Carbon capture and storage (CCS) is moving from niche pilot projects to a global climate strategy worth billions. Once seen as a backup plan, it’s now racing to the forefront — from massive U.S. industrial hubs to China’s fast-expanding carbon pipelines. Supporters call it essential for tackling the world’s toughest emissions in steel, cement, and energy. Critics warn it could be a costly detour.

As governments, investors, and big tech pour money into CCS, one question looms: can it deliver the deep carbon cuts needed to hit net zero by 2050?

This guide walks you through everything you need to know: how CCS works, the latest technologies, the biggest projects and market leaders, and where the fastest growth is happening. 

We’ll also explore market trends, policy drivers, corporate demand, and the risks investors should watch. Whether you’re new to CCS or tracking it as a climate tech opportunity, this resource covers the science, the strategy, and the business potential shaping the future of carbon removal.

What is Carbon Capture and Storage (CCS)?

Carbon Capture and Storage is a climate technology designed to prevent carbon dioxide (CO₂) from entering the atmosphere. It captures CO₂ emissions from places like power plants, cement factories, and steel mills. This happens before the emissions can add to global warming.

A related term is Carbon Capture, Utilization, and Storage (CCUS). It takes things further by using captured CO₂ in products like synthetic fuels, building materials, or plastics.

The key difference between CCS and CCUS lies in the “U” — utilization. In CCS, the captured CO₂ is permanently stored underground, while in CCUS, part or all of that CO₂ is repurposed for industrial use before storage.

This technology helps fight climate change. It can reduce emissions from hard-to-decarbonize industries. The Intergovernmental Panel on Climate Change (IPCC) and the International Energy Agency (IEA) both recognize CCS as a critical tool for achieving net-zero targets.

Global climate agreements, like those at the annual UN Climate Change Conferences (COP), stress that CCS is key to limiting global temperature rise to below 1.5°C.

• KEY EVENT: Carbon Capture, Utilization and Storage (CCUS) Conference 2025

How Carbon Capture Works: A Step-by-Step Process

CCS works in three main stages — capture, transport, and storage — with an optional fourth step for utilization. Let’s break down each one of them. 

1. Capture: The process starts by separating CO₂ from other gases produced during industrial processes or electricity generation. This can be done at power plants, cement kilns, oil refineries, and other facilities. Special chemical solvents, membranes, or advanced filters are used to remove CO₂ from flue gas or fuel before combustion.
2. Transport: Once captured, CO₂ must be moved to a storage or utilization site. The most common method is through high-pressure pipelines. In some cases, ships or even trucks carry CO₂ over long distances, especially if storage sites are far from industrial hubs.
3. Storage: For permanent storage, CO₂ is injected deep underground into geological formations such as saline aquifers or depleted oil and gas fields. These sites are chosen for their ability to trap CO₂ securely for thousands of years, with monitoring systems in place to detect any leaks.
4. Utilization: In CCUS projects, some or all of the captured CO₂ is reused instead of being stored immediately. It can be converted into synthetic fuels, used in making cement and plastics, or even injected into greenhouses to boost plant growth. While utilization does not always result in permanent storage, it can reduce the need for fossil-based raw materials.

Tech Toolbox: The Many Ways of Capturing Carbon

CCS is not a single technology. Different methods are used depending on the type of facility, the fuel being used, and the stage at which CO₂ is removed. The main types are:

Post-combustion capture: This is the most common method today. CO₂ is removed from the exhaust gases after fuel has been burned. Chemical solvents or filters separate the CO₂ from other gases before it is compressed for transport.

Pre-combustion capture: Here, the fuel is treated before it is burned. The process converts the fuel into a mixture of hydrogen and CO₂. The CO₂ is separated and stored, while the hydrogen can be used to produce energy without direct emissions.

Oxy-fuel combustion: In this method, fuel is burned in pure oxygen instead of air. This creates a stream of exhaust that is mostly CO₂ and water vapor, making it easier to capture the CO₂.

Direct Air Capture (DAC): DAC removes CO₂ from the air instead of just one source. It uses big fans and chemical filters to do this. It can be used anywhere but requires more energy because CO₂ in the air is less concentrated.

As of end-2024, around 53 DAC plants were expected to be operational globally, rising to 93 by 2030 with a capacity of 6.4–11.4 MtCO₂/year. 

Bioenergy with CCS (BECCS): This approach combines biomass energy production with carbon capture. Plants absorb CO₂ while growing, and when the biomass is burned for energy, the emissions are captured and stored. This can result in “negative emissions,” removing CO₂ from the atmosphere.

• RELATED: What’s New in Verra’s Latest CCS Methodology Update? Find Out!

Global Race: Which Countries Are Winning CCS Leadership

Carbon capture and storage is now a reality. It’s in operation in many countries, with numerous projects either planned or being built. CCS technology is still new compared to global emissions. But momentum is growing.

Governments, industries, and investors are now committing to large-scale deployment. CCS capacity differs between regions:

United States

The U.S. leads CCS deployment, holding about 40% of global operational capacity. By mid-2024, facilities captured roughly 22–23 Mt CO₂ annually. Growth is driven by the expanded 45Q tax credit under the Inflation Reduction Act, rewarding storage and utilization. Flagship projects include Petra Nova in Texas and Midwest CCS hubs serving ethanol, fertilizer, and industrial sites.

Canada

Canada hosts pioneering projects like Boundary Dam (the world’s first commercial coal CCS) and Quest in Alberta, capturing CO₂ from hydrogen linked to oil sands. National capacity is ~4 Mt per year, supported by a federal CCS investment tax credit targeting heavy industry and clean hydrogen. 

Norway

Norway has led offshore CO₂ storage since the Sleipner project began in 1996, injecting ~1 Mt annually into a saline aquifer. The Northern Lights project, part of Longship, will create a shared CO₂ transport and storage network for European industries.

China

China’s CCS capacity grew from ~1 Mt/year in 2022 to over 3.5 Mt in 2024, mainly in coal-to-chemicals, gas processing, and EOR. CCS is now part of national climate strategies, signaling rapid expansion.

United Kingdom

The UK’s cluster model links industries via shared pipelines and offshore storage. The East Coast Cluster and HyNet, due late 2020s, could together capture over 20 Mt CO₂ annually.

Australia

Australia’s ~4 Mt/year capacity includes the massive Gorgon gas-linked CCS facility in Western Australia, despite operational setbacks. With vast geological storage potential, the country aims to be a CO₂ storage hub for Asia’s export industries.

Total Operational Capacity and Growth

As of 2024, global CCS facilities in operation had a combined capture capacity of just over 50 million tonnes of CO₂ per year. This shows steady growth, up from about 40 Mt a few years ago. However, it still accounts for just a small part of the over 40 billion tonnes of CO₂ emitted worldwide each year.

However, the project pipeline is expanding quickly. The facilities being built will double the current capacity. Early development projects might raise global capacity to over 400 million tonnes per year by the early 2030s if they stay on track.

The Rise of CCS Hubs and Clusters

A key trend in the industry is the creation of CCS hubs—shared infrastructure networks where multiple companies use the same transport and storage systems. This model lowers costs and speeds up deployment by avoiding the need for every facility to build its own pipeline or storage site.

The U.S. Midwest ethanol corridor, Norway’s Northern Lights, and the UK’s industrial clusters are among the most advanced examples. These hubs usually form close to industrial areas. Here, emissions are high, and the current infrastructure, like pipelines and ports, can be adjusted for CO₂ transport.

• SEE MORE: Gevo Launches Carbon Removal Credit Sales, Scales CCS in North Dakota

Why CCS Matters in the Climate Fight

Carbon capture and storage is not meant to replace renewable energy or other climate solutions. Instead, it focuses on the toughest parts of the emissions problem—places where cutting CO₂ is especially hard or expensive. Experts call these hard-to-abate sectors.

Hard-to-Abate Sectors

Some industries can’t simply switch to clean electricity. For example, making steel requires very high heat and chemical reactions that release CO₂. Cement production also releases CO₂ as a byproduct of making clinker, the key ingredient in concrete.

Chemical plants and refineries have complex processes that generate large amounts of CO₂. Even aviation faces limits, since planes can’t yet fly long distances on batteries alone. CCS can capture emissions from these sources. This helps reduce climate impact while keeping production running.

Here is the technology’s application in various industries:

Role in Meeting the 1.5°C Target and Net-Zero by 2050

To avoid the worst effects of climate change, scientists say global warming must be kept to 1.5°C above pre-industrial levels. That means reaching net-zero emissions by around 2050. 

The Intergovernmental Panel on Climate Change (IPCC) has run hundreds of models to see how this can be done. In most scenarios, CCS plays a key role. Without it, the cost of meeting climate targets could rise by 70% or more, because other solutions would have to carry the full load.

Synergies with Clean Hydrogen, Carbon Markets, and Industrial Strategy

CCS also works well with other low-carbon solutions. CCS captures CO₂ that would escape when producing clean hydrogen, especially “blue hydrogen” from natural gas. This creates a cleaner fuel for use in transport, heating, and industry.

In carbon markets, CCS can generate credits for each tonne of CO₂ captured and stored. These credits can be sold to companies looking to offset their emissions. Governments are also linking CCS to industrial strategy by building shared hubs and pipelines. These will serve multiple factories, power plants, and fuel producers. This makes CCS cheaper and faster to deploy.

Endorsements from the IEA and UN

The International Energy Agency (IEA) calls CCS “critical” for reaching net zero, especially in heavy industry. It estimates the world will need to store 1.2 billion tonnes of CO₂ each year by 2050.

The United Nations also recognizes CCS in its climate plans. It has been featured in multiple COP agreements as a key technology for both reducing emissions and removing CO₂ from the atmosphere. These endorsements matter because they help drive policy support, funding, and international cooperation.

CCS Investment and Financing: How Much Does It Cost?

Carbon capture and storage can make a big impact on emissions. But it comes with a high price tag. Most projects cost between $50 and $150 for every tonne of CO₂ (and even over $400 for some technologies) captured and stored.

The lower end usually applies to large industrial sites near storage locations. The higher end often applies to smaller or more complex projects, or those that require long transport pipelines.

Government Support

Governments play a key role in making CCS affordable. In the U.S., the 45Q tax credit offers up to $85 per tonne for CO₂ stored underground and $60 per tonne for CO₂ used in other industrial processes.

Canada provides an Investment Tax Credit (ITC) covering up to 50% of eligible CCS costs. In Europe, the Innovation Fund supports early-stage CCS and other low-carbon projects, offering billions in grants.

Blended Finance and Partnerships

Because CCS is expensive, many projects rely on blended finance—a mix of public and private funding. Oil and gas companies invest in cutting carbon emissions. Meanwhile, governments help by offering grants and tax breaks.

Public-private partnerships are common, especially for shared CCS hubs where multiple companies use the same pipelines and storage sites. International lenders, such as the World Bank and the Asian Development Bank, are funding CCS in emerging economies.

Voluntary Carbon Market (VCM)

CCS can also generate carbon removal credits for sale in the voluntary carbon market. These credits are purchased by companies aiming to offset their emissions.

While VCM prices vary, high-quality removal credits often sell for $100 per tonne or more, making them a potential revenue stream for CCS operators. Market demand for CCS-based credits is still growing. It relies on trust in the technology’s monitoring and verification.

• RELEVANT: Global Investment in CCS Surges Toward $80 Billion as Climate Goals Drive Demand

Investor Angle: How to Invest in the CCS Industry

Interest in carbon capture and storage is rising among ESG, climate tech, and energy transition investors. The global CCS market was valued at about $4.5 billion in 2023 and could grow to more than $20 billion by 2033, according to industry forecasts. This growth is being driven by stricter climate policies, corporate net-zero pledges, and rising carbon prices.

Public Stocks

Investors can buy shares in companies directly involved in CCS. Examples include Aker Carbon Capture (Norway), Occidental Petroleum (U.S.), Air Liquide (France), and ExxonMobil.

Many oil and gas majors now see CCS as essential to keeping their assets viable in a low-carbon future. These firms are investing billions in CCS hubs and carbon removal partnerships.

Private Startups

Private markets offer exposure to emerging technologies like DAC. Leading firms include Climeworks (Switzerland), CarbonCapture (U.S.), and Heirloom (U.S.).

DAC projects are smaller today but attract premium interest from tech backers and climate-focused venture capital. In 2022 alone, DAC startups raised over $1 billion in funding.

ETFs and Funds

There are also climate-focused ETFs and funds that include carbon removal technologies as part of their portfolios. These funds reduce risk by investing in various companies. They focus on CCS, renewable energy, hydrogen, and other low-carbon solutions.

Carbon Credit Markets

Some investors buy into CCS through the carbon credit market. This can be done by funding CCS or DAC projects that issue carbon removal credits.

Platforms like Puro.earth and CIX (Climate Impact X) connect investors with verified carbon removal projects. Credits from high-quality CCS projects can fetch $100–$200 per tonne depending on location and verification standards.

Due Diligence

Before investing, it is important to check policy risk, technology readiness, cost curves, and scalability. CCS works best in large industrial hubs with access to geological storage.  Finally, watch these key sectors because they will likely drive demand and scale for CCS: 

• The oil & gas sector uses CCS for enhanced oil recovery and to lower its emissions. 
• Cement firms need CCS because their production process emits CO₂ that can’t be avoided easily. 
• Hydrogen—especially blue hydrogen—depends on CCS to cut its carbon footprint. 
• DAC startups aim to remove CO₂ directly from the air and may sell high-value removal credits. 
• And carbon marketplaces and registries will shape how removal credits are priced and trusted.

These areas have the most potential to scale quickly as policies tighten and carbon prices rise.

Risks, Challenges, and Criticism of CCS

While CCS has strong potential as a climate solution, it faces several challenges that investors, policymakers, and project developers must consider.

• High Capital Costs and Slow ROI: Large CCS projects cost hundreds of millions to billions of dollars. At $50–$150 per tonne captured, returns depend on strong policy support, carbon pricing, or premium credits, with payback periods often spanning years.
• Energy Requirements and Lifecycle Emissions: CCS uses significant energy, sometimes from fossil fuels. Without low-carbon power, net emissions savings shrink, making efficiency improvements essential.
• Storage Risks: Leakage, Permanence, and Monitoring: Geological storage is generally safe, but leakage is possible. Continuous monitoring ensures CO₂ remains underground for centuries.
• Debate Over Fossil Fuel Dependency vs. Genuine Decarbonization: Critics say CCS can prolong fossil fuel use. Supporters argue it’s vital for industries like cement and steel.
• Policy Uncertainty and Lack of Global Standards: Policy changes can undermine project economics. The absence of global CO₂ measurement standards adds risk to cross-border investments.

Market Outlook (2024–2030): What’s Next for CCS?

The world is gearing up for a big expansion in carbon capture and storage. But just how fast will CCS grow—and what could power that growth?

Growing CCS Pipeline and Capacity

Momentum is clearly building. The Global CCS Institute reports a record 628 projects in the pipeline—an increase of over 200 from the previous year.

The expected annual capture capacity from these projects is 416 million tonnes of CO₂. This amount has been growing at a 32% rate each year since 2017. Once the current construction is completed, operational capacity is set to double to more than 100 Mt per year.

Similarly, the IEA sees global capture capacity rising from roughly 50 Mt/year today to about 430 Mt/year by 2030, with storage capability reaching 670 Mt/year.

Still, this is only a start. To meet global climate goals, CCS will need to scale much more, lasting into the billions of tonnes annually.

Policies Fueling Momentum

Governments are shoring up policy support to accelerate CCS rollout. Here are the regional trends so far:

• In the U.S., the Inflation Reduction Act (IRA) expanded the 45Q tax credit—making CCS more financially appealing for project developers.
• The EU’s Net-Zero Industry Act and updated Industrial Carbon Management Strategy aim to help the region capture at least 50 Mt by 2030, rising to 280 Mt by 2040.
• Across the Asia-Pacific, countries like Australia are positioning themselves as carbon storage hubs. With strong geology and policy backing, Australia could generate over US$500 billion in regional carbon storage revenue by 2050.

Corporate Buyers Powering Demand

Major companies are not just talking—they’re signing deals:

• Microsoft stands out as a leading buyer of carbon removal credits. It has contracted close to 30 million tonnes. This includes 3.7 million tonnes over 12 years with startup CO280 and 1.1 million tonnes in a 10-year deal with Norway’s Hafslund Celsio project.
• Shopify co-founded Frontier—a $925 million advance market commitment—with other big names like Stripe and Alphabet. It has also purchased over $80 million in carbon removal from startups using DAC, enhanced weathering, and other technologies.

These corporate purchases show a strong demand for CCS-backed removal credits. They also help build a stable market for project developers.

• READ MORE: Eni Picks Saipem for $590M Carbon Capture Project in UK’s Liverpool Bay

Carbon Pricing, ESG Rules, and Global Markets

CCS is also benefiting from broader climate market trends:

• Carbon pricing and trading systems globally are starting to include CCS credits. As prices rise, CCS projects can improve their economics.
• ESG reporting and net-zero commitments are increasing transparency and accountability. Firms are expected to show real results—CCS helps deliver that.
• The rise of international carbon markets and registries is creating standardized ways to value and certify carbon removals. This makes CCS credits more trustworthy and investable.

Quick Take

By 2030, CCS capacity could rise eightfold—from 50 million to over 400 million tonnes. This growth is being driven by government policy, big corporate offtake deals, and a maturing carbon credit market. While still far from what’s needed to fully tackle climate change, the CCS sector is clearly moving from pilot stage to commercial reality

The Role of CCS in a Net-Zero Future

CCS isn’t a silver bullet. It’s a vital tool that works with renewables, electrification, and nature-based solutions like reforestation.

Renewables stop future emissions. CCS tackles the emissions that still exist, especially from old infrastructure in steel, cement, and chemicals. These are costly and slow to replace. 

CCS captures emissions at the source. This helps extend facility lifespans and supports climate goals. It’s especially important for economies with new industrial assets.

Beyond reduction, CCS can enable permanent carbon removal through direct air capture and bioenergy with CCS, storing CO₂ underground for centuries. These methods can offset hard-to-abate sectors such as aviation and agriculture.

Responsible deployment is key. It needs strong MRV standards, community engagement, and alignment with sustainability goals. This helps avoid delays in phasing out fossil fuels.

CCS, when used wisely, connects our current fossil fuel economy to a low-carbon future. It helps reduce emissions we can’t fully eliminate yet and gives us time to develop cleaner technologies.

CCS is Not a Silver Bullet—But a Vital Tool

Carbon capture and storage is not a cure-all for the climate crisis. No single technology can deliver net zero on its own, and CCS should be viewed as one tool in a broader decarbonization toolkit. 

A balanced approach requires acknowledging both the potential and the limitations of CCS. The technology can cut emissions and even remove carbon permanently when it’s based on solid science, strong policies, and clear reporting.

However, overreliance or misuse—particularly if it delays the shift away from fossil fuels—risks undermining climate goals.

The pathway to net zero will demand a combination of innovation, investment, and urgency. Carbon capture and storage is part of that solution set, and with careful governance, sustained funding, and clear standards, it can help bridge the gap between today’s emissions reality and the low-carbon future we urgently need.

• FURTHER READING: Carbon Capture and Storage to Grow 4x by 2030: Is It a Turning Point for Climate Action?

The post What is Carbon Capture and Storage? Your Ultimate Guide to CCS Technology appeared first on Carbon Credits.

Steel is one of the most carbon-intensive materials on Earth, responsible for around 7% to 9% of global greenhouse gas emissions. The industry produces nearly two billion tonnes of crude steel annually, with average emissions ranging from 1.85 to 2.33 tonnes of CO2 for every tonne of steel. Despite being the backbone of infrastructure, renewable energy, and modern manufacturing, steel remains one of the hardest sectors to decarbonize.

Against this backdrop, ArcelorMittal, the world’s second-largest steelmaker, pledged in 2020 to slash emissions by 25% globally and 35% in Europe by 2030. It also announced a longer-term goal of reaching net zero by 2050. Yet, new findings suggest the company is falling behind, casting doubt on whether it will deliver on its climate promises.

Is ArcelorMittal Falling Short of 2030 Targets

In 2023, ArcelorMittal’s average emissions intensity was 1.92 tonnes of CO2 per tonne of steel, only a slight improvement from 2018 levels.

Experts and analysts have figured out that the company’s 5.4% reduction in carbon intensity since 2018 pales compared to what is needed to align with a 1.5°C climate pathway.

SteelWatch’s report Backtracking on Climate Action analysed that to meet its own 2030 targets, ArcelorMittal would need to cut emissions by around 3% annually. Instead, its progress has been less than 1% per year.

Even though the company often highlights its 46% cut in absolute Scope 1 and 2 emissions since 2018. At first glance, this appears to be major progress.

But a closer look reveals that most of the decline came from producing less steel, not from genuine decarbonization. Between 2018 and 2024, ArcelorMittal’s crude steel output dropped 37%, while its production capacity fell 32%. Emissions went down largely because activity slowed, not because the steel itself became greener.

This distinction matters. Reducing emissions intensity—how much CO2 is released per tonne of steel—is the key indicator of sustainable progress. ArcelorMittal’s modest improvement in intensity shows its operations remain highly carbon-intensive.

Billions for Shareholders, Pennies for Climate

The same SteelWatch report further explained stark imbalances in ArcelorMittal’s spending priorities. Between 2021 and 2024, the company allocated just $800 million to decarbonization projects. That figure represents less than 2.5% of the $32.6 billion it generated in operating cash flow.

Meanwhile, the company rewarded shareholders with $12 billion in dividends and share buybacks during the same period—nearly 15 times what it spent on climate action. Of the $5 billion ArcelorMittal had resolved for its 2030 climate strategy, only 16% has been spent so far. This raises questions about whether climate commitments are truly central to its strategy, or simply secondary to financial returns.

Its joint venture in India, AM/NS, illustrates the scale of this omission. ArcelorMittal’s share of emissions from the venture exceeded 10 million tonnes of CO2 in 2024. By 2026, the JV’s total emissions are expected to surpass 25 million tonnes annually, yet none of these are reflected in ArcelorMittal’s targets.

Delayed and Stalled Green Steel Projects

Reports also indicate that the steel giant received more than $3.5 billion in public subsidies to develop five flagship Direct Reduced Iron (DRI) projects in Europe and Canada. These projects, intended to shift steel production away from coal-based blast furnaces, could significantly reduce emissions. However, by mid-2025, none had reached a final investment decision.

The much-publicized near-zero carbon steel plant in Sestao, Spain, is among those delayed. In contrast, competitors such as SSAB in Sweden and Salzgitter in Germany are moving forward with binding investments in fossil-free steel, placing them on track to align with Paris climate goals. ArcelorMittal’s slow pace highlights a widening gap between ambition and execution.

Shifting Language: “Economic Decarbonization”

ArcelorMittal executives now describe their approach as “economic” or “competitive decarbonization.” In practice, this means they will only pursue climate action when it makes business sense. Critics argue this signals retreat, showing the company prioritizes profit over planetary responsibility. By framing decarbonization as conditional on market conditions, the company risks delaying meaningful change until well past 2030.

• ALSO SEE: Nippon Steel’s $6B Green Steel Shift Targets Net-Zero by 2050 

ArcelorMittal Says, “Progress Is Real, Despite Challenges”

In November 2024, the company updated its European decarbonisation plans. The company noted that final investment decisions for new DRI-EAF (Direct Reduced Iron – Electric Arc Furnace) projects could not proceed.

Challenges include green hydrogen still being too costly, natural gas-based DRI not being competitive, and carbon capture infrastructure remaining in planning. These hurdles make achieving the 2030 emissions intensity target increasingly unlikely.

Significant Emissions Cuts Already Achieved!

Despite challenges, the company says, progress is real. Its sustainability report shows that in 2024, absolute Scope 1 and 2 emissions dropped to 102 million tonnes—46% lower than the 188 million tonnes recorded in 2018.

The sale of higher-carbon assets helped reduce the average carbon intensity to 1.75 tonnes of CO2 per tonne of crude steel, compared with the global average of 1.92. On a portfolio-adjusted basis, intensity has fallen 5.4% since 2018.

Over the same period, it invested $1 billion in decarbonisation initiatives. Efforts included:

• Transitioning to electric arc furnaces
• Increasing energy efficiency
• Sourcing clean energy
• Securing and diversifying metallic inputs

XCarb®: Meeting Growing Demand for Low-Carbon Steel

ArcelorMittal is responding to customer demand through XCarb®, launched in March 2021 as the world’s first low-carbon steel initiative. The offering includes:

1. XCarb® Steel Certificates – These reflect carbon savings from investments in cleaner steelmaking processes, such as capturing and reusing coke-oven gas or reducing coal use with natural gas. Customers can report Scope 3 emissions reductions alongside their steel purchases.

2. XCarb® Recycled and Renewably Produced (RRP) Steel – Physical steel made in electric arc furnaces powered entirely by renewable electricity, using high levels of recycled steel.

Sales of XCarb® doubled from 0.2 million tonnes in 2023 to 0.4 million tonnes in 2024. However, this is still a small fraction of total shipments (54.3 million tonnes in 2024), and only a limited number of customers are willing to pay a green premium. Regulatory mandates will be vital to scale adoption.

Bright Spots: Where ArcelorMittal Produces Low-Carbon Steel

Despite setbacks, ArcelorMittal does operate some lower-emission facilities:

These facilities show what is possible, but they represent only a fraction of ArcelorMittal’s global production. Scaling such operations remains the real challenge.

Steel Emissions and the Decarbonization Challenge

Over 70% of global steel is still made using coal-based blast furnaces, the most carbon-intensive method. Electric arc furnaces, which rely on scrap and electricity, account for about 28% and emit far less. To meet a 1.5°C pathway, the IEA says steel emissions must fall 50% by 2050, with near-zero technologies deployed at scale by 2030. ArcelorMittal’s global footprint makes its pace of decarbonization critical for the sector.

ArcelorMittal stresses that the steel sector cannot decarbonize alone. Steel is a low-margin, globally traded commodity, and cleaner methods remain uncompetitive without government support.

• Europe’s 2025 focus includes the Clean Industrial Deal, Steel and Metals Action Plan, CBAM review, and safeguard review. These aim to promote low-carbon steel demand, close CBAM loopholes, and tackle high energy costs.

Yet the company warns policies are still insufficient to level the playing field. Hydrogen-based steelmaking and carbon capture remain central to its strategy, but meaningful scale won’t arrive before 2030. Current efforts rely heavily on subsidies and future breakthroughs rather than near-term transformation.

Will ArcelorMittal Lead or Lag in Steel’s Net-Zero Future?

The steel giant has highlighted that emissions reductions and green steel projects come mostly from reduced output, not innovation. As investments lag behind shareholder payouts, major projects are delayed, and Scope 3 emissions remain largely uncounted. Initiatives like XCarb® show potential, but success depends on policy support, energy management, and market demand.

The steel industry is significantly tough to decarbonize, but vital for a net-zero world. With 2030 targets increasingly challenging, ArcelorMittal has cut emissions almost in half since 2018—but will it commit to real transformation this decade? The answer remains lost in the haze.

• RELATED: ArcelorMittal Delays €1.7B Net Zero Plan: Is The EU Policy to Blame?

The post Steel’s Heavy Carbon Burden: Is ArcelorMittal Pulling Back on Its Net Zero Climate Pledge? appeared first on Carbon Credits.

Amazon (NASDAQ: AMZN) has announced a major renewable energy deal in the United States, partnering with Avangrid on a $100 million solar project. The development will add clean electricity to the U.S. grid and further support Amazon’s climate goals.

The agreement highlights the growing role of large corporations in driving clean energy demand. Amazon is one of the biggest buyers of renewable energy in the world. It is quickly growing its solar and wind portfolio.

Amazon signs long-term power purchase agreements (PPAs) to secure renewable electricity. This also helps developers like Avangrid get the funds they need to build large projects.

Net-Zero by 2040: Amazon’s Big Climate Goals, and Bigger Challenges

Amazon aims to reach net-zero carbon emissions by 2040. It also plans to run all operations on 100% renewable energy by 2025, a target it says it is close to achieving.

But Amazon’s emissions profile shows how hard this goal is. In 2024, the company’s total greenhouse gas emissions rose by 6%, reaching 68.25 million metric tons of CO₂ equivalent. That marked a reversal after years of reductions. All scopes saw increases.

Here is how the emissions break down: Despite the growth in absolute emissions, Amazon says it improved its carbon intensity (emissions per unit of business) by 4% in 2024.

Amazon explains its carbon footprint calculation using the GHG Protocol. It includes direct operations, energy use, and activities in the value chain. This covers product manufacturing, logistics, packaging, and more.

To reduce its impact, Amazon has taken multiple steps:

• Matching electricity use with renewable energy: In 2024, Amazon used 100% renewable energy for all its data centers and facilities.
• Investing in renewable capacity: As of early 2025, Amazon had invested in 621 renewable projects, amounting to 34 GW of carbon-free energy capacity.
• Storage and grid support: Amazon pairs solar projects with battery energy storage systems, enabling more stable renewable energy integration.
• Efficiency in data centers: Amazon’s AWS data centers reported a Power Usage Effectiveness (PUE) of 1.15, better than many industry averages.
• Innovation in cooling and design: New data center components launched in 2024 provided 12% more compute power. They also reduced peak cooling energy use by 46% without increasing water usage. 

These actions show the e-commerce giant is not just buying clean power, but trying to redesign how it uses energy.

SEE MORE on AMAZON:

• Amazon Flies Greener to Net Zero with 9M Liters of Sustainable Fuel from Neste
• Amazon to Power AI Data Center Expansion with 1,920 MW Nuclear PPA from Talen Energy

Avangrid’s Solar Play and Why It Matters

Avangrid, part of the Iberdrola Group, is one of the largest renewable energy companies in the United States. Its $100 million investment in the new solar project underlines the scale of capital required to expand America’s clean power supply.

The company currently operates more than 8.6 gigawatts (GW) of renewable capacity in the U.S., including wind and solar. By partnering with Amazon, Avangrid gets a steady buyer for its electricity. This deal also speeds up the growth of renewable infrastructure. This helps meet both state and national clean energy goals.

This project also illustrates how large tech and energy firms can work together. Amazon’s demand provides a stable revenue stream, and Avangrid gains the capital certainty to build more solar capacity. Over time, similar deals can help accelerate the transition of the U.S. power grid to cleaner sources.

Scaling renewable energy helps Amazon in two ways:

1. It reduces operational emissions (Scope 2) in regions where Amazon operates.
2. It supports grid decarbonization, which benefits all electricity users—including Amazon’s neighbors and future expansions.

How Corporate Demand Supercharges Renewable Growth

The deal comes at a time when renewable energy investment in the U.S. is accelerating. The International Energy Agency (IEA) reports that global clean energy investment hit $3.3 trillion in 2025. This amount surpassed spending on fossil fuels.

The U.S. remains a key market, with solar power installations alone expected to grow by more than 40 GW annually through 2030.

Corporations are an important driver of this trend. Companies now hold a larger share of renewable PPAs. This shift comes as investors, regulators, and consumers demand stronger climate commitments. Amazon has been the biggest buyer of renewable electricity worldwide since 2020.

Amazon’s deal with Avangrid sends a strong signal to the renewable sector. Corporate demand for clean power gives developers and financiers long-term certainty. This certainty helps make scaling projects easier. As more companies set science-based climate targets, the renewable PPA market is expected to keep expanding.

Industry forecasts say that corporate PPAs might make up 20–25% of new renewable capacity by 2030. Amazon’s scale gives it an outsized role in shaping this market. The company partners with developers like Avangrid. This helps unlock capital and speeds up the clean energy transition.

Amazon’s Hardest Climate Challenge

Amazon leads in renewable procurement, but it faces big challenges in hitting its 2040 net-zero target. The majority of its emissions come from Scope 3 sources, including suppliers, logistics, and product use by customers.

While renewable energy agreements cover operational electricity, tackling emissions across Amazon’s vast value chain will need deeper collaboration with partners and new technologies.

Analysts point out that Amazon’s total emissions haven’t dropped consistently. This shows the struggle between fast business growth and climate goals. For instance, even with renewable progress, Amazon’s overall footprint grew steadily during its years of fastest e-commerce expansion.

Balancing E-Commerce Expansion with Carbon Cuts

Amazon’s renewable energy strategy, like solar, is both a business and environmental decision. Access to low-cost clean power reduces long-term energy risks, while also positioning the company as a leader in climate action.

Partnerships with Avangrid and other developers boost the U.S. renewable energy market. They show that when companies demand clean energy, it can quicken the shift to clean electricity.

The U.S. renewable sector is set for strong growth in 2025, led by wind and storage, per S&P Global analysis. Wind power additions are projected at 15.7 GW, up 73% from 2024’s 9.1 GW. Energy storage is expected to triple, surging from 14.5 GW in 2024 to nearly 44 GW in 2025.

However, S&P Global cautions that some large wind and solar projects may face delays, with in-service dates potentially shifting beyond 2025. Overall, broad-based gains highlight accelerating momentum in the U.S. clean energy transition.

For Amazon, the challenge ahead lies in balancing growth with deeper emissions cuts. The Avangrid solar project represents progress, but a broader supply chain transformation will be needed to meet the 2040 net-zero target.

As more corporations follow Amazon’s lead, the renewable energy landscape in the U.S. is set for continued expansion. The success of these partnerships will help determine whether the country can meet its clean power goals and maintain momentum in the global shift away from fossil fuels.

• READ MORE: Amazon (AMZN) Stock Dips Despite Q2 2025 Beat: Cloud Growth Slows, Net-Zero Push Expands

The post Amazon (AMZN Stock) Strikes $100M Solar Deal with Iberdrola’s Avangrid to Power Its Net-Zero Future appeared first on Carbon Credits.

Costco Wholesale Corporation (NASDAQ:COST) closed its fiscal fourth quarter with results that highlight both its financial strength and long-term sustainability commitments. The retailer reported revenue and earnings that beat expectations, showing it remains strong in a tough retail market.

At the same time, Costco reinforced its ambition to reach net-zero emissions by 2050, with interim 2030 targets already in motion. For investors, earnings results and ESG updates provide two key insights. They show strong business performance now and outline a path for future environmental responsibility.

Strong Financials, But Mixed Investor Reaction

Costco reported its fiscal fourth quarter results after markets closed. Adjusted earnings per share came in at $5.87, beating the $5.80 forecast.

Revenue reached $86.2 billion, narrowly ahead of expectations. However, same-store (comparable) sales rose 5.7%, slightly below the anticipated 5.9%.

The company also revealed full-year sales of $269.9 billion, up 8.1% from $249.6 billion a year ago. Extended store hours implemented in summer added roughly 1% to weekly U.S. sales, according to the CEO — a modest but positive boost.

Investors were cautious, though, even with good results. They noted a small shortfall in comps and worried about margin pressure. Costco’s stock still dips despite better-than-expected results. 

Membership Muscle: Costco’s Secret Weapon

Costco’s strength lies in its membership model. The company ended the period with 81 million paid memberships, of which 38.7 million were executive tier. Renewals remain high, particularly in the U.S. and Canada.

Its limited product assortment and bulk sales model help streamline logistics and negotiating leverage with suppliers. Bulk buyers and value-seeking shoppers have kept foot traffic robust, even in tougher economic times.

Costco continues to expand overseas, focusing on markets like China and Spain. Its broad geographic reach—covering North America, Asia, and Europe—gives it scale and flexibility.

Greener Aisles: From Solar Roofs to Net-Zero Goals

Beyond financials and stock performance, Costco is advancing sustainability goals. The giant retailer has committed to net-zero greenhouse gas emissions by 2050.

To support that, it plans to reduce Scope 1 and Scope 2 emissions by 39% by 2030, using a 2020 baseline of approximately 2.6 million metric tons CO₂e. It also targets 100% renewable energy for operations by 2035.

Operational actions to reduce emissions include:

• Upgrading refrigeration systems and phasing down hydrofluorocarbons (HFCs)
• Switching to LED lighting and efficient HVAC systems
• Installing solar panels at warehouses and depots

Scope 3 emissions remain the greatest hurdle. Costco has proposed a 20% reduction in certain Scope 3 categories (excluding fuel) by 2030 vs. 2020. This relies heavily on supplier cooperation.

• SEE MORE: How To Reduce Scope 3 Emissions: Key Strategies That Work

Third-party analysts estimate that Costco’s total operational footprint, including indirect sources, is 4–4.7 million metric tons of CO₂e. Meanwhile, Costco’s latest climate action plan report shows mixed but notable progress in its emissions profile.

• Scope 1 emissions rose 1.3% between FY22 and FY23, though this increase was lower than the company’s overall growth in sales and store space.
• Scope 2 market-based emissions dropped 3%. This decrease was due to more electricity being bought from clean energy sources.
• Scope 3 emissions rose by 1%. This is much lower than the 7% rise in merchandising sales. It shows early signs of better efficiency in the supply chain.

On ESG scores, S&P Global assigns Costco an ESG score of 36 (out of industry peers), reflecting its public disclosures.

Sustainability initiatives also include sourcing certified seafood, fair-trade coffee, and timber. Costco is expanding waste diversion efforts, recycling, and sustainable procurement.

ESG Actions and Progress

Costco’s Climate Action Plan includes:

• Rooftop solar
• Off-grid solar for depots
• EV charging stations
• Efficiency upgrades

The company also runs sustainable sourcing programs for seafood, coffee, and timber. These measures aim to lower emissions, reduce waste, and meet consumer demand for responsibly produced goods.

Why ESG Progress Matters for Investors

Investors see sustainability as part of long-term risk management. Energy efficiency cuts costs, renewable energy reduces exposure to fuel volatility, and Scope 3 engagement limits supply-chain risks. While these initiatives require upfront spending, they can strengthen Costco’s margins over time.

Large investors increasingly prefer stock companies with measurable climate targets like Costco’s. Its emission goals, clean energy commitments, and supplier engagement help it align with these expectations and support brand trust with customers.

Retail Rivalries: ESG as the New Competition Ground

Costco’s earnings come at a time of shifting dynamics in global retail. Inflationary pressures have eased somewhat compared to the highs of 2022–2023, but cost-sensitive consumers continue to seek value.

Bulk retailers like Costco are benefiting from these trends. Households are focused on saving money on food, household goods, and fuel. At the same time, ESG expectations are rising. Retailers face scrutiny over product sourcing, supply chain transparency, and emissions targets.

Costco competes with Walmart, Target, and Sam’s Club. These rivals are also pushing climate strategies and setting interim net-zero goals.

Industry analysts expect the global retail sector to grow by 4–5% each year until 2030. This growth will come from population increases, urbanization, and the rise of digital channels. Sustainability is now a key factor in competition. More consumers prefer companies that show strong climate commitments.

Outlook for Investors

Investors will now watch for guidance in Costco’s next earnings cycle:

• How much margin pressure is expected (especially with extended store hours and energy costs)
• Capex plans (how much will go toward growth vs. ESG projects)
• Progress on emissions targets (updates on reductions or new milestones)
• Membership growth and renewal stability

Costco’s ability to deliver both strong financials and steady ESG progress will determine its appeal to both traditional stock and sustainability-focused investors.

Bottom Line: Growth Meets Green Ambitions

Costco’s fourth quarter results underline its ability to deliver steady growth in a shifting retail landscape. Membership strength and operational efficiency remain clear advantages. Meanwhile, the company is advancing on its climate roadmap, though Scope 3 reductions will be difficult to achieve.

With this achievement, Costco offers a strong option for investors. It’s a solid retailer with dependable earnings while also aiming to improve its ESG profile. This effort helps it compete in a market where financial success and sustainability are both important.

• READ MORE: Why Walmart Stock (WMT) Is at the Forefront of ESG Investing: Sustainability and Emissions Achievements in 2025

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