U.S. Department of Energy Announces $52.5 Million to Advance Carbon Dioxide Removal Technology

The U.S. Department of Energy’s (DOE) Office of Fossil Energy and Carbon Management (FECM) has taken a significant step forward in the fight against climate change by announcing a funding initiative of up to $52.5 million. This investment, made possible through President Biden’s Investing in America agenda, aims to propel the development and commercialization of carbon dioxide removal (CDR) technologies. These technologies are crucial for mitigating legacy carbon dioxide pollution, which remains in the atmosphere and contributes to global warming. By directly removing CO2 from the air, these technologies will help offset emissions from challenging sectors such as aviation and shipping.

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Carbon dioxide removal is essential to achieving the ambitious climate goals set by the Biden-Harris Administration. As part of this initiative, the American-Made Commercial Direct Air Capture Pilot Prize—funded by the Bipartisan Infrastructure Law—will support the creation of direct air capture (DAC) pilot projects. These projects are not just about technological advancement; they are about creating well-paying jobs, increasing private investment, and ensuring that communities hosting clean energy projects receive tangible benefits.

Brad Crabtree, Assistant Secretary of Fossil Energy and Carbon Management, emphasized the importance of scaling up these technologies, stating, “Achieving our ambitious climate goals requires the rapid scale-up of carbon dioxide removal technologies.” He further noted, “Today DOE is launching the Commercial Direct Air Capture Pilot Prize—the latest in a suite of programs that provide groundbreaking support to help de-risk and demonstrate commercial viability of direct air capture technology with the ultimate goal of industry deployment.”

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The Commercial Direct Air Capture Pilot Prize

The Commercial Direct Air Capture Pilot Prize is designed to support innovative technology developers who are working on direct air capture facilities. These facilities must be capable of capturing at least 500 tonnes of atmospheric CO2 per year. The prize will distribute up to $52.5 million across various phases of project development: Concept, Engineer, Permit, and Operate. Each winning team can earn up to $12 million for successfully completing these phases and operating a pilot DAC system for a minimum of 2,000 hours.

One of the key components of this prize is the opportunity for competitors to participate in the Regional Direct Air Capture Hubs program. This program, also funded by the Bipartisan Infrastructure Law, will establish four regional hubs across the United States. Each hub will demonstrate a DAC technology or a combination of technologies at a commercial scale, with the potential to capture at least 1 million tonnes of CO2 annually.

Eligible applicants for the Commercial Direct Air Capture Pilot Prize include private entities (both for-profit and non-profit), non-federal government entities such as states, counties, Tribes, and municipalities, as well as academic institutions. The first phase of the prize is currently accepting applications until February 7, 2025.

DOE’s Broader Efforts in Carbon Dioxide Removal

The American-Made Direct Air Capture Prizes, sponsored by FECM and administered by DOE’s National Renewable Energy Laboratory, play a critical role in advancing DAC technology. These prizes are part of a broader effort to decarbonize the economy, with a particular focus on environmental justice, community benefits planning and engagement, equity, and workforce development.

The Commercial Direct Air Capture Prize is one of several competitions under this initiative, which collectively offer up to $100 million in prizes and technical assistance. Another significant competition is the Carbon Dioxide Removal Purchase Pilot Prize, which was launched in September 2023. Recently, DOE announced 24 semifinalists who will receive a total of $1.2 million as part of the first phase of this prize.

In addition to these, the prize suite includes the Pre-Commercial Energy Program for Innovation Clusters Prize and the Pre-Commercial Technology Prize, both of which were launched in March 2023. These competitions are integral to the DOE’s strategy to transition carbon dioxide removal technologies from conceptual ideas to market-ready, scalable solutions.

For those interested in learning more about the Commercial Direct Air Capture Prize, the American-Made Challenges website provides detailed information. The site also offers updates on upcoming webinars and resources, which are available on the prize’s HeroX page.

The Road Ahead for Carbon Management

The FECM is committed to minimizing the environmental and climate impacts of fossil fuels and industrial processes while working towards net-zero emissions across the U.S. economy. The DOE’s focus includes areas such as carbon capture, carbon conversion, carbon dioxide removal, carbon dioxide transport and storage, hydrogen production with carbon management, methane emissions reduction, and critical minerals production. These efforts are crucial for not only reducing the carbon footprint but also for ensuring the sustainability of industrial processes.

As the DOE continues to drive innovation in carbon management, the partnerships and investments fostered by these prizes will play a vital role in shaping the future of clean energy. The Commercial Direct Air Capture Pilot Prize and related initiatives underscore the need for a collaborative approach, bringing together technology developers, academic institutions, government entities, and private sector stakeholders to tackle one of the most pressing challenges of our time—climate change.

For more information, you can visit the FECM website, sign up for news announcements, or explore the National Energy Technology Laboratory website to stay informed about the latest developments in carbon management technologies.