areas such as electrochemical carbon conversion and carbon mineralisation. According to the study, government and industry support will be vital in helping such firms secure offtake agreements, prove market viability and open the way for wider adoption by larger organisations.

The findings will shape discussion at the World Economic Forum’s Sustainable Development Impact Meetings 2025, being held in New York from 22 to 26 September. The event will bring together more than 1,000 leaders from business, government and civil society to explore strategies for accelerating CCU, unlocking new value streams and driving industrial decarbonisation.