CO2 Utilisation 
in Australia: 
State of Play

December 2025



Citation and authorship

CSIRO (2025) CO2 Utilisation in Australia: State of Play. 
CSIRO, Canberra.

This report was authored by CSIRO Futures, including 
Dominic Banfield, Puja Paul, Erin McClure, Angus Grant, 
Doug Palfreyman, Kate McMahon, Sean Lim, Katherine 
Wynn, Vivek Srinivasan, Brook Reynolds.

CSIRO Futures

At CSIRO Futures we bring together science, technology 
and economics to help governments and businesses 
develop transformative strategies that tackle their 
biggest challenges. As the strategic and economic advisory 
arm of Australia’s national science agency, we are uniquely 
positioned to transform complexity into clarity, uncertainty 
into opportunity, and insights into action.

Acknowledgements

CSIRO acknowledges the Traditional Owners of the 
land, sea, and waters of the area that we live and work 
on across Australia. We acknowledge their continuing 
connection to their culture, and we pay our respects 
to their Elders past and present.

The authors are grateful to the experts who generously 
gave their time to provide input to this project through 
consultations, reviews and feedback as well as scientists 
and researchers from CSIRO. A full list of consulted 
organisations is available in Appendix A1. 

Disclosure statement

This project was partially funded by Project Partners 
that may have potential to benefit from this report. 
The Project Partners were consulted on the scope of the 
report, including the selection of assessed products, and 
provided feedback on draft assumptions and findings. 
CSIRO maintained full editorial control over the findings 
and content of this report. This report should not be 
taken as representing the views or policies of Project 
Partners or other individuals or organisations consulted. 
This report should not be taken as CSIRO endorsement of 
any organisations or of any projects being undertaken by, 
or products or services offered by, any organisations, 
including Project Partners. 

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Copyright

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Organisation 2025. To the extent permitted by law, all rights 
are reserved and no part of this publication covered by 
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Disclaimer

CSIRO advises that the information contained in this 
publication comprises general statements based 
on research. The reader is advised and needs to be 
aware that such information may be incomplete or 
unable to be used in any specific situation. No reliance 
or actions must therefore be made on that information 
without seeking prior expert professional, scientific and 
technical advice. To the extent permitted by law, CSIRO 
(including its employees and consultants) and the project 
Partners (including their employees and consultants) 
excludes all liability to any person for any consequences, 
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indirectly from using this publication (in part or in whole) 
and any information or material contained in it. 



Project partners 

This project was delivered by CSIRO Futures with financial 
and in-kind support from the following partners.



Contents

This report......................................................................................................................................................1Executive summary...................................................................................................................................2Glossary..........................................................................................................................................................51 Introduction...........................................................................................................................................62 State of play...........................................................................................................................................82.1 Industry.....................................................................................................................................................................82.2 Government............................................................................................................................................................102.3 Progress on CO2 Utilisation Roadmap themes.....................................................................................................142.4 Global context........................................................................................................................................................153 Market analysis...................................................................................................................................203.1 Methanol.................................................................................................................................................................253.2 Aviation fuel...........................................................................................................................................................323.3 Urea.........................................................................................................................................................................383.4 Mineral aggregates................................................................................................................................................443.5 Supplementary cementitious materials (SCMs)...................................................................................................493.6 Other products.......................................................................................................................................................554 Appendices..........................................................................................................................................59

This report

Carbon dioxide (CO2) utilisation technologies convert CO2 captured from industrial 
emissions and the atmosphere into useful products – like fuels, chemicals and materials. 
If successfully commercialised, they could help mitigate hard-to-abate emissions and 
enable a transition to low emission manufacturing in Australia. 

With a historic economic reliance on emissions‑intensive 
fossil fuel and mining exports, and abundant 
renewable resources, Australia has both a strong 
driver and an opportunity to be at the forefront of 
CO2 utilisation development. Recognising this, CSIRO’s 
CO2 Utilisation Roadmap (2021)1 explored the opportunities 
and challenges associated with the use of CO2 in Australia. 

Since the Roadmap’s release, domestic and global carbon 
emissions have continued to grow, increasing the need for 
decarbonisation solutions, including carbon management 
technologies, and the transition towards the use of 
low‑emission products. 

Against this backdrop, this report:

• Reviews the state of play (Section 2) in the CO2 
utilisation ecosystem with a focus on Australia’s 
industrial activity, policy and regulatory changes, and 
progress against the themes identified in the CSIRO 
CO2 Utilisation Roadmap since its release in 2021.
• Delivers market analysis (Section 3) that explores the 
industry development status and potential domestic 
market demand for a selection of CO2-derived products 
in 2050: methanol, aviation fuel, urea, mineral 
aggregates, and supplementary cementitious materials.


This report seeks to provide an overview of the current 
state of play of industry activity in CO2 utilisation globally 
and in Australia, and to assess the domestic opportunity 
and enabling factors that may be required to support 
further engagement and activity. 

CO2 sources and utilisation pathways in scope of this report

CO2 SOURCE

CO2 UTILISATION PATHWAYS IN SCOPE

Point Source Capture (PSC)
and flue gas CO2 from industry

CO2-derived products using CO2 captured from a point source (PSC) 
or the atmosphere (DAC) are the primary focus of this report.

Production costs for these products are estimated using updated CSIRO 
levelised cost of production (LCOP) models.

Direct Air Capture (DAC) CO2 
from the atmosphere

Biologically captured CO2 
from the atmosphere

Bio-products produced from the carbon contained in biomass or organic waste. 

Production costs for these products are estimated from literature.





1 Srinivasan V, Temminghoff M, Charnock S, Moisi A, Palfreyman D, Patel J, Hornung C, Hortle A (2021) CO2 Utilisation Roadmap. CSIRO. 



Executive summary

This report explores the state of play in 
Australia’s emerging CO2 utilisation industry 
and assesses the domestic market potential 
of several CO2-derived products in 2050.

CO₂ utilisation provides an opportunity to utilise CO₂ 
captured from industrial processes and the atmosphere 
to produce CO2-derived chemicals, fuels, and materials. 
Utilising captured CO2 can reduce the emissions intensity 
of these products compared to conventional production 
methods. Along with carbon capture and storage (CCS) 
and carbon dioxide removal (CDR), CO2 utilisation 
(also referred to as carbon capture and utilisation, or CCU) 
contributes to a holistic approach to carbon management.

State of play: Australia’s emerging 
CO2 utilisation industry 

Australia’s CO₂ utilisation industry has 
continued to develop with mineral carbonation 
projects operating at pilot and demonstration 
scale, and multiple e-methanol and 
bio‑e‑methanol projects under development. 

While no Australian CO2 utilisation projects have achieved 
full commercial-scale operations yet, there are important 
signs of progress. MCi Carbon’s Myrtle Demonstration Plant 
commenced operations in 2025, and HIF Global completed 
a pre-FEED study for an e-methanol plant in 2024. 
Bio‑e‑methanol projects planning to utilise biological 
sources of carbon and renewable hydrogen inputs are 
also in various stages of development in Tasmania and 
Victoria. Although many domestic projects are at early 
stage, this is relatively consistent with global developments, 
providing Australia with the opportunity to capture 
competitive‑advantage and capture demand. 

Australian federal and state governments 
continue to support the development of CO2 
utilisation technologies and projects through 
targeted funding mechanisms and investment 
in feasibility studies and pilots.

To accelerate the development of new carbon management 
technologies, the Australian Government continues to invest 
in CO2 utilisation projects through the Carbon Capture 
Technologies Program. The first round of this program 
invested approximately $41 million in CO2 utilisation projects, 
supporting three mineral carbonation projects and one 
methanol project. A further $52 million has been allocated 
for a second funding round, opening in 2026. 

At the state-level, CO2 utilisation policy and funding 
approaches are linked to each state and territory’s 
respective industrial strategy. Due to the high costs and 
risks associated with first-of-a-kind projects, government 
support has been a critical enabler of the CO₂ utilisation 
projects under development in Australia. 

Despite steady industry progress and 
government support, the deployment 
of commercial scale CO2 utilisation 
faces significant economic, technical, 
and system challenges.

The cost of carbon capture technologies – especially direct 
air capture (DAC) – continues to limit their deployment. 
Similarly, the high cost and limited availability of 
renewable hydrogen is limiting the cost competitiveness 
of CO2 utilisation pathways where hydrogen is a primary 
feedstock (e.g. methanol, aviation fuel, and urea). Due to 
these high costs, bio-production pathways for methanol 
and sustainable aviation fuel (SAF) show much greater 
potential for cost effectiveness. Some stakeholders also 
identified the lack of price signals that value CO2 emissions 
intensity reductions associated with recycling industrial 
CO2 into short-term stores of CO2 (e.g. fuels, fertilisers) as a 
constraint for CO2 utilisation industry development. 

Other products such as construction aggregates and 
supplementary cementitious materials (SCMs) show strong 
potential for cost-effectiveness. However, they may face 
technical challenges such as validating their technical 
performance for use in regulated and standardised 
construction industry applications.

Scaling up CO₂ utilisation to meet demand for bulk 
commodities requires alignment of many factors including 
CO₂ sources and other feedstocks, logistics, and supply 
chains to create commercially viable projects. For example, 
urea produced from industrial emissions shows strong 
potential for cost effectiveness by 2050 but will require a 
nearby and consistent CO₂ source, affordable and scalable 
low‑carbon hydrogen and ammonia production. Similarly, the 
opportunity for construction aggregate and SCM production 
is strengthened if supply chains are optimised through 
co‑located feedstock sources and end-users. Upstream and 
downstream partnerships – including bilateral partnerships 
with key trading partners – will likely be required to 
coordinate this and reduce risks for urea and mineral 
carbonate developers. 



Market analysis: opportunities 
and enabling conditions for 
CO2 utilisation

CO2 utilisation is a nascent industry opportunity that 
has potential to support decarbonisation of some of the 
hardest‑to-abate sectors in Australia in the long-term. 
This report estimates the potential domestic market demand 
for a selection of PSC and DAC CO2-derived and bio-products 
in the year 2050 by assessing their cost‑competitiveness 
against incumbent products in five markets: methanol, 
aviation fuel, urea, mineral aggregates, and SCMs. 

This analysis uses low and high decarbonisation 
ambition scenarios to explore the evolving carbon 
and industrial policy landscape and model a limited 
number of CO2‑derived products and production 
pathways in future domestic markets (see Appendix A.2 
for scenario details). It is conservative in its scope and 
assumptions and does not evaluate the potential impact 
of exports. As such, it may overestimate the potential costs 
and underestimate the addressable markets for CO2-derived 
products as the world transitions towards net-zero in 2050.

The overall market assessment results, and the 
cost‑competitiveness results are summarised in Table ES1 
and Table ES2, respectively. CO₂-derived products have 
the potential to cut emissions significantly by displacing 
conventional products at scale. As such, carbon abatement 
potential is assessed over the full life cycle by comparing their 
carbon intensity with incumbent products across projected 
market demand (see Appendix A.3–A.7 for calculation details).

Table ES1: Annual domestic demand, economic impacts, and CO2 abatement results for the cost-competitive CO2-derived 
and bio‑products in 2050 

CARBON 
SOURCE

PRODUCT

DOMESTIC 
DEMAND (Mtpa)

REVENUE
(AUD, billion)

JOBS
(FTE, ROUNDED)

CO2 ABATEMENT*
(Mtpa CO2)

Industry (PSC)

Urea

2.7

$1.6

1000

2.1

Industry 
(Flue gas)

Carbonated fine aggregate

2.1

$0.13

200

0.15

Carbonated (steel slag) SCM

0.15

$0.012

10

0.04

Biological

Bio-methanol

8.7

$6.9

5000

18.5

Bio-SAF (FT and HEFA+)

3.2–3.4

$5.2–5.6

3800–4000

10.8–11.3





* CO2 abatement is based on substitution of an incumbent product. 

+ Bio-SAF (HEFA) is only cost-competitive with conventional jet fuel in the high ambition scenario, as such the total demand for bio-SAF products 
is presented as a range representing the low and high ambition scenario results. 

Note: The economic impact and CO2 abatement potential were not calculated for products that did not capture demand. 

Table ES2: 2050 cost competitiveness of CO2-derived and bio-products under low and high ambition scenarios

MARKET

PRODUCT

COST COMPETITIVENESS

Low ambition

High ambition

Methanol

e-Methanol (PSC)

e-Methanol (DAC)

Bio-methanol

Aviation Fuel

e-SAF (PSC)

e-SAF (DAC)

Bio-SAF (HEFA)

Bio-SAF (FT)

Urea

Urea (PSC)

Urea (DAC)

Mineral aggregates

Concrete blend with carbonated 
fine aggregate

SCMs

Cement blend with carbonated SCM





LEGEND

PSC or DAC CO2-derived 
product (levelised cost 
of production modelled).

Bio-product (production 
cost estimated from 
literature).

Most cost-competitive 
product in market.

Cost-competitive 
compared to the 
incumbent product.

Not cost-competitive 
compared to the 
incumbent product.

Note: Direct Air Capture (DAC); Fischer–Tropsch (FT); Hydroprocessed Esters and Fatty Acids (HEFA); Point Source 
Capture (PSC); Supplementary Cementitious Material (SCM).



Urea produced from recycled industrial 
CO2 presents a strong $1.6 billion market 
opportunity in 2050.

The viability of producing urea from industrial emissions is 
dependent on the successful deployment of green ammonia 
projects, the establishment of CO2 PSC and distribution 
infrastructure, and the development of relevant carbon 
accounting methodologies. Hybrid urea production 
(incorporating green ammonia feedstocks into conventional 
urea production to reduce overall emissions intensity) 
may offer a transitional pathway to the use of industrial 
emissions and potentially DAC CO2. 

Carbonated fine aggregate and carbonated 
SCMs may present a near-term opportunity 
with potential for $142 million revenue in 2050.

These products have potential to support emissions 
reduction in the construction sector and recycle 
industrial waste streams. Modelling suggests that 
mineral carbonation-based products will approach cost 
competitiveness more quickly than other modelled 
products as they are not reliant on expected cost reductions 
in hydrogen inputs. These results suggest that carbonated 
waste products can compete in the market, however 
they are limited by the assumed supply of the modelled 
feedstocks (steelmaking slag and recycled concrete) 
in 2050. The size of this opportunity could be larger if 
scalable supplies of suitable feedstocks can be identified. 
Other feedstocks suitable for mineral carbonation, 
including serpentinite, are not considered in this report. 

Bio-methanol and bio-SAF products could 
generate $12 billion revenue and up to 
9000 jobs in 2050.

CO2-derived e-methanol and e-SAF remain relatively 
expensive in 2050 and capture no domestic market demand. 
However, e-methanol achieves cost competitiveness with 
conventional methanol and could be expected to capture 
demand if the supply of bio-methanol is constrained by 
feedstock availability, or the demand for low-emissions 
methanol increases further – due to green shipping 
demand, for example. In the aviation fuel market, the 
potential demand for bio-SAF products in 2050 exceeds 
assumed supply constraints. As such, conventional jet fuel 
paired with high-quality emissions offsets may continue 
to meet most of the aviation sector’s fuel demand in 
2050 unless policy or regulatory mandates drive uptake 
of e-SAF. A more rigorous analysis of future bio-feedstock 
availability and demand will be essential to understanding 
the potential role of both bio-fuels and CO2-derived fuels 
in the future.

The modelled CO2-derived products and 
bio‑products have potential to abate over 
31.6 Mtpa of CO2 emissions in 2050.

This analysis estimates that the production and use of 
CO2‑derived urea, mineral aggregate, and SCMs could abate 
almost 2.3 Mtpa of CO2 in 2050. The abatement potential 
of bio-methanol and bio-SAF products was estimated at be 
29.3 Mtpa (in the low ambition scenario). 

The high decarbonisation ambition scenario had a small 
impact on the relative cost-competitiveness and demand 
for the modelled products and, as such, the potential 
CO2 abatement. This subdued impact – an additional 
0.5 Mtpa CO2 abatement associated with the supply of 
bio-SAF (HEFA) – is due to market saturation in the urea 
and methanol markets occurring under the low ambition 
scenario, and supply constraints on the cost-competitive 
products in the other markets.

The economic and emissions abatement 
impact of CO2 utilisation technologies could 
be improved through low-cost feedstocks 
and technical process innovations.

The overall emissions abatement impact and market 
viability of CO2-derived products could be increased by 
securing supplies of low-cost CO2 feedstocks, increasing the 
supply of low-cost renewable hydrogen, developing more 
efficient CO2 utilisation processes, and implementing policy 
and regulatory support or drivers.

Improving the cost-competitiveness of DAC and the 
uptake of DAC capture carbon can enhance the abatement 
impact of CO2 derived products in the long-term. 
Even under the high decarbonisation ambition scenario, 
products derived from DAC CO2 feedstocks remain 
significantly more expensive than PSC CO2-derived and 
bioproduct alternatives. Further reductions in the cost of 
DAC could be enabled by driving down associated capital 
costs, improving operational efficiency and increasing 
the supply and affordability of renewable energy. 



Glossary

Term/acronym

ACCU

Australian Carbon Credit Unit: tradable units 
representing one tonne of carbon dioxide 
equivalent (CO₂-e) stored or avoided.

ATJ

Alcohol-to-Jet: a process for producing 
sustainable aviation fuel from alcohols.

bio-

(prefix) Denotes a product (e.g. bio-methanol, 
bio-SAF) produced from biological/organic 
feedstocks like biomass or waste.

Carbonated 
fine 
aggregate

A mineral aggregate product designed as a 
substitute for sand in concrete production 
produced from waste materials such as steel slag 
or concrete and CO2 in flue gas.

Carbonated 
SCM

A carbonated Supplementary Cementitious 
Material made from steel slag waste and CO2 
in flue gas. 

CAGR

Compound Annual Growth Rate

CCS

Carbon Capture and Storage: capturing CO₂ 
from point sources and storing it underground.

CCU

Carbon Capture and Utilisation: capturing CO₂ 
and using it to produce products.

CCUS

Carbon Capture, Utilisation and Storage: an 
umbrella term for CCS and CCU technologies.

CDR

Carbon Dioxide Removal: technologies that 
remove CO₂ from the atmosphere and store 
it permanently.

CJF

Conventional Jet Fuel: standard petroleum-based 
aviation fuel.

CO2 

Carbon Dioxide

CO₂ 
Utilisation

The use of captured carbon dioxide to 
create products. Also referred to as CCU. 

DAC

Direct Air Capture: technology that captures 
CO₂ directly from the atmosphere.

ETS

Emissions Trading Scheme 

e- 

(prefix) denotes a product that is produced 
using captured CO2 and renewable hydrogen 
feedstock produced using renewable electricity 
(e.g. e-fuels).

FEED

Front End Engineering and Design

FID

Final Investment Decision 

FT 

Fischer–Tropsch: a series of chemical 
reactions used to convert syngas (a mixture 
of carbon monoxide and hydrogen) into 
liquid hydrocarbons.

FTE

Full Time Equivalent (jobs)

GGBFS

Ground Granulated Blast Furnace Slag: 
a by‑product of steelmaking used as a 
supplementary cementitious material.

HEFA

Hydroprocessed Esters and Fatty Acids 
– a processing pathway used to produce 
sustainable aviation fuel by hydrogenating 
biological feedstocks (e.g. cooking oils, 
vegetable oils, and animal fats).

IMO

International Maritime Organisation – UN agency 
responsible for regulating shipping.

IRA

Inflation Reduction Act

LCA

Life Cycle Assessment – analysis of 
environmental impacts associated with 
all stages of a product’s life.

LCOP

Levelised Cost of Production – the average cost 
of producing a product over its lifetime.

e-methanol

e-methanol is a CO₂-derived product, 
produced from captured CO2 (PSC or DAC) 
and renewable hydrogen. 

Bio-methanol

bio-methanol relies on the gasification 
or combustion of biomass to generate a 
syngas intermediate.

Bio-e-
methanol

bio-e-methanol is a hybrid approach, where 
biomass-derived syngas is supplemented 
with renewable H2 to improve the conversion 
efficiency and yield.

MoU

Memorandum of Understanding 

MtCO₂

Million tonnes of carbon dioxide.

MtCO₂-e

Million tonnes of carbon dioxide equivalent – 
includes other greenhouse gases.

NOx

Nitrogen oxides 

OPC

Ordinary Portland Cement

pre-FEED

pre-Front End Engineering and Design

PSC

Point Source Capture of CO2 from 
industrial processes. 

PtL

Power-to-liquids

SAF

Sustainable aviation fuel – low-carbon 
alternatives to conventional jet fuel.

SCM

Supplementary Cementitious Material – materials 
used to partially replace cement in concrete.

SOx

Sulphur oxides 

Urea

Urea is a nitrogen-based fertiliser produced 
through the reaction of ammonia (NH3) with 
CO2 at high pressure. Conventionally, both the 
ammonia and CO2 are derived from natural gas 
feedstocks. This report models the production of 
low-carbon urea using PSC and DAC sources of 
CO2 combined with renewable ammonia.

Well-to-wheel 

Well-to-wheel (or well-to-wake) – refers to the 
emissions produced through the entire lifecycle 
of a product, including its production, transport 
and use.







1 Introduction

CO2 utilisation technologies convert 
CO2 captured from the atmosphere or 
industrial emissions into useful products 
– like fuels, chemicals and materials. 
If successfully commercialised, they could 
help mitigate hard‑to-abate emissions 
and enable a transition to low emission 
manufacturing in Australia. 

There are a range of industries that are difficult 
to decarbonise with renewable energy and 
electrification alone. These industries often rely on fossil 
fuel feedstocks to produce carbon-based products, like 
fuels and plastics. Others have emissions inherent in their 
processes, like steel and concrete production, or are reliant 
on energy dense fuels, like heavy transportation. 



CO₂ utilisation provides an opportunity to utilise CO₂ from 
industry and the atmosphere to produce chemicals, fuels, 
and materials with reduced emissions intensities compared 
to conventional products. Along with carbon capture and 
storage (CCS) and carbon dioxide removal removal (CDR), 
CO2 utilisation (commonly referred to as carbon capture 
and utilisation, or CCU) can support a holistic approach 
to carbon management and support decarbonisation of 
hard‑to-abate industries (See Box 1).

As both a major fossil fuel exporter and a country with 
abundant renewable energy resources, Australia has both 
a strong driver and an opportunity to be at the forefront 
of CO₂ utilisation development. Recognising this, CSIRO’s 
CO2 Utilisation Roadmap (2021)2 explored the opportunities 
and challenges associated with manufacturing CO₂-derived 
products in Australia. 

Since the Roadmap’s release, domestic and global carbon 
emissions have continued to grow, which is driving 
the acceleration of the deployment of decarbonisation 
solutions, including carbon management technologies, 
and the transition towards the use of low-emission products. 
Against this backdrop, it is timely to provide an 
update on Australia’s progress in this space to support 
decision makers in industry, government and research. 
This report:

• Reviews the state of play (Chapter 2) in the CO₂ 
utilisation ecosystem with a focus on Australia’s 
industrial activity, policy and regulatory changes, and 
progress against the themes identified in the CSIRO 
CO₂ Utilisation Roadmap since its release in 2021.
• Delivers new economic analysis (Chapter 3) assessing the 
potential market demand for a selection of CO2-derived 
products in 2050, including: methanol, aviation fuels, 
urea, cement and concrete. 


Box 1: Carbon Management3

Carbon management includes the following 
approaches to managing hard-to-abate emissions:

• Carbon Capture and Utilisation (CCU): 
CO2 captured from a point source or the 
atmosphere and used either directly or 
indirectly to form CO₂-derived products.
• Carbon Capture and Storage (CCS): CO2 captured 
from a point source and permanently stored.
• Carbon Dioxide Removal (CDR): CO2 captured 
from the atmosphere and stored permanently.


Figure 1: CO2 sources and utilisation pathways in scope of this report

CO2 SOURCE

CO2 UTILISATION PATHWAYS

Point Source Capture (PSC) and flue gas CO2 from industry

CO2-derived products using CO2 captured from a point source (PSC) 
or the atmosphere (DAC) are the primary focus of this report.

Direct Air Capture (DAC) CO2 from the atmosphere

Biologically captured CO2 from the atmosphere

Bio-products produced from the carbon contained in biomass 
or organic waste.





2 Srinivasan V, Temminghoff M, Charnock S, Moisi A, Palfreyman D, Patel J, Hornung C, Hortle A (2021) CO2 Utilisation Roadmap. CSIRO. 

3 Department of Climate Change, Energy, the Environment and Water (DCCEEW) (2025) Carbon Management for Tough Emissions. <https://www.dcceew.gov.
au/climate-change/emissions-reduction/carbon-management-technologies> (accessed 8 October 2025); European Commission (2024) Towards an ambitious 
Industrial Carbon Management for the EU. <https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=COM:2024:62:FIN> (accessed 8 October 2025). 



2 State of play

Australia’s CO₂ utilisation industry has 
been developing slowly between 2021 
to 2025, interspersed by important 
signals of momentum. 

This section provides an overview of Australian industry 
activity since 2021 (Section 2.1), relevant policy and 
regulatory changes (Section 2.2), Australia’s progress 
against industry development themes identified in CSIRO’s 
CO₂ Utilisation Roadmap (Section 2.3), and a high-level 
overview of relevant global activity (Section 2.4). 

2.1 Industry

Major Australian CO2 utilisation industry projects are 
mapped in Figure 2. While the environment has continued 
to develop, only two industry projects (MCi Carbon’s 
Myrtle Demonstration Plant, and Novalith’s Pilot Plant) 
are currently operational. 

Six other projects are conducting or have recently 
completed pre-Front End Engineering and Design 
(pre‑FEED) studies, with some progressing to FEED 
studies in 2025. Three of the eight identified projects 
relate to mineral carbonation, three relate to methanol 
production, and one relates to sustainable aviation fuel 
(SAF) production, which aligns with the relative cost 
competitiveness and projected market value of these 
products identified in the 2021 CO2 Utilisation Roadmap 
and the market viability results in Section 3. 



Figure 2: Snapshot of CO2 utilisation industry activity in Australia

Industrial projects

STATUS

IN DEVELOPMENT

OPERATIONAL

PRODUCT

Synthetic 
hydrocarbon 
chemicals & fuels

Building 
materials

Battery 
materials

South Australia Solar Fuels 
(Vast Renewables)

e-methanol production facility

FUNDING: Est. $90m total. $32m has 
been awarded under the under the 
German‑Australian HyGATE initiative, 
and $700k via the Singapore‑Australia 
ASLET initiative.

STATUS: Pre-FEED study 
complete. Vast Renewables
entered voluntary administration 
in November 2025.

Portland Renewable Fuels 
Project (HAMR Energy)

Bio-e-methanol production facility

FUNDING: $500k state funding via 
the Portland Diversification Fund 
for feasibility study support.

STATUS: Commenced FEED study. 
Targeting operation in 2027.

HIF Tasmania 
project (HIF Global)

e-methanol 
production facility

FUNDING: Est. US$1b at full scale.

STATUS: 
Pre‑FEED study complete. 
Targeting operation in 2030.

Project Ulysses 
(Jet Zero Australia)

Bio-SAF 
production facility

FUNDING: The $36.8m FEED study has 
received ARENA support and state funding, 
as well as private industry investment.

STATUS: Commenced FEED study.

Myrtle 
Demonstration 
Plant (MCi Carbon)

Mineral carbonate 
production facility

FUNDING: Received $14.6m and $14.5m in 
federal grants in 2021 and 2024 respectively, 
as well as global private investment in Japan 
and Europe.

STATUS: Commenced operation in 2025.

Novalith 
Pilot Plant

Lithium extraction 
and processing 
using CO2

FUNDING: $23m Series A funding raised 
to build Novalith’s pilot facility in NSW 
(2023), alongside a further $16m (2024) to 
accelerate commercialisation through scale up. 
~$10m secured through the federal CCTP. 
$1.5m received from NSW Government in 2025.

STATUS: Scaling process to commercial scale.

O.C.O Accelerated Carbonation 
Technology Facility at Maryvale 
Energy From Waste Plant 
(O.C.O Technology)

Mineral carbonate production 
facility using particulate matter 
and CO₂

FUNDING: Private investment. 
$16.3m facility.

STATUS: 
Early development 
work underway.
Targeting operation in 2029.

Bell Bay Powerfuels 
Project (ABEL Energy)

Bio-e-methanol 
production facility

FUNDING: The methanol production 
facility is estimated to cost $2b. 

STATUS: FEED study contracted. 
Targeting operation in 2029.

Note: Project list is non exhaustive. Only major projects at the pre-FEED stage (or further) have been noted. Feasibility studies are excluded for this reason.



Stakeholder consultations and desktop research 
identified the following industry trends:

• Government support remains a critical enabler of 
first-of-a-kind CO₂ utilisation projects in Australia. 
Progressing projects have seen funding models combine 
state and federal support with private capital and 
international partnerships. Grants and competitive loans 
through government programs (such as the Clean Energy 
Finance Corporation, Future Made in Australia, and 
Northern Australia Infrastructure Fund) continue to play 
a pivotal role in risk-management for novel projects. 
• Bilateral collaboration with key trading partners 
can strengthen strategic partnerships and reduce 
project risk. International funding (public and private) 
plays a critical role in enabling Australia’s CO2 
utilisation sector, aligning export ambitions with the 
decarbonisation strategies of major trading partners. 
For example, international partners continue to 
express interest in importing renewable hydrogen and 
its derivatives. Japanese gas companies (Osaka Gas, 
Toho Gas, and Tokyo Gas) are collaborating with Santos 
on e-methane;4 Japanese firms, such as ENEOS, have 
invested in Australia-based hydrogen production;5 and 
the German-Australia HyGATE initiative demonstrates 
the value of bilateral public funding. Japan and 
Australia also cooperate through the Joint Partnership 
on Decarbonisation through Technology, providing a 
foundation for collaborative public and private ventures.6 
Export positioning is further reinforced by maritime 
CO2 trade pilots, which are progressing globally.7
• Most CO₂-derived products remain significantly 
more expensive than conventional products. 
For hydrogen‑derived products, such as e-methanol 
and e-SAF, this is primarily driven by the high cost and 
limited availability of renewable hydrogen (and other 
low-emission hydrogen sources). The cost of carbon 
capture technologies – especially DAC – also contributes 
to overall costs and potentially limits deployment. 
Stakeholders indicated that most customers are not 
yet willing to pay a significant green premium for 
CO₂‑derived products, and the reduced emissions 
intensity that can be enabled through utilisation of 
industrial CO2 emissions in chemicals and fuels is 
not currently accounted for in government policy. 
This underscores the importance of accelerating cost 
reductions and exploring opportunities to reduce the 
green premium, enabling wider market adoption of 
CO₂‑derived products.
• Scaling up utilisation is capital-intensive and requires 
integration of many upstream and downstream factors. 
Securing and integrating cost-effective energy supply, 
CO₂ capture infrastructure, other feedstocks, and 
downstream customers will be critical to the success of 
commercially viable CCU pathways. These challenges 
create risks for developers, especially in the absence of 
long-term policy certainty and pricing signals


2.2 Government

Figure 3 provides a non-exhaustive timeline of major CO2 
utilisation related policy developments in Australia since 2021.

4 AusTrade (2024) Japanese utility giants to explore e-methane production in Australia. <https://international.austrade.gov.au/en/news-and-analysis/news/
japanese-utility-giants-to-explore-e-methane-production-in-australia> (accessed 8 October 2025).

5 AusTrade (2025) ENEOS invests A$200 million in Australian green hydrogen demonstration plant. <https://international.austrade.gov.au/en/news-and-
analysis/news/eneos-invests-200-million-in-Australian-green-hydrogen-demonstration-plant> (accessed 8 October 2025).

6 Department of Industry, Science and Resources (DISR) (2021) Japan-Australia partnership on decarbonisation through technology. <https://www.minister.
industry.gov.au/ministers/taylor/media-releases/japan-australia-partnership-decarbonisation-through-technology> (accessed 8 October 2025). 

7 Hakirevic Prevljak N (2025) K Line: New research project eyes development of onboard CCS. Offshore Energy. <https://www.offshore-energy.biz/k-line-new-
research-project-eyes-development-of-onboard-ccs/> (accessed 8 October 2025); Kawasaki Kisen Kaisha (2024) ‘K’ LINE enters into charter contracts with 
Northern Lights for third liquefied CO2 vessels. <https://www.kline.co.jp/en/news/liquefied_gas/liquefied_gas-20240206.html>; Petronas (2023) PETRONAS, 
MOL, and SDARI Acquire Four AiPs for LCO₂ Transportation. <https://www.petronas.com/media/media-releases/petronas-mol-and-sdari-acquire-four-aips-
lco2-transportation> (accessed 8 October 2025); TOKYO-Mitsui O.S.K. Lines (2024) MOL to Study Vessel Transport of Liquefied CO2 as Part of JOGMEC Call for 
‘Engineering Design Work for Advanced CCS Projects’. <https://www.mol.co.jp/en/pr/2024/24112.html> (accessed 8 October 2025).



Figure 3: Major Australian CO2 utilisation policy developments (2021–2025)

2021

CCUS Hubs and Technologies 
Program (est. 2021, discontinued) 

A two-stream program to support 
multi-user CCS hubs ($100m) and 
CCUS technologies ($150m).

Discontinued in 2022–23, with 
budget refocussed towards broader 
decarbonisation objectives.

CCUS Development fund (2021)

A $50m fund providing 
business grants up to $25m 
for pilot or pre‑commercial 
emissions reduction projects. 
Of the 6 projects awarded, 3 explicitly 
contained a utilisation aspect.

NT CCUS Middle Arm 
Precinct (2021)

The proposed CCUS Hub at 
the Middle Arm Precinct 
was announced and is 
currently under development. 
Two storage projects are at 
engineering stages, and an 
MoU for Australia’s first CO2 
import terminal was signed 
in 2024 (Royal Vopak).

CSIRO CO2 Utilisation 
Roadmap (2021)

The roadmap explores the risks 
and opportunities associated with 
the scale-up of carbon capture 
and utilisation (CCU) in Australia.

NSW Net Zero 
Industry and 
Innovation 
Investment Plan 
(2022)

A $360m initiative 
to support industrial 
emissions reduction, 
including via CCUS 
opportunities.

Australian Carbon Credit Unit (ACCU) 
Scheme reforms (2023–2028)

The ACCU system underwent review by an independent 
panel (2022) and by the CCA (2023). $66m is allocated 
to execute the reforms over 5 years. This includes the 
Safeguard Mechanism amendment (2023).

NT Opportunities for CO2 Utilisation 
in the NT (2023) CSIRO

CSIRO collaborates with industry and 
government to support business case 
development for the low emissions NT 
CCUS hub. This report was released as 
part of this work.

Diversify WA (2023)

CCUS identified as one of the pillars 
of the Diversify WA framework.

Safeguard 
Mechanism 
reform (2023)

The reforms apply a 
decline rate to facility 
baseline emissions 
so that they reduce 
gradually in line with 
Australia’s emissions 
reduction targets.

Carbon Capture 
Technologies Program, 
CCTP (2023)

A $65m fund targeting emerging 
technologies to capture and 
utilise CO2. Funded projects 
were announced in July 2024.

NSW Net Zero 
Future Act (2023)

The Act, passed Nov 
2023, establishes a 
framework within 
which CCUS could 
be considered in 
sectoral pathways.

WA CCUS Hubs 
Study (2023)

The study, undertaken 
by the Global CCS 
Institute and CSIRO, 
for the WA LNG 
Jobs Taskforce was 
released Nov 2023.

WA Petroleum Legislation Amendment Act (2024) 

The Act, assented in May 2024, provides a regulatory 
foundation for utilisation projects by enabling the 
transport and permanent storage of greenhouse gases.

QLD Great Artesian Basin GHG ban (2024)

QLD permanently bans GHG storage projects within 
the Great Artesian Basin in June 2024, which may 
promote regional utilisation projects.

QLD funding for utilisation 
projects (2024)

QLD announced new investments in 
SAF projects including a multi-seed 
crushing and processing facility at 
Yamala and funding for feasibility 
studies for Wagner and Liquid Power.

WA CCUS Action Plan (2024)

The plan, launched Nov 2024, outlines 
a vision to establish a CCUS industry 
in WA. $26m currently earmarked 
for CCS projects, funded through the 
Investment Attraction Fund (IAF).

WA Mineral Carbonation 
Roadmap released (2024)

The roadmap, delivered by 
the MRIWA, was launched 
in December 2024.

2025

Net Zero Plan and 
CCTP Round 2 (2025)

Australian Government 
announced updated 2035 
emissions target, a Net 
Zero Plan, and $52m CCTP 
funding to accelerate the 
development of new carbon 
management technologies.

FEDERAL

STATE AND TERRITORY



Federal Government

The Australian Government provides targeted support for 
CO2 utilisation and other carbon management technologies 
through the Carbon Capture Technologies Program which 
invested approximately $41 million in CO2 utilisation 
projects in its first round in 2024, including:8

• $15 million to Calix Ltd to support the construction of 
a renewably powered CCU demonstration plant that 
will supply CO2 for methanol production.
• $14.5 million to MCi Carbon to fund plant upgrades 
to the Myrtle facility to process a greater range of 
feedstocks to produce carbon embodied building 
and construction materials.
• $9.9 million to Novalith Technologies to demonstrate 
the production of battery-grade lithium carbonate 
from atmospheric CO2.
• $1.6 million to the University of Melbourne’s Carbon 
Trap Lab to trial the conversion of CO2 from DAC into 
travertine – a carbonated mineral suitable for use in 
building materials.


In 2025, $52 million was announced for a second 
funding round of the Carbon Capture Technologies 
Program to accelerate the development of new carbon 
management technologies.9

Previous support for CO2 utilisation was focused on 
hub-building. In 2021, the CCUS Development Fund was 
established to accelerate early-stage or pre-commercial 
Carbon Capture, Utilisation and Storage (CCUS) projects; 
six projects received one-off funding grants, three of which 
explicitly contained a utilisation component.10 In the same 
year, the $250m CCUS Hubs and Technologies Program 
was announced but was subsequently discontinued in the 
2022–23 Budget. The Australian Government announced 
a refocus of its CCUS strategy towards more targeted 
innovation programs, formally launching the Carbon Capture 
Technologies Program in 2023.11 This saw a pivot from 
multi-user hubs connected to CO2 storage sites, towards a 
redesigned program aimed at accelerating the integration 
of novel CO2 capture and utilisation technologies. 

No formal carbon crediting pathways for CO2 utilisation 
processes have been established in Australia.12 The lack 
of price signals that value the potential CO2 emissions 
intensity reductions associated with CO2 utilisation 
was identified by several stakeholders as a constraint 
on Australia’s CO2 utilisation industry development. 
However, there is a growing acknowledgement of the role 
of carbon management (CCU, CDR and CCS), including 
in the Australian Government’s Resources Sector Plan, 
Net Zero Plan and sectoral emissions plans,13 in addition to 
investment in CSIRO’s Carbon Dioxide Removal Roadmap.14

The Safeguard Mechanism, which sets legislated limits 
on emissions from Australia’s largest industrial facilities, 
was amended in 2023 to ensure facilities reduce emissions 
on a trajectory consistent with Australia’s emissions 
reduction targets.15 This included baseline limits declining 
by 4.9% annually to 2029–30. The National Greenhouse 
and Energy Reporting (NGER) Scheme is used to determine 
which facilities are covered by the Safeguard Mechanism. 
In the future, CO2 utilisation applications that store carbon 
in long lived products could potentially be deployed at 
relevant facilities to reduce emissions below the Safeguard 
Mechanism baseline and generate tradeable Safeguard 
Mechanism Credits. However, this would depend on how 
the captured and utilised CO2 emissions are treated under 
the NGER Scheme, and would require the development 
of new reporting methodologies for emerging 
utilisation technologies. 

Australian Carbon Credit Unit (ACCU) demand is expected 
to rise as facilities prepare to meet their future obligations 
under the Safeguard Mechanism. There are no approved 
ACCU methodologies for CO2 utilisation processes.16 
If CO2 utilisation methodologies are approved in the 
future, this may help improve revenue streams for 
relevant projects. In this scenario, facilities with co‑located 
CCU projects registered under the ACCU scheme (pending 
methodology approval) can generate ACCUs and 
sell credits. Alternatively, Safeguard facilities that exceed 
their baselines could purchase ACCUs from external CCU 
projects registered with the ACCU scheme (pending 
methodology approval) to achieve compliance.

8 Department of Climate Change, Energy, the Environment and Water (2024) Carbon Capture Technologies Program grant recipients announced. 
Media release. <https://www.dcceew.gov.au/about/news/carbon-capture-technologies-program-grant-recipients-announced#:~:text=Through%20the%20
Carbon%20Capture%20Technologies,carbon%20dioxide%20from%20the%20atmosphere> (accessed 8 October 2025).

9 Department of Climate Change, Energy, the Environment and Water (2025) Carbon management for hard-to-abate emissions. <https://www.dcceew.gov.au/
climate-change/emissions-reduction/carbon-management-technologies>.

10 Department of Industry, Science and Resources (DISR) (2021) $412 million of new investment in carbon capture projects. <https://www.minister.industry.gov.
au/ministers/taylor/media-releases/412-million-new-investment-carbon-capture-projects> (accessed 8 October 2025).

11 DCCEEW (2022) Meeting: APPEA CEO Samantha McCulloch. Meeting. <https://www.dcceew.gov.au/sites/default/files/documents/73531.pdf> 

12 DCCEEW (2025) Net Zero. <https://www.dcceew.gov.au/climate-change/emissions-reduction/net-zero> (accessed 8 October 2025).

13 DISR and DCCEEW (2025) Resources Sector Plan. <https://www.industry.gov.au/sites/default/files/2025-09/disr-resources-sector-plan.pdf>; DCCEEW (2025) 
Setting our 2035 target and path to net zero. <https://www.dcceew.gov.au/about/news/setting-2035-target-path-net-zero>.

14 CSIRO (2025) Australian Carbon Dioxide Removal Roadmap. CSIRO, Canberra.

15 Department of Climate Change, Energy, the Environment and Water (2025) Safeguard Mechanism. <https://www.dcceew.gov.au/climate-change/emissions-
reporting/national-greenhouse-energy-reporting-scheme/safeguard-mechanism>.

16 Department of Climate Change, Energy, the Environment and Water (2025) Method Development Tracker. <https://www.dcceew.gov.au/climate-change/
emissions-reduction/accu-scheme/assurance-committee/method-development-tracker> (accessed 8 October 2025).



Federal Government programs that support hydrogen 
production, green and advanced manufacturing, and 
industrial decarbonisation can also support CO2 utilisation. 
For example, a ten-year, $1.1 billion Cleaner Fuels Program 
was announced in September 2025. This program will 
support the development of low-carbon liquid fuels 
including SAFs and renewable diesel, where CO2 utilisation 
projects may be eligible.17 The Future Made in Australia 
program announced in the 2024–25 Budget also supports 
industries that can intersect with CO2 utilisation including 
renewable hydrogen, critical minerals processing, 
low carbon liquid fuels and clean energy manufacturing.18 
Meanwhile, the Guarantee of Origin scheme, which seeks 
to measure and certify the emissions intensity of various 
commodities, was established initially to monitor renewable 
electricity and hydrogen claims, and intends to expand 
to include low carbon liquid fuels and green metals.19 
Hydrogen Headstart (2023) supports scaling renewable 
hydrogen projects, which could directly intersect with 
e-fuels and synthetic products reliant on captured CO2. 
Although not targeted funding, the Australian Renewable 
Energy Agency (ARENA) can provide funding for CO2 
utilisation projects as part of relevant bioenergy, waste 
recovery and renewable energy projects.

State and Territory governments

State and Territory governments have implemented policies 
and regulations to support the deployment of CCU. At the 
state level, the WA Petroleum Legislation Amendment 
Act 2024 represents a regulatory blueprint enabling 
the transport and permanent storage of captured CO₂, 
providing a regulatory framework for utilisation by 
enabling the movement of CO2 feedstocks. WA Department 
of Mines, Petroleum and Exploration is also drafting 
regulations under the Petroleum Legislation Amendment 
Act 2024, designed to support the growth of a carbon 
service industry including CO2 utilisation technologies.20

State-level CO2 utilisation policy is linked to each state’s 
respective economic agenda. WA’s Diversify WA (2023) strategy 
explicitly specifies CCUS technology as a key opportunity of 
the state’s economic diversification framework linked to areas 
with global growth potential, with WA’s CCUS Action Plan 
(2024) outlining a vision and action areas to establish a CCUS 
industry in WA.21 Similarly, NSW’s Industry and Innovation 
Investment Plan (2022),22 while broader, has created a 
$360 million industry package in which CCU is recognised as 
a relevant pathway. Queensland has announced partnerships 
linked to SAF projects, aligning with broader low emissions 
strategies23 that seek to create regional jobs, stimulate 
innovation and reduce transport emissions, with major 
commitments from both the Commonwealth and Queensland 
governments.24 NT developments, including a Memorandum 
of Understanding (MoU) for a CO2 import terminal at Middle 
Arm Precinct signed in 2024, highlight opportunities tied to 
international CO2 trade and infrastructure. 

States also vary in their funding approaches to achieving 
these industrial ambitions. WA and the NT are actively 
building enabling environments, as seen through the 
establishment of CCUS-related legislation, action plans 
and hub precincts. NSW is positioning CCU as part of a 
wider net zero agenda but without standalone CCU policy. 
While Queensland is adopting a more restricted approach, 
selectively funding utilisation projects in which the state is 
competitively advantaged.

Beyond broad state-level action plans, several states have 
commissioned location and/or product specific roadmaps 
and studies. This includes WA’s Mineral Carbonation 
Roadmap (2024) which sets a structured pathway for scaling 
mineral carbonation, and WA’s CCUS Hubs Study (2023) 
which analyses the potential opportunity for CCUS hubs in 
the context of WA’s Liquid Natural Gas and manufacturing 
industries. The NT Opportunities for CO2 Utilisation study 
(2023) was prepared as one input into a broader investment 
case for a low emissions industry hub in the NT.

17 King M (2025) Fuelling the future: $1.1 billion to power cleaner Aussie fuel production. Media Release. <https://minister.infrastructure.gov.au/c-king/media-
release/fuelling-future-11-billion-power-cleaner-aussie-fuel-production> (accessed 8 October 2025). 

18 Australian Government (2024) A Future Made In Australia. <https://archive.budget.gov.au/2024-25/factsheets/download/factsheet-fmia.pdf> (accessed 8 
October 2025).

19 Department of Climate Change, Energy, the Environment and Water (2024) New Guarantee of Origin scheme to support low-emission industries. 
<https://www.dcceew.gov.au/about/news/new-guarantee-origin-scheme-support-low-emission-industries> (accessed 8 October 2025).

20 Western Australia Department of Mines, Petroleum and Exploration (DMPE) (2025) Draft Petroleum, Geothermal Energy and Greenhouse Gas Storage 
(Greenhouse Gas Injection and Storage) Regulations 2025. Fact Sheet. <https://www.wa.gov.au/government/publications/draft-petroleum-geothermal-
energy-and-greenhouse-gas-storage-greenhouse-gas-injection-and-storage-regulations-2025>. 

21 Western Australia Department of Energy and Economic Diversification (2024) Carbon capture utilisation and storage: Action Plan. <https://www.wa.gov.
au/government/publications/carbon-capture-utilisation-and-storage-action-plan>; Western Australia Department of Energy and Economic Diversification 
(2023) Future State: Accelerating Diversify WA. <https://www.wa.gov.au/government/document-collections/diversify-wa-resources-and-publications>.

22 New South Wales Office of Energy and Climate Change (2022) Investing in a low carbon future for NSW industry. <https://www.energy.nsw.gov.au/nsw-
plans-and-progress/government-strategies-and-frameworks/net-zero-industry-and-innovation-investment-plan>.

23 Queensland Government (2016) Biofutures 10-Year Roadmap and Action Plan <https://www.statedevelopment.qld.gov.au/__data/assets/pdf_
file/0017/13337/biofutures-10yr-roadmap-actionplan.pdf> (accessed 8 October 2025); Queensland Government (2023) Queensland New Industry 
Development Strategy. <https://statements.qld.gov.au/statements/97757> (accessed 8 October 2025); Queensland Government (n.d.) Industry Partnership 
Program. <https://www.statedevelopment.qld.gov.au/queensland-jobs-fund/industry-partnership-program> (accessed 8 October 2025).

24 State Development, Infrastructure and Planning (2024) Fuelling the future – Queensland’s sustainable aviation revolution. Queensland Government. 
<https://www.statedevelopment.qld.gov.au/news-and-events/fuelling-the-future-queenslands-sustainable-aviation-revolution> (accessed 8 October 2025); 
Department of Infrastructure, Transport, Regional Development, Communications, Sport and the Arts (2024) Albanese Government supports cleaner 
aviation with new emissions-reducing fuel projects. Media release. <https://minister.infrastructure.gov.au/c-king/media-release/albanese-government-
supports-cleaner-aviation-new-emissions-reducing-fuel-projects> (accessed 8 October 2025).



2.3 Progress on CO2 Utilisation Roadmap themes

Table 1 describes progress on the four themes identified in CSIRO’s CO₂ Utilisation Roadmap that could support the 
development and scale-up of CO₂ utilisation in Australia. Progress on each theme has been given a qualitative ranking 
(limited, emerging, or strong) based on the amount of relevant activity identified. While there are some strong examples 
of progress identified in Section 2.1 and 2.2, the progress on these enabling themes emphasises the relative nascency of 
CO2 utilisation in Australia. 

Table 1: Australian progress aligned with the CO₂ Utilisation Roadmap (2021) themes

THEME

PROGRESS

DETAILS

Diversify and engage 
across the value 
chain and multiple 
CCU applications

Emerging 
progress

• Demonstration activities in Australia have expanded into new sectors 
(i.e., construction materials and e-fuels), and progress and scale up is being 
tied to a diversity of end use markets.
• State-based strategies are tailored towards diverse regional innovation and industrial 
agendas, supported by targeted roadmaps and studies.
• The continuation of product-agnostic funding mechanisms like the Carbon Capture 
Technologies Program will support diverse CO2 utilisation projects.


Use CCU as part 
of a portfolio of 
decarbonisation 
solutions

Limited 
progress

• There is growing recognition of CO2 utilisation in climate policy and strategies for 
emissions reduction, with increased traction of portfolio-based carbon management 
approaches in federal and state strategies. 
• Deployment of CO2 utilisation in Australia is still nascent. CO2 utilisation projects remain 
at demonstration, pilot and project development stages, with no commercial scale 
projects reaching final investment decision at the time of writing.


Explore incentives 
and minimise 
barriers to entry

Emerging 
progress

• Federal funding mechanisms have been established, with targeted support from the 
Carbon Capture Technologies Program. Some state and territory government programs 
also support CO2 utilisation activities. 
• Bilateral funding partnerships demonstrate a growing appetite for government-led 
strategic cooperation that leverages diverse partner strengths.
• No carbon credit methodologies have been approved for CO2 utilisation.
• Scale-up is limited by a range of technical, economic, and system integration challenges, 
as well as progress delays in the scale-up of necessary precursors.
• Standardisation/regulatory frameworks are progressing, but further testing and 
demonstrations will be required for more novel products like carbonated SCMs.


Use CCU to 
support or de‑risk 
investment in 
existing and planned 
infrastructure

Limited 
progress

• The NT and WA have undertaken targeted CCUS hub exploration activities. However, 
the potential role of CO2 utilisation in the proposed hubs is still being explored. 
• Federal support for CO2 utilisation has seen a shift from hub-building to targeted 
technology innovation programs, most notably the Carbon Capture Technologies 
Program, which may have implications for the development of integrated 
infrastructure developments.








2.4 Global context

The global CCU industry has continued to develop 
since 2021,25 with commercial and demonstration scale 
facilities operating, under construction or proposed 
for many CO₂‑derived products (see Figure 4). 

Regional CCU approaches largely align with local industrial 
strengths and strategic priorities. Europe has emerged as 
an early leader, leveraging established industrial clusters 
and climate frameworks to incentivise demonstration and 
early commercial deployment. Across Asia, engagement 
is growing, often anchored in manufacturing and energy 
markets, while North American activity shows strong 
technological innovation despite policy uncertainty in the 
United States. Standards and mandates are increasingly 
shaping the adoption of CCU, highlighting the interplay 
between regional capabilities, policy ambitions and the 
influence of international regulatory frameworks. 

Globally, demand-side signals for CO2 utilisation have 
strengthened since 2021, with maritime, aviation, and 
construction sectors emerging as likely markets for 
CO₂‑derived products:

• Maritime fuel: In April 2025, the International Maritime 
Organisation (IMO) introduced draft measures, 
comprising a global fuel standard for ships and a 
pricing mechanism for maritime emissions, with formal 
adoption expected in October 2026 and entry into force 
in 2028.26 This marks the first step toward a global price 
signal for green shipping fuels, likely to accelerate uptake 
of low-carbon liquid fuels such as e-methanol.27
• Aviation fuel: Aviation policy has been most 
ambitious in Europe, embodied by the ReFuelEU 
Aviation regulation mandates (discussed below). 
These measures are complemented by the International 
Civil Aviation Organization (ICAO) global offsetting 
regime (Carbon Offsetting and Reduction Scheme for 
International Aviation (CORSIA)), which continues to 
create incremental demand for verifiable low‑carbon 
fuels; and through tax credit provisions for SAF 
production and CO2 utilisation that were extended 
and modified in 2025. 
• Construction materials: In the construction sector, 
demand drivers are emerging more gradually. 
In the US, Federal Buy Clean initiatives have begun to 
establish embodied-carbon requirements for concrete 
procurement, while in Europe, the Carbon Border 
Adjustment Mechanism, moving to full implementation 
in 2026, will place pressure on carbon-intensive materials 
such as cement and steel. Policy drivers within Europe 
include the RE2020 environmental regulations in 
France, which will take into account carbon emissions;28 
Denmark’s national carbon limits for new buildings, 
with its most recent limit taken effect from July 2025;29 
and mandatory life-cycle assessments to obtain building 
permit clearance in Sweden.30 


Figure 5 provides a non-exhaustive timeline of major global 
CCU-related policy developments since 2021. 

25 World Economic Forum (2025) Defossilizing Industry: Considerations for Scaling-up Carbon Capture and Utilization Pathways. <https://reports.weforum.org/
docs/WEF_Defossilizing_Industry_Scaling-up_CCU_2025.pdf>.

26 Environmental Defense Fund (2025) IMO postpones adoption of Net Zero Framework, delaying global action to decarbonize shipping. 
<https://www.edf.org/media/imo-postpones-adoption-net-zero-framework-delaying-global-action-decarbonize-shipping>.

27 International Maritime Organization (IMO) (2025) IMO approves net-zero regulations for global shipping. <https://www.imo.org/en/mediacentre/
pressbriefings/pages/imo-approves-netzero-regulations.aspx>.

28 Ministère de la Transition Écologique (2025) Réglementation environnementale RE2020. <https://www.ecologie.gouv.fr/politiques-publiques/
reglementation-environnementale-re2020>.

29 Buro Happold (2023) How Denmark leads the way in decarbonising the construction industry. <https://www.burohappold.com/news/how-denmark-leads-
the-way-in-decarbonising-the-construction-industry/>.

30 Nordic Council of Ministers (2023) Appendix: Building LCA and BIM Practices in Sweden. <https://pub.norden.org/us2023-463/appendix-building-lca-and-
bim-practices-in-sweden.html>.



Figure 4: Non-exhaustive overview of prominent commercial or near-commercial scale CO2 utilisation projects, globally

North America

9 major CCU projects announced 
from 2021 (up from 1 pre-2021)*

CarbonCure (Canada)

Carbon cured concrete

BluePlanet (US)

Mineral carbonation

CarbonBuilt (US)

Carbon cured concrete

Solidia (US)

Carbon cured concrete

Fairway Methanol JV 
Celanese and Mitsui (US)

Methanol production (PSC)

Europe

28 major CCU projects announced 
from 2021 (up from 9 pre-2021)*

Heidelberg Materials 
Górażdże plant (Poland)

Mineral carbonation (recycled concrete)

INERATEC (Germany)

e-SAF (FT)

Carbon8 Systems (UK)

Mineral carbonation

O.C.O 
Technologies(UK)

Mineral carbonation

Neustark (Switzerland)

Mineral carbonation 
(recycled concrete)

Asia and other regions

6 major CCU projects announced 
from 2021 (up from 2 pre-2021)*

Sumitomo Chemical (Japan)

e-Methanol production (CO2 from 
incineration of industrial waste)

ENEOS Corp (Japan)

e-fuel production

Shunli plant (China)

e-Methanol production (PSC)

Jiangsu Sailboat (China)

e-Methanol production (PSC)

Fertiglobe nitrogen 
fertiliser plant (UAE)

Urea production (PSC)

Saudi Basic Industries 
Corporation (Saudi Arabia)

Methanol/urea production (PSC)

*References carbon capture projects with a clearly identified source for the CO2 as per the IEA CCUS project database (2025). This does not include end-use utilisation projects, including some captured in this diagram.



Figure 5: Major CO2 utilisation policy developments, by global region

North 
America

2021

Nov 2021 (US)

US Infrastructure Investment 
& Jobs Act (IIJA) launches large 
DOE CCUS programs, creating 
major funding channels later 
used by utilisation projects.

2022 (Canada)

The CCUS Investment Tax Credit 
was introduced, with tax credit 
rates established for CCUS 
that permanently store CO2 
geologically or in concrete.

Aug 2022 (US)

US Inflation Reduction 
Act bolsters incentives 
by increasing tax 
credit rates for 
CO₂‑to‑products.

Dec 2022 (Canada)

$15b Canada Growth Fund 
established, investing 
in Canadian business/
projects that align with 
Canada’s climate targets.

2023–30 (Canada)

The Federal government 
made adjustments to federal 
carbon pricing mechanism, 
increasing the carbon price 
by $15/t per year to 2030.

May 2023 (US)

Clean Fuels 
& Products 
shot initiative 
launched.

Jan 2024 (US)

The Buy Clean Colorado Act 
(BCCA) mandates set limits 
on the GWP for concrete 
used in state construction 
projects over $500k.

April 2024 (US)

DOE allocates $310 million 
to Carbon Utilisation 
Procurement Grants to 
support the purchase and use 
of CO2-derived products.

Jun 2024 (US)

US DOE announces 
Tech‑to-Market 
support for carbon 
utilisation startups 
via OCED/ARPA-E.

Nov 2024 (US)

IRS Notice 2024–60 is 
issued, detailing rules 
for lifecycle analysis, 
registration to qualify 
CO₂-to-fuels/chemicals 
under the IRA.

Dec 2024 (US)

Treasury/DOE issues SAF 40B 
guidance (GREET), opening tax 
credits to e-SAF produced from 
captured CO₂ when criteria met.

2025

March 2025 (US)

Under new administration, there has 
been uncertainty and significant pause 
in the disbursement of funds under the 
IRA and initiated reviews and potential 
rollbacks of clean energy grants (incl. 
CO2 utilisation procurement grants).

Today

Europe

2021

2022 (EU)

EU Innovation Fund, backed 
by the Emission Trading 
Scheme, is established. 
Several CCU projects funded, 
incl. e-methanol and e-fuel.

July 2022 (UK)

UK Advanced Fuels Fund 
established, awarding grants 
to UK SAF project with 
>65% abatement potential. 
Latest round awarded July 2025.

2023 (EU)

Revisions of the REDII (to REDIII) 
under fit-fo-55 package extend 
the scope of the database to 
include recycled carbon fuels 
and e-fuels via CCU.

Jul 2023 (EU)

EU adopts RFNBO Delegated 
Acts, governing the conditions 
for renewable hydrogen and 
downstream e-fuels from CO2.

Sept 2023 (EU)

FuelEU Maritime and ReFUelEU 
Aviation commences, creating 
demand for lower emission 
marine fuels and SAF to 
meet targets.

2025

2025 (UK)

UK SAF Mandate started in 
2025 start, creating binding 
demands for SAF incl. PtL 
routes using captured CO₂.

March 2025 (EU)

Implementing regulation for 
the Carbon Boarder Adjustment 
Mechanism (CBAM) is adopted. 
The definitive regime will take 
place from 2026.

Today

Asia and 
other regions

2021

2021 (Japan)

Japan’s Green Innovation Fund 
was est. 2021. ¥38.23b allocated 
towards carbon capture 
technologies that could support 
downstream utilisation.

2023 (India)

India’s National Green 
Hydrogen Mission budget & 
guidelines (launched 2023) 
incentivises production of 
H2 and CO₂ derivatives.

2023–25 (Japan)

The Green Transformation (GX) policy was established 
in 2023 to invest in public and private decarbonisation. 
The subsequent ‘Low-Carbon Hydrogen & Derivatives Act’ 
and ‘CO₂ Storage Businesses Act’ (both 2024), explicitly 
enable CO₂-derived fuels. The GX-Emissions Trading Scheme 
began voluntarily in 2023 and will become mandatory in 2026.

Jun 2023 (India)

Release of CCUS 
Policy Framework 
& Roadmap.

Jan 2024 (China)

National Voluntary 
Carbon Market 
(CCER) trading 
relaunch, after seven 
years on pause.

Feb 2024 (Sth Korea)

CCUS Act declared, 
with ongoing legislative 
efforts occurring 
over 2024–25.

July 2024 (India)

The Carbon Credit Training 
Scheme framework notified in 
2023, with detailed compliance 
regulations adopted July 2024.

2025

Today



North America

In North America, the trajectory of CCU policy has been 
defined by strong incentives, and more recently, political 
uncertainty from the United States.

In the United States, the Infrastructure Investment 
and Jobs Act 2021 opened major funding streams for 
large‑scale CCUS programs, including those later applied 
to utilisation projects.31 The IRA added technology-specific 
credits, covering: CO₂ capture and CO₂ utilisation; SAF 
production; and clean fuel production.32 These provisions, 
alongside the introduction of a clean hydrogen credit, 
have directly and indirectly improved the economics of 
CO2‑derived fuels such as e-methanol and e-SAF. Pauses and 
reviews of IRA funding and Department of Energy grants33 
through the enactment of the One Big Beautiful Bill Act in 
early 2025 created some uncertainty for project proponents. 
However, the Section 45Q Tax Credit that provides tax 
credits for carbon management projects was retained and 
the credit values for CO2 captured and utilised from industry 
and power sources were increased.34

In Canada, the CCUS Investment Tax Credit (introduced 
2022) provides offsets for capture, transport and storage 
infrastructure, including utilisation in concrete.35 In 2023, 
the Canadian government also announced adjustments 
to its carbon pricing mechanism, increasing the carbon 
price by $15/tCO2 per year to 2030.36 This marks an increase 
from CAD$80/tCO2 (April 2024) to CAD$170/tCO2 in 2030. 
This combined with provincial clean fuel standards in 
Canada may create a supportive environment for CCU.

Europe 

Progress in Europe since 2021 has been shaped by binding 
demand mandates, reforms to carbon pricing and explicit 
recognition of CCU in long-term climate planning, with 
the European Commission’s proposed 2040 climate 
target (released July 2025), explicitly identifying CCU 
as a potential contributor.

The European Union (EU) has put in place several 
demand‑side policies, enabling CCU markets:

• The ReFuelEU Aviation regulation, implemented from 
2024, mandates an increase in SAF share from 2% in 2025 
to 70% by 2050, including a sub-target for synthetic fuels 
(1.2% of aviation fuel content by 2030, increasing to 35% 
by 2050).37
• The FuelEU Maritime regulation requires progressive 
reductions in the emissions intensity of marine fuels, 
decreasing by 2% in 2025 to 80% in 2050 from a 
2020 baseline.38 
• The updated Renewable Energy Directive (RED III) 
introduces mandatory use of renewable fuels of 
non‑biological origin, creating a binding market 
for e-fuels.


At the same time, reforms to the EU Emissions 
Trading Scheme (ETS) have extended recognition to 
‘permanent CCU,’ with emissions bound into durable 
products such as carbonated aggregates and concrete 
exempted from ETS. However, certification processes 
for such products are not yet formalised at the EU‑level. 
Together, these measures offer both supply- and 
demand‑side support for CCU deployment in fuels 
and materials. 

In the United Kingdom (UK), by contrast, policies have 
primarily focused on carbon capture and storage projects, 
rather than utilisation.39 However, a SAF mandate was 
introduced at the start of 2025, and the existence of 
landfill taxes has seen the advent of several start-ups 
pursuing the development of novel construction materials 
such as aggregates. The UK has also established a Green 
Building Council that has articulated a target to achieve 
a net‑zero‑carbon built environment by 2050. This could 
increase demand for low-emission construction materials, 
such as CO2-derived products.40

31 U.S. Department of Energy (2021) FECM Infrastructure Factsheet. <https://www.energy.gov/sites/default/files/2021-12/FECM%20Infrastructure%20Factsheet.pdf>.

32 Internal Revenue Service (2025) Inflation Reduction Act of 2022. United States Department of the Treasury, Washington, DC. <https://www.irs.gov/inflation-
reduction-act-of-2022>.

33 The White House (2025) Unleashing American Energy. <https://www.whitehouse.gov/presidential-actions/2025/01/unleashing-american-energy/>.

34 Carbon Capture Coalition (2025) Senate Finance Committee preserves 45Q, but value of credit will continue to erode until 2028. 
<https://carboncapturecoalition.org/senate-finance-committee-preserves-45q-but-value-of-credit-will-continue-to-erode-until-2028/>.

35 Natural Resources Canada (2023) Canada’s Carbon Management Strategy. Government of Canada, Ottawa. <https://natural-resources.canada.ca/energy-
sources/carbon-management/canada-s-carbon-management-strategy>.

36 Department of Finance Canada (2025) Removing the consumer carbon price, effective April 1, 2025. Government of Canada, Ottawa. 
<https://www.canada.ca/en/department-finance/news/2025/03/removing-the-consumer-carbon-price-effective-april-1-2025.html>.

37 European Commission (2025) ReFuelEU Aviation. Directorate-General for Mobility and Transport, Brussels. <https://transport.ec.europa.eu/transport-modes/
air/environment/refueleu-aviation_en>.

38 European Commission (2025) Decarbonising maritime transport – FuelEU Maritime. <https://transport.ec.europa.eu/transport-modes/maritime/
decarbonising-maritime-transport-fueleu-maritime_en>.

39 Oil and Gas Climate Initiative (OGCI) (2024) Carbon capture and utilization as a decarbonization lever. <https://www.ogci.com/wp-content/
uploads/2024/05/CCU-Report-vf.pdf>.

40 UK Green Building Council (2021) Whole Life Carbon Roadmap: A Pathway to Net Zero. <https://ukgbc.org/wp-content/uploads/2021/11/UKGBC-Whole-Life-
Carbon-Roadmap-A-Pathway-to-Net-Zero.pdf>.



Asia and other regions

Across Oceania, Asia and the Middle East, policy approaches 
are at various stages of development. Even where 
explicit policy may be limited, CCU developments appear 
where conditions are favourable, such as access to 
renewable energy zones and/or proximity to industrial 
point source emissions. Across these regions, industry 
development is primarily concentrated in chemicals and 
fuels manufacturing.

In China, the national voluntary carbon market relaunched 
in January 2024 after a seven-year pause, reinstating an 
avenue for crediting CCU projects. China remains the 
world’s dominant methanol producer. Though most 
production is fossil-based, the world’s two largest 
commercial-scale CO₂-derived e-methanol plants are both 
located in China (Shunli & Sailboat) using carbon recycled 
from co-located industrial processes. In October 2024, 
Carbon Recycling International announced plans for a 
third plant (Tianying) in Liaoyuan.41 

In Japan, the Green Transformation-Emissions Trading 
System, began as a voluntary scheme in 2023–24, and 
will become a mandatory compliance-based system 
for 300–400 major firms from mid-2026. Japan also 
passed legislation in 2023–24 enabling CO₂ storage and 
low‑carbon hydrogen derivatives, supported by a national 
CCS roadmap. As Japan has limited geological CCS capacity, 
it is expected that export or utilisation of CO₂ will feature 
in Japan’s carbon management strategies.42 

In India, the release of a CCUS policy framework in June 
2023 and subsequent launch of the Carbon Credit Trading 
Scheme in July 2024 established foundations for a domestic 
carbon market. At the same time, India’s National Green 
Hydrogen Mission is incentivising hydrogen and derivative 
production, which could indirectly enable CO₂-based fuels 
and chemicals production.

Across some Middle Eastern and South American countries, 
industries are pursuing e-fuels and CCU chemicals projects 
to leverage abundant low-cost renewables and co-located 
industrial emissions, often in an export-oriented context. 
Potential for growth in renewable hydrogen production 
could also position some countries to produce CO2‑derived 
chemicals and fuels products.43 The HIF Global Haru Oni 
e-fuel plant in Chile was completed in 2022 and has 
achieved production of 130,000 litres/year e-Gasoline 
in 2023.44 This plant uses CO2 captured from a brewery to 
produce e-methanol which is converted to e-gasoline for 
export to Europe. HIF is currently developing an e-methanol 
project in Tasmania (see Section 3.1). Across these regions, 
CCU activity is concentrated in fuels and chemicals, 
reflecting both comparative advantages and the global 
demand pull emerging from shipping and aviation.

41 Carbon Recycling International (2025) Projects. <https://carbonrecycling.com/projects>.

42 James W (2025) Japan is betting big on exporting carbon emissions. Climate and Capital Media, 1 August. <https://www.climateandcapitalmedia.com/japan-
is-betting-big-on-exporting-carbon-emissions/>.

43 OGCI (Oil and Gas Climate Initiative) (2024) Carbon capture and utilization as a decarbonization lever. OGCI, London, UK. <https://www.ogci.com/wp-
content/uploads/2024/05/CCU-Report-vf.pdf>.

44 HIF Global (n.d.) HIF Haru Oni. <https://hifglobal.com/locations/hif-haru-oni>.



3 Market analysis

This report estimates the potential 
market demand for a range of 
CO₂‑derived products and bio-products 
(e.g. bio‑fuels) in the year 2050 by 
assessing their cost competitiveness 
against incumbent products. 

This analysis uses low and high decarbonisation ambition 
scenarios to explore the evolving carbon and industrial 
policy landscape and the role of low-emissions technologies 
in future markets. This section presents the industry status 
and domestic market assessment results for five product 
markets: methanol (Section 3.1), aviation fuel (Section 3.2), 
urea (Section 3.3), mineral aggregates (Section 3.4), and 
SCMs (Section 3.5). 



Table 2 shows the cost competitiveness of CO2-derived products and bio-products against the incumbent (or conventional) 
products. In the high ambition scenario, six CO2-derived products and three bio-products become competitive with 
the incumbent product. In the low ambition scenario, only four CO2-derived products and two bio-products are cost 
competitive with the incumbent product. When considering only production cost with no decarbonisation ambition at all, 
the results still show potential for three CO2-derived products and one bio-product to reach cost competitiveness by 2050.

Table 2: 2050 cost competitiveness results for CO2-derived products and bio-products under low and high ambition scenarios

MARKET

PRODUCT

2050 COST COMPETITIVENESS
(Relative to incumbent product)

LCOP

LOW 
AMBITION

HIGH 
AMBITION

Methanol

e-methanol (PSC)

16%

-5%

-29%

e-methanol (DAC)

74%

27%

-23%

Bio-methanol

-5%

-29%

-54%

Aviation Fuel

e-SAF (PSC)

125%

80%

32%

e-SAF (DAC)

240%

149%

51%

Bio-SAF (HEFA)

45%

15%

-18%

Bio-SAF (FT)

24%

-8%

-43%

Urea

Urea (PSC)

-1%

-15%

-33%

Urea (DAC)

48%

17%

-22%

Concrete (Mineral aggregate/sand)

Concrete blend with carbonated fine aggregate

-11%

-10%

-9%

Cement (SCMs)

Cement blend with carbonated (steel slag) SCM 

-13%

-14%

-15%





LEGEND

COST DISADVANTAGE

 COST ADVANTAGE

> 25%

10–25%

< 10%

< 10%

10–25%

> 25%





Note: Direct Air Capture (DAC); Fischer–Tropsch (FT); Hydroprocessed Esters and Fatty Acids (HEFA); Point Source Capture (PSC); Supplementary Cementitious 
Material (SCM)



Table 3 shows the modelled demand, economic impacts, 
and CO2 utilisation for the three CO2-derived products and 
two bio-products that capture demand in 2050 – urea (PSC), 
carbonated fine aggregate, carbonated SCM, bio‑methanol 
and bio-SAF (FT and HEFA). E-methanol products do not 
capture demand (despite being cost competitive with 
conventional methanol under at least one scenario) as 
bio‑methanol is the most competitive product in the 2050 
market for methanol.

Despite having a significant impact on the cost 
competitiveness of some CO2-derived products, the low 
and high ambition scenarios returned identical demand 
results for the CO2-derived products found to be viable. 
For urea, this is because urea (PSC) is the most cost 
competitive product in both scenarios. For the mineral 
aggregates and SCMs, this is because the modelled 
demand for the product exceeds supply side constraints 
in both scenarios.

Table 3: Annual domestic demand, economic impacts, and CO2 abatement results for CO2-derived products and bio-products in 2050

CARBON 
SOURCE

PRODUCT

DOMESTIC 
DEMAND (Mtpa)

REVENUE
(AUD, billion)

JOBS
(FTE, ROUNDED)

CO2 ABATEMENT*
(Mtpa CO2)

Industry (PSC)

Urea

2.7

$1.6

1000

2.1

Industry
(Flue gas)

Carbonated fine aggregate

2.1

$0.13

200

0.15

Carbonated (steel slag) SCM

0.15

$0.012

10

0.04

Biological

Bio-methanol

8.7

$6.9

5000

18.5

Bio-SAF (FT and HEFA+)

3.2–3.4

$5.2–5.6

3800–4100

10.8–11.3





* CO2 abatement is based on substitution of an incumbent product. 

+ Bio-SAF (HEFA) is only cost-competitive with conventional jet fuel in the high ambition scenario, as such the total demand for bio-SAF products 
is presented as a range representing the low and high ambition scenario results. 

This report analyses a limited selection of products 
chosen in discussion with the project partners. 
As these represent only a small selection of CO2 
utilisation applications, this report does not describe 
the full potential of CO2 utilisation. The emerging 
CO2-derived products described in Section 3.6 could 
increase the economic and environmental benefits of 
CO2 utilisation for Australia.



Analysis approach

At a high-level, this methodology consisted of 3 stages (Figure 6). While each of these stages presented a series 
of detailed calculations and economic approaches (described in more detail in Appendices A.2–A.7), for each 
CO2-derived product the approach involved:

Figure 6: High-level overview of market assessment approach

1

Estimate production 
and CO2 emission 
costs in 2050

• Calculate levelised cost 
of production for each 
CO2‑derived product.
• Estimate production costs 
for bio-products and 
conventional products 
from market research 
and literature. 
• Estimate CO2 emission 
costs under low and 
high decarbonisation 
ambition scenarios. 


2

Model domestic 
demand and 
market share 
in 2050

• Estimate total domestic 
market using market 
research data. 
• Allocate market share 
using a market clearing 
assessment and relevant 
supply constraints. 


3

Estimate potential 
economic benefits, 
CO2 utilisation 
and abatement

• Estimate domestic revenue 
and job potential using 
industry benchmarks 
for CO2‑derived and 
bio-products with 
market share.
• Calculate CO2 utilisation 
volume (feedstock 
requirement) for 
CO2‑derived products 
with market share.
• Calculate CO2 abatement 
potential for CO2-derived 
and bio-products with 
market share.




1. Estimate production and 
CO2 emissions costs in 2050

Production costs are estimated for the CO₂-derived 
products and benchmarked against conventional 
counterparts in each product category, with 
biomass‑derived alternatives included where relevant. 
These production costs are projected to 2050, 
incorporating a baseline scenario and two carbon price 
pathways (one low and one high). To apply these carbon 
prices, well-to‑wheel carbon intensities are estimated 
for each product.45 Assumptions are derived from 
existing CSIRO analysis, literature, and industry insights. 
For bio‑products and conventional products, production 
cost estimates are derived from literature or market price 
data. Where necessary, profit margins are removed from 
market prices to estimate production costs. 

To explore different decarbonisation ambition scenarios, 
two distinct CO2 emission cost assumptions are modelled 
for 2050. In each scenario, a CO2 emission cost is assigned 
for each tonne of CO2 emitted during the production and 
use of each product. Well-to-wheel carbon intensities are 
estimated for each product and multiplied by the shadow 
carbon price to calculate the emissions cost component 
of production. This cost is added to the levelised cost of 
production (LCOP), improving the relative competitiveness 
of products that emit less CO2, and reducing the 
competitiveness of products that emit more CO2. 

The scenarios and their CO2 emission costs are defined 
as follows: 

• The low ambition scenario assumes CO2 emission costs 
rise gradually to $125/t in 205046, reflecting limited 
uptake of abatement technologies and fragmented 
climate action.
• The high ambition scenario assumes CO2 emission 
costs rise more sharply (to $425/t in 205047), reflecting 
emissions reductions and accelerating demand for 
low‑emissions products. This scenario is broadly 
consistent with the level of ambition required to 
achieve net zero by 2050.


The CO2 emission costs applied in this scenario-based 
approach are shadow carbon prices, which reflect the 
combined effect of all policies, regulations, and incentives 
that affect relative product costs of CO2 emitting products. 
This is a standard method for assessing low-emissions 
technologies and does not imply the adoption of a carbon 
pricing policy. Rather, it provides a structured framework to 
explore how different policy and market signals may shape 
future demand for CO₂-derived products.

General assumptions, including input costs for the LCOP 
models for the CO2-deriverd products, can be found 
in Appendix A.2. Broadly these assumptions align with 
previous CSIRO analysis and modelling.

2. Model domestic demand 
and market share in 2050

Given the commodity nature and price inelasticity of the 
products modelled in this report, the market demand is 
allocated using a market clearing assessment which assumes 
that demand is captured by the lowest-cost product. 
The total market size is estimated by projecting current 
demand volumes out to 2050. Where relevant, constraints 
on production capacity and feedstock availability 
are applied to the lowest cost products, with excess 
demand redistributed to the next cheapest products. 
These constraints, where relevant, are aligned with existing 
CSIRO assumptions, including the SAF roadmap.

3. Estimate potential economic 
benefits, CO2 utilisation requirements, 
and abatement potential

Assuming that all domestic demand is met from domestic 
supply, revenue estimates for all CO2-derived products 
and bio-products that capture market share, are calculated 
by multiplying each product’s volume by its estimated 
price in 2050. Profit margin assumptions are added to the 
estimated production costs when estimating revenue. 
The associated job potential is also estimated using 
revenue-to-job ratios for comparable industries in Australia.

For the CO2-derived products (utilising either DAC, PSC 
or flue gas CO2 feedstocks) that capture market share, 
the volume of CO2 feedstock required to manufacture the 
product is calculated.

For both CO2-derived products and bio-products that 
capture market share, the model calculates an estimate of 
the CO2 emissions abatement potential that can be achieved 
via replacement of the incumbent product.

45 Well-to-wheel carbon intensities refer to the measure of greenhouse gas emissions produced through the entire lifecycle of a fuel or energy source.

46 Derived by applying Compound Annual Growth Rate (CAGR) of 2% to the Safeguard Guard Mechanism price of $75/t out to 2050. See: Clean Energy 
Regulator (2025) Cost Containment Measure: FY2023–24 (rounded). <https://cer.gov.au/schemes/safeguard-mechanism/managing-excess-emissions/cost-
containment-measure>.

47 Derived by adapting estimates from the International Energy Agency (IEA) to align with CSIRO modelling specifications. This estimate reflects the value 
of the shadow carbon price required to achieve net zero for advanced economies. Shadow carbon prices are proxies for the combined economic effect of 
direct carbon pricing and complementary policies. See: Carbon price under Net Zero Emissions by 2050 (NZE) scenario, IEA (International Energy Agency) 
(2024) World Energy Outlook 2024. IEA, Paris, France. <https://www.iea.org/reports/world-energy-outlook-2024>.



3.1 Methanol

VALUE IN 2050

By 2050, the production of bio-methanol 
could create an estimated:

$7 billion 
revenue

5000 
jobs

Abating 
18.5 Mtpa 
CO2 emissions

DOMESTIC DEMAND IN 2050

Under both 
scenarios

Bio-methanol 
8.69 Mt
100%

CURRENT ACTIVITY

e-methanol 

2 Projects 
Pre-FEED

bio-e-methanol 

2 Projects 
FEED study

Note: These results are based on analysis of conventional methanol and a non-exhaustive selection of CO2 utilisation pathways and feedstocks for methanol 
production: e-methanol (PSC), e-methanol (DAC), bio-methanol. 

Background

Methanol (CH3OH) is an alcohol and platform chemical 
used in the production of a wide array of chemicals and 
materials such as plastics, textiles, pharmaceuticals, 
insulation, and paints. It is also used directly as a fuel and 
as a fuel additive.48 The domestic market for methanol is 
modest with Australian demand for methanol estimated 
to be 3.1 Mt per year in 2023.49 There has not been any 
industrial-scale methanol production in Australia since 
2016, when Australia’s only operating methanol plant 
(Coogee, Victoria) was placed into care and maintenance.

Methanol is conventionally produced from natural gas or 
coal and was responsible for 261 MtCO2 emissions globally 
in 2022 – equivalent to 28% of emissions from the global 
chemical sector.50 Today, the vast majority of conventional 
methanol production occurs through the reforming of 
fossil fuels to generate syngas (a mix of CO, CO2, and H2).51 
This process occurs at high temperatures (900°C) and 
pressures (16–30 bar) and is the most energy intensive and 
expensive step of the synthesis pathway.52 The resulting 
syngas is processed in a synthesis loop to yield methanol, 
in the presence of a catalyst.53 

48 Srinivasan V, Temminghoff M, Charnock S, Moisi A, Palfreyman D, Patel J, Hornung C, Hortle A (2021) CO₂ Utilisation Roadmap. CSIRO, Canberra, ACT. 
<https://www.csiro.au/-/media/Science-Connect/Futures/21-00285_SER-FUT_REPORT_CO2UtilisationRoadmap_WEB_210810.pdf>.

49 Chemanalyst (2024) Australian Methanol Market Analysis. <https://www.chemanalyst.com/industry-report/australia-methanol-market-201>.

50 IEA (2023) Chemicals. <https://www.iea.org/energy-system/industry/chemicals>. 

51 Steam methane reforming (SMR) of natural gas accounts for ~65% of global syngas production, and steam gasification of coal ~35%; Sollai S, Porcu A, Tola 
V, Ferrara F, Pettinau A (2023) Renewable methanol production from green hydrogen and captured CO2: A techno-economic assessment. Journal of CO2 
Utilization. 68, 102345. <https://www.sciencedirect.com/science/article/pii/S2212982022004644>. 

52 Azhari NJ, Erika D, Mardiana S, Ilmi T, Gunawan ML, Makertihartha I.G.B.N, Kadja TM (2022) Methanol synthesis from CO2: A mechanistic overview. Results in 
Engineering. 16, 100711. <https://www.sciencedirect.com/science/article/pii/S2590123022003814>. 

53 Dalena F, Senatore A, Marino A, Gordano A, Basile M, Basile A (2018) Chapter a – Methanol Production and Applications: An Overview. Science and 
Engineering. 3-28. <https://doi.org/10.1016/B978-0-444-63903-5.00001-7>.



To decouple methanol synthesis from fossil fuels, 
low‑emission methanol can be generated the 
following ways54:

• e-methanol is produced from captured CO2 
(PSC or DAC) and renewable hydrogen. 
• bio-methanol relies on the gasification of biomass 
to generate syngas.
• bio-e-methanol is a hybrid approach, where 
biomass‑derived syngas is supplemented with 
renewable hydrogen to improve yield. Bio-e-methanol 
is not modelled in the market assessment of this report 
due to limited data availability. 


Methanol can serve as an energy carrier or as an 
intermediate in the production of other hydrocarbon fuels. 
This is enabled by its chemical properties, with a relatively 
high energy density and liquid state under ambient 
conditions, offering ease of handling compared to 
hydrogen or liquefied natural gas. These characteristics 
position low-emission methanol as a flexible option for 
transport applications and industrial decarbonisation.

Demand for low-emission methanol is expected to 
increase, especially given its potential use as an alternative 
marine fuel. Methanol offers a pathway to reduce emissions 
from shipping. In addition to reducing CO₂ emissions it also 
generates significantly lower levels of sulphur oxides (SOx), 
nitrogen oxides (NOx), and particulate matter relative to 
conventional marine fuels. Several methanol-compatible, 
dual-fuel marine engines have been commercialised for 
medium to large vessels, including container ships and 
bulk carriers.55 

Industry status

There are currently multiple low-emission methanol 
projects in Australia that are advancing towards FEED. 
These projects aim to service growing demand for 
low‑carbon fuels in the maritime sector. HIF Global’s 
Tasmania eFuels Facility56 completed a pre-FEED study 
for a 210 ktpa e-methanol plant in 2024.57 In 2025, Vast 
Renewables completed a pre-FEED study for a 7.5 kt 
e-methanol project in Port Augusta. However, the future of 
the project is currently uncertain, as the Vast Renewables 
entered voluntary administration in November 2025.

In addition, there are multiple bio-e-methanol projects 
under development, including HAMR Energy’s Portland 
Renewable Fuels58 project (FEED underway), and ABEL 
Energy’s Bell Bay Powerfuels project in Tasmania59 
(FEED contractor announced).

54 For additional details on methanol synthesis, see the 2021 CO2 Utilisation Roadmap (CSIRO).

55 DNV (2024) Alternative Fuels Insight – Methanol use in shipping. DNV, Oslo, Norway. <https://www.dnv.com/services/alternative-fuels-insights-afi--128171/>.

56 HIF Global (n.d.) HIF Tasmania. <https://hifglobal.com/locations/tasmania>.

57 South Australia Solar Fuels (2025) Vast Secures AUD 700,000 Grant from Australia-Singapore Initiative for Decarbonising Shipping to Progress World-First 
South Australia Solar Fuels Project. <https://www.sasolarfuels.com/news-and-media/vast-secures-aud-700-000-grant-from-australia-singapore-initiative-for-
decarbonising-shipping-to-progress-world-first-south-australia-solar-fuels-project>. 

58 HAMR Energy (n.d.) Project pipeline. <https://www.hamrenergy.com/project-pipeline>.

59 CSIRO (2025) HyResource: Abel Energy Bell Bay Powerfuels Project. <https://research.csiro.au/hyresource/abel-energy-bell-bay-powerfuels-project/>.



Table 4: Announced e-methanol and bio-e-methanol projects in Australia

PROJECT 

ANNOUNCEMENT 
DATE

EXPECTED YEAR 
OF OPERATION

FUNDING

DESCRIPTION

South Australia 
Solar Fuels 
(Vast Renewables), 
South Australia

e-methanol

2024

202960

Est. $90 million 
including 
$32m via the 
Australia‑Germany 
HyGATE initiative.61

This e-methanol project is to be co-located with 
the 30 MW Vast Solar 1 (VS1) concentrated solar 
thermal power project, and includes a 10 MW 
electrolyser producing hydrogen and CO2 capture 
from a co‑located Calix lime plant to synthesise 
up to 7.5 ktpa of methanol.62 

Funding agreements were announced in 
early 2024 under the German-Australian 
Hydrogen Innovation and Technology Incubator 
(HyGATE) initiative. The project, (formerly Solar 
Methanol 1) has since been awarded additional 
funding for a supply chain feasibility study 
through the Australia-Singapore Low Emissions 
Technologies (ASLET) initiative for maritime 
and port operations (March 2025).63

STATUS: Pre-FEED completed in 2025.64 
Vast Renewables entered voluntary 
administration in November 2025.65 

HIF Tasmania 
project 
(HIF Global), 
Tasmania

e-methanol

2022

2030

Est. US$1 billion 
at full scale.66

This project aims to use up to 280 MW of 
electrolysers and CO2 captured from a biomass 
boiler to produce up to 210 ktpa of e-methanol.

STATUS: Pre-FEED study completed in 2024.67

Bell Bay 
Powerfuels Project 
(ABEL Energy), 
Tasmania

bio-e-methanol

2022

2029

Est. $2 billion 
at full scale.68

This project aims to deploy biomass gasification 
and water electrolysis (300 MW plant) to produce 
up to 360 ktpa of bio-e-methanol.

Bell Bay Powerfuels was announced as the 
provisional proponent for the Tasmanian Green 
Hydrogen Hub in May 2025.69 

STATUS: FEED study contractor announced 
in January 2024. 

Portland 
Renewable 
Fuels Project 
(HAMR Energy), 
Victoria

bio-e-methanol

2023

2027

Est. $500 thousand 
including state 
funding via 
the Portland 
Diversification 
Fund for feasibility 
study support.

This project aims to leverage local residual 
forestry biomass to produce syngas and onshore 
wind resources with a target capacity of 300 ktpa 
of bio‑e‑methanol.70 

STATUS: FEED underway in 2025. 





60 Australian Renewable Energy Agency (ARENA) (2025) Port Augusta Solar Methanol Project. <https://arena.gov.au/projects/port-augusta-solar-methanol-
project/>.

61 ARENA-administered Australian funding of AUD$19.48 million awarded to Vast and German funding of €13.2 million received by Fichtner as project co-
developer; ARENA (2023) Recipients announced for Australia-Germany HyGATE Initiative. <https://arena.gov.au/news/recipients-announced-for-australia-
germany-hygate-initiative/>.

62 CSIRO (2025) HyResource: SM1 – Solar Methanol 1 Project. <https://research.csiro.au/hyresource/sm1/>.

63 Vast Renewables Ltd (2025) Vast secures AUD 700,000 grant from Australia-Singapore Initiative for decarbonising shipping to progress world-first South 
Australia Solar Fuels Project. <https://www.vast.energy/news/vast-secures-aud-700-000-grant-from-australia-singapore-initiative-for-decarbonising-shipping-
to-progress-world-first-south-australia-solar-fuels-project>.

64 Vast (2025) Vast Secures AUD 700,000 Grant from Australia-Singapore Initiative for Decarbonising Shipping to Progress World-First South Australia Solar 
Fuels Project. <https://www.vast.energy/news/vast-secures-aud-700-000-grant-from-australia-singapore-initiative-for-decarbonising-shipping-to-progress-
world-first-south-australia-solar-fuels-project>

65 KPMG (2025) Vast Renewables Limited. <https://kpmg.com/au/en/creditors/vast-renewables.html>.

66 HIF Global (n.d.) HIF Tasmania. <https://hifglobal.com/locations/tasmania>.

67 CSIRO (2025) HyResource: HIF Tasmania eFuels Facility. <https://research.csiro.au/hyresource/hif-tasmania-efuels-facility/>.

68 Infrastructure Partnerships Australia (n.d.) Bell Bay Powerfuels Project. <https://infrastructurepipeline.org/project/bell-bay-powerfuel-project>.

69 CSIRO (2025) HyResource: Abel Energy Bell Bay Powerfuels Project. <https://research.csiro.au/hyresource/abel-energy-bell-bay-powerfuels-project/>.

70 HAMR Energy (n.d.) Portland Renewable Fuels. <https://www.hamrenergy.com/portland-renewable-fuels>.



Globally, e-methanol production has advanced to 
an early commercial stage. Significant projects and 
proposals include:

• Carbon Recycling International technology has 
been deployed at an industrial scale in a range of 
locations globally. The largest of which, the 110 ktpa 
Shunli plant in China, completed construction 
in 2022 – marking the world’s first commercial-scale 
emissions‑to‑liquids facility.71 The Jiangsu Sailboat 
project became operational in 2023 (100 ktpa capacity), 
cited to be the most efficient CO2-to-methanol plant.72 
The technology is also deployed at pilot scale in 
Germany and at an industrial-scale in Iceland with 
integrated electrolyser capacity.73
• The Fairway Methanol project (US) is a joint venture 
between Mitsui & Co. and Celanese Corporation, 
which commenced production of e-methanol from 
CO2 sourced from Celanese’s chemical production site 
in Texas. The facility has capacity to produce 130 ktpa 
of e-methanol, from the capture of 180 ktpa of CO2.74
• HIF Global’s Matagorda eFuels Facility (US) 
has completed Front End Engineering and Design 
(FEED) and is permitted to commence construction. 
When fully constructed, it would produce up to 
1.4 Mtpa e-methanol.75


Industry insights

Stakeholder consultations and desktop research identified 
the following industry insights:

• The viability of e-methanol projects is still limited 
by market willingness to pay for sustainable 
methanol alternatives. Even with emerging regulations 
and an increasing CO2 emission cost, many customers 
are not yet able to absorb the green premium, which 
makes it difficult to secure bankable projects and 
slows deployment. This is compounded by slower 
than expected development of renewable hydrogen 
projects and the resulting uncertainty in input costs 
and availability. Parallel challenges in scaling CO2 capture 
and ensuring reliable supply chains may further constrain 
the pace of industry deployment.
• Early offtake agreements are critical for signalling 
market demands and securing investment in 
production supply chains, with early interest indicated 
by maritime and aviation sectors. Though offtake 
agreements remain difficult to secure given the 
immaturity of supply chains and price uncertainty for 
renewable products, there are signs of early-stage 
coordination across supply chains.76 For example, the 
Port of Melbourne has signed an MoU with several 
entities to examine a potential project involving the 
transportation of methanol from production sites 
in Bell Bay, Tasmania (ABEL Energy) and Portland, 
Victoria (HAMR Energy) for storage and bunkering 
services in Melbourne.77 National frameworks, such as 
Australia’s forthcoming Maritime Emissions Reduction 
National Action Plan, are also expected to drive demand 
for low‑emission methanol in the maritime sector. 
While activity is centred on the maritime sector, some 
proponents, such as HAMR Energy, are also pursuing 
aviation markets (see also Section 3.2).


71 Carbon Recycling International (2023) CRI and Jiangsu Sailboat start up world’s most efficient CO₂-to-methanol plant. <https://carbonrecycling.com/about/
news/carbon-recycling-international-cri-and-jiangsu-sailboat-start-up-worlds-most-efficient-co2-to-methanol-plant>.

72 Carbon Recycling International (n.d.) Carbon Recycling International and Jiangsu Sailboat start up world’s most efficient CO₂-to-methanol plant. 
<https://carbonrecycling.com/projects/sailboat>.

73 Carbon Recycling International (n.d.) ETL technology. <https://carbonrecycling.com/etl-technology>.

74 Mitsui & Co. Ltd. (2024) US Methanol JV commences production of methanol derived from CO₂. <https://www.mitsui.com/jp/en/
topics/2024/1248163_14380.html>.

75 HIF Global (n.d.) HIF Matagorda. <https://hifglobal.com/locations/matagorda>.

76 Australian Renewable Energy Agency (ARENA) (2025) Vast – Port Augusta Solar Methanol Project – Lessons Learnt Report. <https://arena.gov.au/
assets/2025/06/Vast-Port-Augusta-Solar-Methanol-Project-Lessons-Learnt-Report.pdf>.

77 Port of Melbourne (2023) Green methanol MoU signed with Melbourne port. <https://www.portofmelbourne.com/wp-content/uploads/Joint-Media-
Release-Green-methanol-MoU-signed-with-Melbourne-port.pdf>.



• The success of low-emission methanol projects is linked 
to the accessibility of low-cost renewable energy.78 
Proponents often seek integration with co‑located 
renewable generation to reduce the cost of 
electricity supply. However, other proponents may 
favour grid connections and Renewable Energy 
Certificates to avoid exposure to the high capital costs 
and extended development times associated with 
new‑build renewable energy projects, and ensure access 
to a continuous supply of energy for large-scale low 
carbon liquid fuels projects. 
• Projects demonstrate diversity in prospective 
carbon feedstocks, ranging from biological sources 
(ABEL and HAMR) to captured industrial process CO₂ 
(South Australia Solar Fuels). Utilisation of CO2 from 
fermentation processes (e.g. ethanol production 
from sugarcane) may also have potential as a near-term 
CO2 feedstock.79 While this suggests that the industry is 
still exploring multiple utilisation pathways, bio‑derived 
projects appear to be early leaders. In the longer term, 
supply-side limitations on sustainable biological 
carbon sources may create increasing demand for 
CO₂‑derived methanol. 


78 Australian Renewable Energy Agency (ARENA) (2025) Vast – Port Augusta Solar Methanol Project – Lessons Learnt Report. <https://arena.gov.au/
assets/2025/06/Vast-Port-Augusta-Solar-Methanol-Project-Lessons-Learnt-Report.pdf>.

79 Blaine M, Webley P and Honnery D (2025) CO2e emissions of renewable methanol from forestry residues and conventional natural gas-based methanol: 
a comparative analysis. Energy Environmental Science. 18, 6325.



2050 market assessment

Scope of analysis 

This analysis assesses the potential demand for e-methanol 
products derived using PSC and DAC CO2 sources in a 
simplified 2050 domestic methanol market. The two 
e-methanol products are compared against conventional 
methanol and bio-methanol reference products. 
Bio‑e‑methanol was not modelled in this report but 
should be considered in further work. 

The methodology, assumptions and results of this analysis 
are described in detail in Appendices A.2 and A.3.

Table 5: Assessed and reference methanol product descriptions

PRODUCT

DESCRIPTION

ASSESSED 
PRODUCTS

e-methanol (PSC)

Methanol produced from electrolytic hydrogen and CO₂ from industrial point sources.

e-methanol (DAC)

Methanol produced from electrolytic hydrogen and CO₂ from direct air capture.

REFERENCE 
PRODUCTS

Conventional 
methanol

Methanol produced from fossil fuels (natural gas or coal). This assessment assumes a 
weighted average of both routes, assuming 65% of global production is via steam methane 
reforming, and 35% via coal gasification.

Bio-methanol

Methanol produced from biomass feedstocks such as forestry residues or municipal 
solid wastes.





Cost competitiveness

The modelled LCOP and CO2 emissions cost for methanol 
products in each scenario is shown in Figure 7. Under the 
modelled scenarios, e-methanol production from PSC 
is found to be more cost-competitive compared to 
conventional methanol, largely driven by the high emissions 
intensity associated with incumbent production processes. 
E-methanol produced using DAC also becomes cost 
competitive under the high ambition scenario. Of the two 
CO2-derived products, point sourced e-methanol proves to 
be the least expensive, with lower carbon feedstock costs 
relative to DAC.

Overall, bio-methanol is found to be the most cost 
competitive product in 2050. This is driven by lower 
production costs, and lower emission intensity compared to 
both conventional and point source e-methanol production.

Figure 7: LCOP and CO2 emission costs for methanol products in 2050

Demand

The modelled domestic demand for methanol in each 
scenario is shown in Figure 8. The demand for each 
methanol product has been projected for each ambition 
scenario based on its cost and estimated production 
limit (see Appendix A.3 for more details). Given its cost 
competitiveness, bio-methanol is projected to capture 
the entire market share under the modelled conditions. 
Feedstock supply is not expected to constrain production, 
as total methanol demand does not exceed assumed 
production limit of 9.1 Mtpa.80

Figure 8: Modelled demand for methanol products in 2050

Some analysts suggest that low-carbon methanol could 
become the dominant maritime fuel in the future. If this 
occurs, global demand for methanol products could 
approach 540 Mtpa in 2050.81 This suggests that Australian 
demand for low-carbon methanol for international 
maritime transport could reach up to 76 Mtpa by 2050.82 
This demand would significantly exceed the domestic 
supply limit assumption for bio-methanol. The cost 
competitiveness results suggest that this could create 
significant demand for e-methanol (PSC). Under the 
high ambition scenario, e-methanol (DAC) is also cost 
competitive, making it likely to capture a share of the 
demand if PSC CO2 sources are exhausted.83 

Economic benefits and CO2 abatement potential

If Australian industry supplies the forecast domestic 
demand for bio-methanol, the modelling estimates 
domestic revenue of $7 billion and employment 
potential of 5000 jobs in 2050, approximated using the 
employee‑to‑revenue benchmark for the basic organic 
chemical manufacturing industry in Australia.

If methanol production continues to rely on conventional 
fossil-based pathways, meeting the projected 2050 
demand of 8.7 Mt could result in an estimated 20.3 Mt of 
CO2 emissions.84 If this demand is replaced by bio-methanol, 
the associated CO2 emissions would be reduced by 
18.5 Mt CO2 per annum (a reduction of 91%). 


80 Municipal solid waste, agricultural and sawmill residues, and sorghum are considered as bio-feedstocks in this modelling. While other biomass sources are 
also suitable for bio-methanol production, a detailed assessment is beyond the scope of this report. See Appendix A.3 for more details. 

81 Green methanol production would have to reach over 540 million metric tons per year to fully replace all marine fuel by 2050. Figure 3: Cumulative green 
methanol capacity planned and needed. Burga B (2023) Green methanol makes a splash in quest for net-zero shipping. BloombergNEF. <https://about.bnef.
com/insights/clean-transport/green-methanol-makes-a-splash-in-quest-for-net-zero-shipping/>.

82 Australia’s share of global sea freight is around 14%, contributing to 76 Mt of methanol demand as maritime fuel. Department of Infrastructure, Transport, 
Regional Development, Communications and the Arts (DITRDCA), BloombergNEF (2024) MERNAP Issues Paper 4: Green shipping corridors and partnerships. 
<https://www.infrastructure.gov.au/sites/default/files/documents/mernap-issues-paper-4-green-shipping-corridors-and-partnerships-march2024.pdf>.

83 Based on Treasury’s Baseline Scenario, emissions from Australia’s industrial and waste sectors are projected to decline from 61 MtCO₂-e in 2025 to 32 
MtCO₂-e by 2050. This correlates to an optimistic maximum e-methanol (PSC) supply of 23.3 Mt if all of these emissions were capture and converted to 
e-methanol. This is an overestimate of the potential supply as not all these greenhouse gas emissions will be CO2 and amenable to capture and utilisation. 
See: Department of Industry, Science and Resources (2025) Industry Sector Plan. <https://www.industry.gov.au/sites/default/files/2025-09/disr-industry-
sector-plan.pdf>.

84 The well-to-wake emissions for conventional methanol are estimated at 2.34 t CO₂ per tonne of product. Emissions estimates for both methanol and 
bio‑methanol assume that all CO₂ embodied in the product is released during use. See Appendix A3 for further details. 



3.2 Aviation fuel

VALUE IN 2050

By 2050, the production of bio-SAF 
could create an estimated: 

$5 billion 
revenue

4100 
jobs

Abating 
11.3 Mtpa 
CO2 emissions

DOMESTIC DEMAND IN 2050 

Under the high 
ambition scenario

Conventional 
Jet Fuel 
8.88 Mt
72%

Bio-SAF (FT)
3.2 Mt 
26%

Bio-SAF 
(HEFA)
0.21 Mt 
2%

CURRENT ACTIVITY

e-SAF 

1 Project 
Feasibility study

bio-SAF 

1 Project 
FEED study

Note: These results are based on analysis of conventional jet fuel and a non-exhaustive selection of pathways and feedstocks for SAF production: e-SAF 
(PSC), e-SAF (DAC), bio-SAF (HEFA), bio-SAF (FT).

Background

Conventional jet fuels used in aviation (Jet A and Jet A-1) are 
refined from crude oil via distillation and hydro-processing. 
Their combustion contributes significantly to global 
emissions, making aviation one of the more difficult sectors 
to decarbonise due to long asset lifetimes, high energy 
density requirements, a lack of readily available technology 
substitutes, and global infrastructure lock-ins. Australia’s 
aviation subsector emitted 12 MtCO₂-e in 2023–24, 
accounting for 9% of Australia’s total transport emissions85 
and as hard-to-abate industry, absolute emissions are 
expected to grow.86 

SAFs are a drop-in liquid hydrocarbon alternatives to 
conventional jet fuels that offer a pathway to reduce 
life‑cycle emissions from aviation. SAFs are designed to be 
compatible with existing jet engines and fuelling systems, 
enabling near-term emissions reductions without requiring 
substantial changes to the aircraft or airport infrastructure. 

SAFs can be produced from a range of feedstocks. Synthetic 
fuels derived from captured CO2 and renewable hydrogen, 
commonly referred to as e-SAFs or Power-to-Liquids (PtL), 
are a promising subcategory due to their potential for 
large scale production if large quantities of renewable 
energy and CO2 capture are scaled, avoiding land-based 
and biomass related constraints. The potential for these 
pathways in the Australian context is explored further 
in the CSIRO-Boeing SAF Roadmap released in 2023.87

85 Climate Change Authority (2024) Sector Pathways Review: Transport. <https://www.climatechangeauthority.gov.au/sites/default/files/documents/2024-
09/2024SectorPathwaysReviewTransport.pdf> (accessed 21 March 2025).

86 Ritchie H (2020) Climate change and flying: what share of global CO₂ emissions come from aviation? <https://ourworldindata.org/co2-emissions-from-
aviation> (accessed 17 January 2023).

87 CSIRO (2023) Sustainable Aviation Fuel Roadmap. <https://www.csiro.au/-/media/Energy/Sustainable-Aviation-Fuel/Sustainable-Aviation-Fuel-Roadmap.pdf>.



Within international policy frameworks, SAFs are 
considered a core decarbonisation lever for aviation. 
The International Civil Aviation Organization (ICAO) 
recognises SAFs under its Carbon Offsetting and Reduction 
Scheme for International Aviation (CORSIA) scheme and 
has developed a methodology to evaluate SAF life‑cycle 
emissions, sustainability criteria, and eligibility for 
emissions crediting. Concurrently, industry groups such 
as the International Air Transport Association (IATA) 
and Airports Council International (ACI) are standing by 
commitments to achieve net-zero emissions by 2050.88 
Several SAF production pathways have been approved 
by Advancing Standards Transforming Markets (ASTM) 
International for blending with conventional jet fuel at 
specified ratios.89 

Industry status

Demand for SAF is driven largely by commitments from 
airlines to decarbonise operations and by customers 
looking to reduce their Scope 3 emissions, alongside 
interest from energy companies and state governments 
in positioning Australia as a renewable fuel exporter. 
A number of industry and government partnerships 
and initiatives have been announced. In 2025, Wagner 
Sustainable Fuels commenced operations of Australia’s first 
SAF-blending facility at Toowoomba Wellcamp Airport, 
in partnership with Boeing and FlyORO.90 This facility could 
in principle accommodate e-SAF products if they were to be 
produced domestically. Qantas’ SAF Coalition (established 
2023) has now reached 14 partners and members which 
contribute to the incremental cost of sustainable aviation 
fuel purchased by Qantas.91 The Queensland Government 
and Qantas formalised a strategic partnership in 2023 to 
establish a green jet fuel industry in Queensland leveraging 
sugarcane and agricultural by-products. The Australian Jet 
Zero Council was announced (2023) to provide coordinated 
advice and lead efforts for aviation decarbonisation. 

Domestic e-SAF activity is limited in Australia. The only 
e-SAF project identified in Australia is a Zero Petroleum 
feasibility study announced in 2024, evaluating the viability 
of a 10 ML (~8000 t) facility in Whyalla, South Australia 
(see Table 6).92 

Most activity to date in Australia has focused on 
bio‑based SAF pathways, drawing on residues, energy 
crops, and waste oils. The most mature SAF project in 
development is Project Ulysses (LanzaJet and Jet Zero, 
currently completing FEED). Several other pre-FEED 
project assessments remain ongoing.93 For example, 
HAMR Energy has also completed feasibility work for a 
bio-methanol‑to‑jet facility with Melbourne or Adelaide 
shortlisted as host locations.

At least two projects that were previously under 
development have not proceeded. These include 
the Oceania Biofuels biorefinery proposed for 
Gladstone, Queensland, which was announced in 
2022 and discontinued in 202494 and BP’s proposed 
Kwinana Renewable Fuels project that has paused its 
development in 2025.95

88 International Air Transport Association (IATA) (2021) Net-zero carbon emissions by 2050. <https://www.iata.org/en/pressroom/pressroom-archive/2021-
releases/2021-10-04-03/> (accessed 17 January 2023); Airports Council International (2021) Net zero by 2050: ACI sets global long term carbon goal for 
airports. <https://aci.aero/2021/06/08/net-zero-by-2050-aci-sets-global-long-term-carbon-goal-for-airports/> (accessed 17 January 2023).

89 Currently, ten SAF production pathways have been approved by ASTM, eight under ASTM D7566 and two co-processing pathways under D1655. ASTM 
International (2022) ASTM D7566-22: Standard specification for aviation turbine fuel containing synthesized hydrocarbons. <https://www.astm.org/d7566-
22.html>; ASTM International (2022) ASTM D1655-22a: Standard specification for aviation turbine fuels. <https://store.astm.org/d1655-22a.html>. 

90 Boeing Australia (2025) Wagner delivers Australia’s first dedicated Sustainable Aviation Fuel Blending Terminal. <https://www.boeing.com.au/news/2025/
wagner-delivers-australia-s-first-dedicated-saf-blending-termina>

.

91 Qantas (2024) Australia’s largest import of sustainable aviation fuel lands in Sydney. <https://www.qantasnewsroom.com.au/media-releases/australias-
largest-import-of-sustainable-aviation-fuel-lands-in-sydney/>.

92 Government of South Australia (2024) Whyalla set to take flight with sustainable aviation fuel project. <https://statedevelopment.sa.gov.au/news/whyalla-
set-to-take-flight-with-sustainable-aviation-fuel-project>.

93 Australian Renewable Energy Agency (ARENA) (n.d.) Ampol Brisbane Renewable Fuels Pre-FEED Study. <https://arena.gov.au/projects/ampol-brisbane-
renewable-fuels-pre-feed-study/>.

94 S&P Global Commodity Insights (2024) Oceania Biofuels scraps A$500 million Australia SAF and R&D project. <https://www.spglobal.com/commodity-
insights/en/news-research/latest-news/agriculture/071624-oceania-biofuels-scraps-a500-million-australia-saf-and-rd-project-epbc>.

95 S&P Global Commodity Insights (2025) BP puts the brakes on Australia’s Kwinana biofuels project. <https://www.spglobal.com/commodity-insights/en/news-
research/latest-news/agriculture/020425-bp-puts-the-brakes-on-australias-kwinana-biofuels-project>.



Table 6: Announced e-SAF and bio-SAF projects in Australia

PROJECT 

ANNOUNCEMENT 
DATE

EXPECTED YEAR 
OF OPERATION

FUNDING

DESCRIPTION

Plant Zero.SA 
(Zero Petroleum), 
South Australia

e-SAF

2024

202696

–

After signing an MoU with the South Australian 
Government, Zero Petroleum is undertaking a 
feasibility project to evaluate the viability of a 
facility in Whyalla capable of producing up to 
10 ML (~8000 t) of e-SAF annually.97 

STATUS: Feasibility study commenced 
in 2024.98

Project Ulysses 
(Jet Zero Australia 
and LanzaJet), 
Queensland

Bio-SAF

2024

2027

Est. $36.8 million 
including $9m ARENA 
funding and $5m 
from Queensland 
New-Industry 
Development 
Strategy (QNIDS) 
funding program. 

Announced in 2024, the project aims to convert 
183 ML of agricultural by-product-based ethanol 
feedstock into 113 ML bio-SAF, balanced with 
renewable diesel.

STATUS: FEED study commenced in 2024.99 





Internationally, SAF production remains dominated by 
HEFA and Alcohol-to-Jet (ATJ) pathways. However, multiple 
demonstration and commercial-scale e-SAF facilities are 
under development, largely driven by supportive policies, 
particularly in Europe and the US. Notable commercial scale 
e-SAF projects and proposals include: 

• Infinium’s Project Roadrunner (US) began construction 
in 2025 and aims to commence commercial operation 
in 2027. It will produce up to 23 ktpa e-SAF.100
• Arcadia eFuels (US) has completed FEED and obtained 
environmental permits for its proposed e-SAF facility in 
Denmark with an expected capacity of up to 80 ktpa.101
• SkyKraft (Sweden) is a joint venture between 
SkyNRG and Skellefteå Kraft that aims to produce up 
to 100 ktpa e-SAF. The project is currently undertaking 
technical studies and environmental permitting and aims 
to reach Final Investment Decision (FID) in 2027.102


96 Zero Petroleum (2024) Zero marks a historic move into the Australian market with vintage motorbike. <https://www.zero.co/news-media/zero-marks-a-
historic-move-into-the-australian-market-with-vintage-motorbike>.

97 Government of South Australia (2024) Whyalla set to take flight with sustainable aviation fuel project. <https://statedevelopment.sa.gov.au/news/whyalla-
set-to-take-flight-with-sustainable-aviation-fuel-project>.

98 Zero Petroleum (2024) Zero marks a historic move into the Australian market with vintage motorbike. <https://www.zero.co/news-media/zero-marks-a-
historic-move-into-the-australian-market-with-vintage-motorbike>.

99 Australian Renewable Energy Agency (ARENA) (2024) Jet Zero Australia – FEED Study for Project Ulysses ATJ SAF Plant. <https://arena.gov.au/projects/jet-
zero-australia-feed-study-for-project-ulysses/>.

100 Infinium (n.d.) Project Roadrunner. <https://www.infiniumco.com/roadrunner>.

101 Arcadia eFuels (n.d.) News. <https://arcadiaefuels.com/news/>.

102 SkyKraft (n.d.) Large-scale sustainable aviation fuel (eSAF) production in Sweden. <https://skykraft.se/en/home/>.



Industry insights

Note: due to similarities in their feedstocks and production 
processes, the methanol industry insights in Section 3.1 are 
also relevant to SAF production.

Stakeholder consultations and desktop research identified 
the following industry insights:

• Australia’s SAF development will be shaped by 
both international partnerships and positioning 
within global markets, though progress could 
be strengthened further by domestic support. 
Australia’s aviation sector is highly dependent on 
long-haul flights, creating a strong imperative for SAF 
development. In the absence of domestic SAF mandates 
and policy frameworks, early projects remain exposed 
to global competition but could also potentially produce 
fuels for exports to markets with stronger demand 
incentives. The progress of Project Ulysses underscores 
the importance of international technology partnerships 
and export-oriented positioning. 
• Capital intensity and feedstock risk are central 
challenges for bio-SAF, with technology immaturity 
and high costs expected to continue to constrain 
e-SAF development in the medium-term. e-SAF faces 
not only high costs but also dependence on large-scale 
renewable hydrogen and CO₂ utilisation infrastructure, 
neither of which yet exists in Australia at the scale 
required. Though structural costs for supporting 
technologies like hydrogen production are expected 
to decline over the long-term, the timing of these 
reductions is and has been uncertain. 
• Establishing sufficient aggregated demand through 
industry partnerships will be crucial for supporting 
infrastructure scale-up. Aggregating demand not 
only reduces developer risk but also creates the scale 
economies needed to drive costs down over time.
• Global industry stakeholders are advocating for 
collective effort from industry and government to 
reach commercial e-SAF production. For example, 
Project SkyPower in Europe identified five steps to 
increase the likelihood of getting e-SAF projects to FID 
in short term: Creating regulatory certainty, securing 
public funding, establishing offtake contracts, providing 
low‑interest loans and loan guarantees, and developing 
appropriate risk sharing models.103 


103 Project SkyPower (2024) Accelerating the take-off for e-SAF in Europe. <https://www.systemiq.earth/wp-content/uploads/2024/10/Project-SkyPower-
Insights.pdf>



2050 market assessment

Scope of analysis 

This analysis assesses the potential demand for e-SAF 
products derived using PSC and DAC CO2 sources in a 
simplified 2050 domestic aviation fuel market. The two 
e-SAF products are compared against conventional jet fuel 
(CJF) and two bio-SAF reference products. 

The methodology, assumptions and results of this analysis 
are described in detail in Appendices A.2 and A.4.

Table 7: Assessed and reference aviation fuel product descriptions

PRODUCT

DESCRIPTION

ASSESSED 
PRODUCTS

e-SAF (PSC)

e-SAF produced from electrolytic hydrogen and CO2 acquired from industrial point source 
emissions, through an ATJ production pathway.

e-SAF (DAC)

e-SAF produced from electrolytic hydrogen and CO2 acquired from Direct Air Capture (DAC), 
through an ATJ production pathway.

REFERENCE 
PRODUCTS

Conventional 
Jet Fuel (CJF)

CJF produced from crude oil through fractal distillation and hydrotreating.

Bio-SAF (FT)

SAF derived from carbohydrates (eg. Bagasse), municipal solid waste, and agricultural and 
sawmill residues as feedstocks, to produce biofuels through the Fischer-Tropsch process.

Bio-SAF (HEFA)

SAF derived from lipid-based feedstocks, to produce Hydroprocessed Esters and Fatty Acids 
Synthetic Paraffinic Kerosine (HEFA-SPK) fuel.





Cost competitiveness

The modelled LCOP and CO2 emissions cost for aviation fuel 
products in each scenario is shown in Figure 9. Under all 
modelled scenarios, CO2-derived e-SAF products are not 
competitive with the conventional jet fuel incumbent 
product or the emerging bio-SAF alternatives. However, 
demand for e-SAF (PSC) could become competitive with 
conventional jet fuel in the high ambition scenario 
if hydrogen prices were to become much lower than 
currently estimated (approximately $1.8/kg or less).

Under the low ambition scenario, bio-SAF (FT) is cost 
competitive product with conventional jet fuel. Under the 
high ambition scenario, both bio-SAF products become 
cost competitive with conventional jet fuel. 

Figure 9: LCOP and CO2 emission costs for aviation fuel products in 2050

Demand

The modelled domestic demand for aviation fuel products 
in each scenario is shown in Figure 10. Due to its high 
production cost, demand for e-SAF products is negligible 
in the modelled scenarios.

Feedstock limitations constrain the supply of bio-SAF 
products (see Appendix A.4 for assumptions), leading to 
redistribution of unmet demand to more cost-competitive 
alternatives. As a result, conventional jet fuel (with offset 
emissions) may continue to hold a substantial market 
share in both 2050 scenarios, if this shortfall is not met 
by SAF imports.

Supply constraints are anticipated at 3.2 Mtpa for bio-SAF 
(FT) which could supply approximately 26% of the future 
aviation fuel demand.104 Under the high ambition scenario, 
bio-SAF (HEFA) becomes a viable product and supplies 2% 
of the future aviation fuel demand, as supply constraints 
are anticipated at 0.2 Mtpa.105 Policies that discourage or 
prohibit the use of conventional jet fuel could increase 
demand for alternative SAFs, including e-SAF products, 
despite their higher cost. 

Figure 10: Modelled demand for aviation fuel products in 2050

Economic benefits and CO2 abatement potential

If Australian industry meets the projected domestic 
demand for bio-SAF, the low ambition scenario indicates 
potential domestic revenue of $5 billion and employment 
of around 3800 jobs by 2050 for bio-SAF (FT). Under the 
high ambition scenario, where bio-SAF (HEFA) also becomes 
cost-competitive, the modelling projects an additional 
$0.4 billion in domestic revenue and 300 additional jobs 
by 2050. Employment potential is estimated using the 
employee-to-revenue ratio from Australia’s petroleum 
refining and fuel manufacturing sector.

If aviation fuel production continues to rely on conventional 
fossil-based pathways, meeting the projected 2050 demand 
of 12.3 Mtpa could result in an estimated 43.5 Mtpa of CO2 
emissions that would need to be abated with offsets or CDR 
to achieve net zero emissions.106 The modelled demand for 
bio-SAF products could abate between 10.8 and 11.3 Mtpa 
CO2 emissions (a 24.8–26% reduction). 


104 Domestic biomass feedstock (including municipal solid waste, agricultural and sawmill residues, and bagasse) are considered for bio-SAF (FT) pathway. 
See Appendix A.4 for more details.

105 Domestic biomass feedstock (including tallow, cottonseed, and canola) are considered for bio-SAF (HEFA) pathway. See Appendix A.4 for more details.

106 The well-to-wake emissions for conventional jet fuel are estimated at 3.54 tCO₂ per tonne of product. The conventional jet fuel and bio-SAF emissions 
estimates assume that all CO2 embodied in the fuel is released during product use. See Appendix A4 for further details. 



3.3 Urea

VALUE IN 2050

By 2050, the production of urea (PSC) 
could create an estimated:

$1.6 billion 
revenue

1000 
jobs

Abating 
2.1 Mtpa 
CO2 emissions

DOMESTIC DEMAND IN 2050

Under both 
scenarios

Urea (PSC) 
2.74 Mt 
100%

CURRENT ACTIVITY

Green ammonia 

2 Projects 
FEED and FID

NG ammonia 

1 Project 
Construction

Note: These results are based on analysis of conventional urea and a non-exhaustive selection of CO2 utilisation pathways and feedstocks for low-carbon 
production: urea (PSC) and urea (DAC).

Background

Urea is a nitrogen-based fertiliser produced through 
the reaction of ammonia (NH3) with CO2 at high 
pressure. It is the most widely used nitrogen fertiliser 
globally, accounting for around 50% of global consumption 
and nearly 70% of Australian consumption.107 In 2023 
Australia imported around 3.2 Mt urea to service 
this demand.108 Australia has no operational urea 
production facilities, but Perdaman Chemicals & Fertilisers 
are constructing a 2.3 Mt plant in WA with an expected 
completion date in 2027. 109 This would supply over 
70% of Australia’s 2023 urea demand. 

While primarily applied as a straight fertiliser, urea is also 
used in the production of NPK (nitrogen-phosphorus-
potassium) compound fertilisers. It is also used as feedstock 
in melamine and urea-formaldehyde resin production, 
as a dietary supplement in ruminant diets, and in AdBlue 
(a diesel exhaust fluid used in some vehicles to reduce 
harmful NOx gases being released into the atmosphere).

107 International Fertilizer Association (IFA) (2018) Statistics: production & international trade. <https://www.ifastat.org/> (accessed 18 January 2023).

108 World Bank (2023) Australia urea imports by country. <https://wits.worldbank.org/trade/comtrade/en/country/AUS/year/2023/tradeflow/Imports/partner/
ALL/product/310210>. 

109 Perdaman Chemicals and Fertilisers (2025) Project Ceres. <https://perdamanchemicalsandfertilisers.com/project/ceres/>.



Conventionally, urea is synthesised from fossil-derived 
inputs, where methane (or occasionally, syngas produced 
from gasified coal), atmospheric nitrogen, and water are 
reacted at high temperature and pressure to produce 
ammonia and CO2.110 The ammonia and a portion of the 
CO2 are then reacted to form urea.111 The production 
and use of urea is responsible for around 2% of total 
CO2-e emissions and over 10% of agricultural emissions 
globally, with the main contributors coming from synthesis 
and field emissions.112 Global urea production was estimated 
at 201 Mt in 2024 and nitrogen fertiliser demand is expected 
to continue growing at 1–2% annually in coming years.113

Transitioning to low-carbon urea production hinges on 
the availability of low-emissions ammonia and sustainable 
CO2 sources to replace the conventional methane 
(or coal) feedstocks. Electrolytic hydrogen (produced via 
water electrolysis using renewable electricity) could be 
reacted with atmospheric nitrogen to produce ammonia. 
This process change can potentially be achieved without 
major disruption by retrofitting existing ammonia plants.114 

Because there is excess CO2 produced in the conventional 
production of urea, there is also potential for hybrid 
urea production (incorporating renewable hydrogen 
feedstock into conventional urea projects). While this has 
not been modelled in this report, it may offer a nearer 
term opportunity for emissions intensity reductions in 
the urea industry.

Industry status

There are no active low-carbon urea projects or proposals 
in Australia. Australia saw a wave of interest in green 
ammonia production in 2020–21, reflecting both the 
strategic importance of domestic fertiliser security 
and the emerging role of green ammonia (a critical 
input for urea production using DAC or PSC CO2) 
in decarbonisation pathways. Since the closure of 
Incitec Pivot’s natural gas-based Gibson Island urea plant 
in 2023 Australia is fully reliant on urea imports.115 In 2024, 
Fortescue Future Industries and Dyno Nobel (formerly 
Incitec Pivot) undertook a FEED study for industrial-scale 
manufacturing of green ammonia production at the Gibson 
Island site.116 However, the project has not progressed, 
with Dyno Nobel divesting from the site and selling their 
fertiliser distribution business in May 2025.117 

As there are no low-carbon urea projects announced 
in Australia, Table 8 summarises announced hybrid and 
green ammonia projects to give context for the potential 
development of low-carbon urea projects in the future. 

110 Incitec Pivot Fertilisers (2021) Fact sheet – urea. <https://www.incitecpivotfertilisers.com.au/contentassets/5d912d3ebea9460e93c4c608c5277243/32-urea-
fact-sheet.pdf> (accessed 18 January 2023); Ghavam S, Vahdati M, Wilson I, Styring P (2021) Sustainable ammonia production processes. Frontiers in Energy 
Research 9, Article 580808. <https://www.frontiersin.org/journals/energy-research/articles/10.3389/fenrg.2021.580808/full>.

111 Grains Research and Development Corporation (GRDC) (2023) Sustainable fertilisers for Australian growers. <https://grdc.com.au/__data/assets/pdf_
file/0029/591536/GRDC-Urea-Report-Factsheet.pdf>.

112 Menegat S, Ledo A, Tirado R (2022) Greenhouse gas emissions from global production and use of nitrogen synthetic fertilisers in agriculture. Scientific 
Reports 12, Article 18773. <https://www.nature.com/articles/s41598-022-18773-w.pdf>.

113 International Fertilizer Association (IFA) (2025) Public Summary: Medium-Term Fertilizer Outlook 2025–2029. IFA Annual Conference, Monaco, 12–14 May. 
<https://www.ifastat.org/market-outlooks>.

114 MacFarlane DR, Cherepanov PV, Choi J, Suryanto BHR, Hodgetts RY, Bakker J, Ferrero Vallana FM, Simonov AN (2021) A roadmap to the ammonia economy. 
ARC Centre of Excellence for Electromaterials Science, School of Chemistry, Monash University, Clayton, Victoria, Australia. <https://researchmgt.monash.
edu/ws/portalfiles/portal/310071142/310069820_oa.pdf> (accessed 14 January 2025).

115 The site was used to produce anhydrous ammonia, ammonium sulphate fertiliser and urea for agricultural customers, as well as AdBlue (a liquid additive 
used to remove harmful exhaust emissions from diesel vehicles) and carbon dioxide for industrial uses. Fortescue Future Industries (2024) Gibson Island 
Renewable Ammonia Project – Public FEED Summary Report. <https://arena.gov.au/assets/2024/10/Fortescue-Future-Industries_Gibson-Island-Renewable-
Ammonia-Project-FEED-Study_Public-FEED-Summary-Report.pdf>.

116 Fortescue Future Industries (2024) Gibson Island Renewable Ammonia Project – Public FEED Summary Report. <https://arena.gov.au/assets/2024/10/
Fortescue-Future-Industries_Gibson-Island-Renewable-Ammonia-Project-FEED-Study_Public-FEED-Summary-Report.pdf>.

117 Real Estate Source (2025) Goodman buys Gibson Island. <https://www.realestatesource.com.au/goodman-buys-gibson-island/>.



Table 8: Announced green ammonia projects in Australia

PROJECT 

ANNOUNCEMENT 
DATE

EXPECTED YEAR 
OF OPERATION

FUNDING

DESCRIPTION

YURI Project 
(ENGIE), Western 
Australia118

Renewable 
hydrogen and 
natural gas-derived 
ammonia

2019

2025

Est. $87 million 
including a 
$47.5 million grant 
from the Australian 
Renewable Energy 
Agency (ARENA) 
and an additional 
$2 million from the 
Western Australian 
government.

A 10 MW electrolyser is being installed to 
produce renewables-based hydrogen to 
supplement natural gas use in Yara Fertilisers’ 
existing liquid ammonia plant in north-west 
Western Australia.

STATUS: Under construction. 

Good Earth Green 
Hydrogen and 
Ammonia Project 
(Hiringa Energy), 
New South 
Wales119

Green ammonia

2023

2027

Est. $71.6 million 
including 
$35.8 million 
of funding through 
the New South 
Wales Hydrogen 
Hubs initiative.

Aims to produce up to 4,500 tonnes of green 
ammonia annually to supply local and regional 
farming operations as a low-carbon fertilizer. 

STATUS: Under construction.

Allied Green 
Ammonia Project 
(Allied Green), 
Northern Territory

Green ammonia

2023

2030

Est. $10 billion120

Proposed green ammonia facility on the Gove 
Peninsula producing up to 958,500 tonnes of 
green ammonia for export.121

STATUS: Project feasibility and 
pre‑FEED studies completed in 2024. 
Preliminary design package finalised 
in Jan 2025. FEED studies underway. 





Internationally, low-carbon urea production using DAC or 
PSC CO2 has not yet been demonstrated at a commercial 
scale, but there are emerging examples of industrial-scale 
green ammonia synthesis, for example:

• Chinese company Envision commissioned a 320,000 tpa 
green ammonia plant at Chifeng Net Zero Industrial Park 
in Inner Mongolia in 2025. 
• The EU’s first industrial-scale green ammonia and 
renewable hydrogen plant by Fertiberia (Spain) is under 
development to produce 180,000 tpa of ammonia.122 
• Yara’s renewable Hydrogen plant in Norway, 
established in 2023, can produce up to 20,000 tpa 
of green ammonia.123


118 CSIRO (2025) HyResource: Yuri Renewable Hydrogen to Ammonia Project. <https://research.csiro.au/hyresource/yuri-renewable-hydrogen-to-ammonia-
project/>

.

119 CSIRO (2025) HyResource: Good Earth Green Hydrogen and Ammonia Project. <https://research.csiro.au/hyresource/good-earth-green-hydrogen-and-
ammonia-project/>. 

120 Allied Green Ammonia (2025) Affinity Capital appointed for flagship green ammonia project. <https://renewablesnow.com/news/aga-seeks-to-raise-usd-6-
5bn-for-major-aussie-green-ammonia-project-868587/>.

121 Allied Green Ammonia (2025) ABB and Allied Green Ammonia sign MOU to accelerate the energy transition. <https://new.abb.com/news/detail/124309/
abb-and-allied-green-ammonia-sign-mou-to-accelerate-the-energy-transition-with-green-hydrogen-and-ammonia>.

122 Fertiberia (n.d.) GAIA: Green Ammonia in Asturias. <https://www.fertiberia.com/en/greenammonia/gaia-green-ammonia-in-asturias/>.

123 Yara (n.d.) Renewable hydrogen plant at Herøya (Press Kit). <https://www.yara.com/news-and-media/media-library/press-kits/renewable-hydrogen-plant-
heroya-norway/>. 



Industry insights

Stakeholder consultations and desktop research identified 
the following industry insights:

• Urea is a globally traded commodity and Australian 
urea projects must compete with low-cost gas imports 
from the Middle East and East Asia. The closure of 
Dyno Nobel’s Gibson Island Plant due to high gas 
prices and ageing infrastructure, the discontinuation 
of Strike Energy’s Project Haber proposal due to gas 
resource limitations, and the delays to NeuRizer’s Urea 
proposal due to the loss of a strategic partner and 
a requirement to prepare an Environmental Impact 
Statement highlight diverse challenges associated 
with conventional urea production in Australia. In this 
already challenging environment for conventional 
urea production, low‑carbon urea is expected to face 
even greater challenges. In the absence of effective 
global carbon pricing and carbon leakage mechanisms, 
Australian low‑carbon urea manufacturers will have to 
compete directly with conventional urea imported from 
countries with no carbon price. This likely explains why, 
the conventional urea industry is currently focused on 
deploying CCS and renewable hydrogen integration 
(for hybrid production) to reduce the emissions intensity 
of natural gas derived urea rather than developing urea 
production facilities using PSC or DAC CO2 feedstocks. 
• Green ammonia production and secure CO2 supply 
are essential precursors to commercial scale 
low‑carbon urea production. As such, it is unlikely 
for commercial‑scale projects to be seriously pursued 
by Australian industry until green ammonia projects 
are successfully deployed. Like all CO2 utilisation 
applications, it also requires a secure supply of CO2, 
which in the absence of CO2 capture and distribution 
infrastructure creates a significant geographic constraint. 
Aligning both supply chains adds complexity and risk at 
early commercial stages, which can make it much harder 
to secure offtake agreements and financing. Hybrid urea 
production (combining renewable hydrogen feedstock 
and conventional urea production) may offer a nearer 
term opportunity for emissions intensity reductions in 
the urea industry.
• Capital intensity and financing risk remain central 
barriers to project realisation. Perdaman’s Project Ceres 
may suggest important factors for the success of future 
low-carbon urea projects, including offtake agreements, 
supportive finance arrangements, and federal 
government support. Project Ceres is a conventional 
urea manufacturing plan under development in 
Karratha, Western Australia. Factors in its success are 
likely to include a 20-year gas supply agreement with 
Woodside, an offtake partnership entered with Dyno 
Nobel (prior to the sale of its fertiliser distribution 
business to Ridley Corporation), and government loans 
to support the development of the project ($220m) and 
related infrastructure ($255m) via the Northern Australia 
Infrastructure Fund.124


124 NAIF (Northern Australia Infrastructure Facility) (2022) Perdaman Urea Project and supporting infrastructure. <https://www.naif.gov.au/our-projects/
perdaman-urea-project-and-supporting-infrastructure/>.



2050 market assessment

Scope of analysis 

This analysis assesses the potential demand for urea 
derived using PSC and DAC CO2 sources in a simplified 
2050 domestic fertiliser market. The two low-carbon urea 
products are compared against conventional urea produced 
from fossil-based methane via incumbent processes.

The methodology, assumptions and results of this analysis 
are described in detail in Appendices A.2 and A.5.

Table 9: Assessed and reference urea product descriptions

PRODUCT

DESCRIPTION

ASSESSED 
PRODUCTS

Urea (PSC)

Urea produced using green ammonia (synthesised from renewable hydrogen and 
atmospheric nitrogen) and CO2 captured from industrial point source emissions. 

Urea (DAC)

Urea produced using green ammonia (as above) and CO2 captured via Direct Air 
Capture (DAC).

REFERENCE 
PRODUCT

Conventional 
urea

Fossil-based urea produced using hydrogen and CO2 derived from natural gas reforming, 
via a conventional ammonia synthesis pathway.





Cost competitiveness

The modelled LCOP and CO2 emissions cost for urea 
products in each scenario is shown in Figure 11. Under all 
modelled scenarios, green urea produced using point 
source CO2 is projected to be cost competitive with 
the conventional urea product. Urea synthesised from 
DAC was not found to be competitive under either 
scenario, reflecting substantially higher production 
costs. These elevated costs are primarily attributable to 
the expense of the carbon feedstock, which remains a 
dominant cost driver in DAC-based urea production.

The cost of both PSC and DAC-derived urea, could be 
further reduced if hydrogen prices were to become 
much lower than currently estimated (≤$1.8/kg).

Figure 11: LCOP and CO2 emission costs for urea products in 2050

Demand

The modelled domestic demand for the urea in each 
scenario is shown in Figure 12. Forecast demand modelling 
indicates that urea produced from point source CO2 
captures the entirety of projected domestic demand under 
both low‑and high-ambition scenarios. 

This outcome reflects relative cost competitiveness, while 
neither DAC‑based urea nor conventional urea capture 
any market share. No limiting production constraints 
were identified for PSC‑based urea within the modelling 
framework, as feedstocks were assumed to be scalable 
in line with demand. It should be noted, however, 
that this suggests unconstrained renewable hydrogen 
and CO2 availability, which in practice may influence 
production capacity and market uptake. 

Figure 12: Modelled demand for urea products in 2050 

Economic benefits, CO2 utilisation 
and abatement potential 

Urea (PSC) shows potential for CO2 utilisation, with 
2.1 million tonnes of CO₂ use forecast under both scenarios. 
If reliable sources and industry uptake of PSC CO2 cannot 
be secured, this could limit the supply of urea (PSC). If this is 
the case, the modelling results suggest that under the low 
ambition scenario, conventional urea would capture the 
remaining demand, but in the high ambition scenario, urea 
(DAC) is found to become competitive. 

If Australian industry supplies the forecast domestic 
demand for urea (PSC), the modelling estimates 
domestic revenue of $1.6 billion and employment 
potential of 976 jobs in 2050, approximated using 
the employee‑to‑revenue benchmark for the fertiliser 
manufacturing industry in Australia.

If urea production continues to rely on conventional 
fossil‑based pathways, meeting the projected 2050 
demand of 2.7 Mt could result in an estimated 3.1 Mt 
of CO2 emissions.125 If this demand is replaced by urea 
(PSC), the associated CO2 emissions would be reduced 
by 2.1 MtCO2 per annum (a reduction of 68%).


125 The well-to-wake emissions for conventional urea are estimated at 1.14 tCO₂ per tonne of product. See Appendix A5 for further details. 



3.4 Mineral aggregates

VALUE IN 2050

By 2050, the production of carbonated fine 
aggregates for use in concrete could create 
an estimated:

$130 million 
revenue

200 
jobs

Abating 
150 ktpa 
CO2 emissions

DOMESTIC DEMAND IN 2050

Under both 
scenarios

Conventional 
concrete 
blend 
96.8 Mt 
92%

Concrete blend 
with carbonated 
fine aggregates 
8.35 Mt* 
8%

*containing 2.1 Mt of 
carbonated aggregate

CURRENT ACTIVITY

Mineral carbonation 
demonstration plant 

1 Project

Carbonated limestone 
aggregates 

1 Project

Note: These results are based on analysis of a non-exhaustive selection of CO2 utilisation pathways and feedstocks for mineral aggregate production: 
carbonated fine aggregates produced from steel slag and waste concrete. 

Background

Carbonated mineral aggregates are construction-grade 
materials produced by reacting CO2 with alkaline minerals 
or industrial residues.126 Carbonated aggregate products 
have the potential to be used as low emission alternatives 
to quarried rock and sand used in concrete, pre-cast 
construction products, road bases, and other building 
materials. Their physical and mechanical properties, such 
as strength and durability, are expected to be able to meet 
construction standards when properly engineered. 

Carbonated aggregates may assist with decarbonisation 
efforts in the construction sector, particularly in response 
to rising scrutiny of embodied scope 3 emissions.127 
In Australia, scope 3 emissions from the built environment 
were estimated to be 10% of national carbon emissions 
in 2023.128 Other analyses suggest concrete alone is 
responsible for approximately 11 MtCO2 per year.129 

Carbonated aggregates can be durable stores of carbon, 
making them a carbon-negative product. This contrasts 
with CO₂-derived chemicals and fuels, which are typically 
short-term stores of carbon. Carbonated mineral aggregates 
support a shift toward low-carbon construction practices, 
which will be increasingly important as demand for new 
housing and infrastructure increase, driven by population 
growth and national infrastructure targets.

Carbonated mineral aggregates (and carbonated SCMs, 
see Section 3.5) are examples of mineral carbonation 
products that can be made using CO2 utilisation. 
Some other mineral carbonation products are discussed 
briefly in Section 3.6 and there is a broader discussion in the 
CSIRO CO2 Utilisation Roadmap.130 Because of the potential 
long-term durability of carbonates, mineral carbonation 
processes are also being explored for their potential in 
CCS and CDR applications. 

126 Zhang T, Chen M, Wang Y, Zhang M (2023) Roles of carbonated recycled fines and aggregates in hydration, microstructure and mechanical properties of 
concrete: A critical review. Cement and Concrete Composites 138, 104994. <https://doi.org/10.1016/j.cemconcomp.2023.104994>.

127 Emissions generated throughout the lifecycle of a product from extraction of raw material resources through to extraction, including from manufacture, 
transport, construction and end-of-life processes.

128 Infrastructure Australia (2024) Embodied carbon projections for Australian infrastructure and buildings. <https://www.infrastructureaustralia.gov.au/reports/
embodied-carbon-projections-australian-infrastructure-and-buildings>.

129 Climate Change Authority (2024) Sector pathways review: Built environment. <https://www.climatechangeauthority.gov.au/sites/default/files/
documents/2024-09/2024SectorPathwaysReviewBuilt%20Environment.pdf>.



Industry status

The production of carbonated mineral aggregates in Australia is approaching commercial scale. MCi Carbon (Australia) 
has developed a mineral-carbonation process for industrial residues and quarried materials, and commenced operation 
of the Myrtle demonstration plant on Kooragang Island, NSW in November 2025. O.C.O Technology (UK) is also developing 
a mineral carbonation project in Victoria utilising emissions from the proposed Maryvale Energy Waste facility.

Table 10: Active and announced mineral carbonation projects in Australia

PROJECT 

ANNOUNCEMENT 
DATE

EXPECTED YEAR 
OF OPERATION

FUNDING

DESCRIPTION

Myrtle 
Demonstration 
Plant 
(MCi Carbon), 
New South Wales

2022

2025

Est. $29m 
including $14.6m 
in Australian 
Government 
grants.131 

MCi Carbon’s Myrtle demonstration plant 
will use up to 1,000–3,000 tCO₂/yr from 
Orica’s Kooragang Island to produce low 
carbon materials.132 For slag-based feedstocks 
(post‑upgrades) the system can process up 
to ~2,500 tCO₂ per year, producing up 
to ~12,500 t/yr of carbonated products. 
Myrtle provides a platform for advancing mineral 
carbonation process engineering and evaluating 
the integration of different waste feedstocks.

STATUS: Commenced operations 
in November 2025.

O.C.O Technology 
plant at Maryvale 
Energy from 
Waste facility, 
Victoria

2022

2029

Est. $16.3m (£8m)

O.C.O Technology (UK) has entered into a 
partnership to build a purpose-built facility 
adjacent to the Maryvale Energy from Waste 
operation being developed by Veolia. This facility 
will treat Flue Gas Treatment residues from the 
operation with CO2 to create carbon negative 
manufactured limestone aggregate for the 
construction sector. In 2024, O.C.O technology 
imported 40 t of its limestone aggregate to 
Australia to demonstrate its use in the production 
of concrete blocks.

STATUS: In 2024, O.C.O Technology was 
granted a Development License and 
commenced geotechnical work.133 





130 Srinivasan V, Temminghoff M, Charnock S, Moisi A, Palfreyman D, Patel J, Hornung C, Hortle A (2021) CO₂ Utilisation Roadmap. CSIRO, Australia.

131 MCi Carbon secured a $14.5M Carbon Capture Technology Grant from DCCEEW in 2024 and a $14.6M CCUS Demonstration Fund Grant from DISR/DCCEEW 
in 2021: MCi Carbon (2024) Submission to the Productivity Commission: Circular economy. <https://www.pc.gov.au/__data/assets/pdf_file/0005/387545/
sub119-circular-economy.pdf>.

132 MCi Carbon (2024) Myrtle foundation for global industrial decarbonisation. <https://mcicarbon.com/mci-carbon-lays-foundation-for-global-industrial-
decarbonisation/>.

133 O.C.O Technology (2024) First O.C.O blocks made in Australia. <https://oco.co.uk/first-o-c-o-blocks-made-in-australia/>.



Internationally, carbonated mineral aggregates have been 
demonstrated in a variety of applications but are yet to 
transition to commercial-scale projects. There are currently 
several pilot and demonstration scale projects announced 
or operating, including:

• Blue Planet Systems (US) has demonstrated synthetic 
limestone aggregate in concrete. It’s San Francisco 
Bay Global Innovation Center is operating and being 
expanded to a design target of ~5,000 tCO₂/yr and 
~11,000 t/yr of aggregate (current operational capacity 
not disclosed).134
• Carbon8 Systems (UK) provides a containerised 
mineral‑carbonation unit, with a capture range of 
~1,500–4,000 tCO₂/yr (and up to ~24,000 t/yr residues 
treated per modular system). Deployments include Vicat 
(France) and a pilot at AVR Duiven (Netherlands).135
• O.C.O Technology (UK) operates three mineral 
carbonation facilities in the UK using Accelerated 
Carbonation Technology to treat thermal residues 
with CO₂, producing manufactured limestone 
(M‑LS) aggregate (current per-plant CO₂ capture 
rate not disclosed).136 
• Resilco (Italy) raised €5 million of funding in 2025 to 
build a mobile mineral carbonation plant in 2026 and 
develop Italy’s first industrial mineral carbonation plant 
in 2027 (current plant capacity not disclosed).137


Industry insights

Stakeholder consultations and desktop research identified 
the following industry insights:

• As a volume-driven commodity with highly localised 
markets, commercial success will be dependent on 
the scale and integration with both feedstock supply 
and product distribution chains. Aggregates are a 
volume‑driven commodity, required in high volumes 
with a relatively low unit value. Moreover, they are 
typically supplied through highly localised supply 
chains, where transport costs dominate. Therefore, 
achieving large-scale penetration will be dependent 
on proximity to key markets and integration with 
existing construction logistics, as well as plant capacity. 
Vertical integration in the construction sector further 
complicates adoption of low-carbon alternatives. 
Already, many downstream concrete manufacturers 
choose to adopt manufactured sands as aggregates to 
minimise quarry waste from upstream mining activities 
and avoid disposal costs. As such, the economic 
prospects of low carbon carbonated aggregates must 
also account for the external factors associated with the 
change of materials, including interplay with existing 
supply and waste disposal value chains. However, some 
technologies, including MCi Carbon’s, can support full 
circularity which helps reduce these logistical barriers.
• Feedstock flexibility is a strength, but supply chains 
are uncertain. MCi Carbon has successfully trialled 
carbonation across a range of alkaline residues, including 
mine tailings and industrial by-products such as waste 
concrete and steel slag. Managing supply side risk for 
feedstock materials will be a critical enabling factor for 
mineral aggregate products that use waste feedstocks.


134 Blue Planet Systems (2025) Carbon capture & utilization pioneer announces world’s first net zero concrete placement using synthetic limestone aggregate. 
Press Release. <https://www.newswire.com/news/carbon-capture-utilization-pioneer-blue-planet-announces-worlds-first-22518347>.

135 Carbon8 (n.d.) Our Solution. <https://www.carbon8.co.uk/solution>.

136 O.C.O Technology (2025) O.C.O Technology’s King’s Award for Enterprise milestone celebration. Agg-Net, 16 May. <https://www.agg-net.com/resources/
articles/decarbonization/oco-technologys-kings-award-for-enterprise-milestone-celebration>.

137 CDP Venture Capital (2025) Investment announcement. <https://www.cdpventurecapital.it/cdp-venture-capital/en/dettaglio_comunicato.
page?contentId=COM3847>.



2050 market assessment

Scope of analysis 

Carbonated fine aggregates are a potential substitute for 
sand in concrete that could help to reduce the emissions 
intensity of concrete products. To explore the economic 
viability of carbonated aggregates in this application, this 
analysis assesses the potential demand for carbonated 
fine aggregates in a simplified pre-mixed concrete market. 
It considers two N25138 concrete blends: a conventional 
formulation, and one in which sand is replaced with 
carbonated fine aggregate, produced with flue gas CO2. 
This report models mineral aggregates produced from steel 
slag waste and concrete waste (recycled concrete fines) 
only. Mineral carbonation products produced using other 
feedstocks (e.g. serpentinite) are not in scope of this analysis.

For the purposes of this analysis, the modelled carbonated 
fine aggregate product is assumed to meet the technical 
performance specifications for concrete aggregates, 
though this has not yet been fully validated. 

The methodology, assumptions and results of this analysis 
are described in detail in Appendices A.2 and A.6.

Table 11: Assessed and reference concrete product descriptions

PRODUCT

DESCRIPTION

ASSESSED 
PRODUCT

Concrete blend 
with carbonated 
fine aggregate

A concrete blend comprised of Ordinary Portland Cement (OPC) (25%), coarse aggregate 
(50%) and carbonated fine aggregate (25%). The carbonated fine aggregate product contains 
manufactured sand and raw limestone and is produced by reacting waste steel slag and/
or concrete feedstocks with CO₂ capture from industrial flue gas. The carbonated fine 
aggregate replaces sand in the conventional concrete blend.

REFERENCE 
PRODUCT

Conventional 
concrete blend

A concrete blend comprised of OPC (25%), coarse aggregate (50%) and sand (25%).





Cost competitiveness

The modelled LCOP and CO2 emissions cost for concrete 
blends in each scenario is shown in Figure 13. The blend 
containing carbonated fine aggregate is projected to be 
cost competitive with the conventional concrete blend in 
both low- and high-ambition scenarios. Modelled costs 
for the carbonated fine aggregate blend assume that steel 
slag and concrete waste products are obtained at zero 
cost as industrial by-products. This represents a best‑case 
condition. Limited feedstock availability, competing end 
uses, and the dispersed geographical distribution of 
steelmaking and concrete manufacturing operations are all 
likely to influence costs, and could erode this assumption, 
particularly where transport or processing requirements 
are significant. 

Figure 13: LCOP and CO2 emission costs for concrete blend products in 2050

138 N25 is a common concrete grade with a compressive strength rating of 25 MPa, it is produced with a ratio of 1:1:2 (i.e. one part cement, one part sand, 
and two parts coarse aggregate)



Demand

The modelled domestic demand for the concrete blends 
in each scenario is shown in Figure 14. Concrete blends 
containing carbonated aggregates are constrained by 
feedstock availability, limiting their contribution to 
approximately 8.3 Mtpa of total demand across both 
scenarios. As shown in Figure 13, the cost modelling 
indicates concrete blends containing carbonated aggregates 
are likely to be competitive with the conventional blend. 
However, their supply is constrained by the availability 
of steel waste slag and waste concrete. Assuming that 
50% of steel slag waste139 and 20% of concrete waste140 
generated in Australia is allocated to carbonated fine 
aggregate production, the total production of carbonated 
fine aggregates is constrained to around 2.1 Mtpa in 2050. 
This corresponds to a maximum supply limit of 8.3 Mtpa of 
the concrete blend with carbonated fine aggregate; well 
under the total demand projected in 2050. The residual 
demand is met by the conventional concrete blend. 

Figure 14: Modelled demand for concrete blend products in 2050

Economic benefits, CO2 utilisation 
and abatement potential 

If Australian industry supplies the forecast domestic 
demand for carbonated fine aggregates, the modelling 
estimates domestic revenue of $131 million and employment 
potential of 202 jobs in 2050, approximated using the 
employee-to-revenue benchmark for the rock, limestone 
and clay mining manufacturing industry in Australia.

Carbonated fine aggregates show potential for total CO2 
utilisation, with 0.16 MtCO2 use forecast in both scenarios. 
It is assumed that 90% of the utilised CO2 remains stored 
in carbonated fine aggregates. For the projected 8.3 Mt 
demand of concrete blend with carbonated fine aggregates, 
this represents an estimated 142,000 tonnes of CO2 stored. 
The use of this volume of carbonated aggregate as a sand 
substitute in concrete has potential to abate an estimated 
0.15 Mt of CO2 per annum.


139 It is assumed that the 26% of steel slag output that is currently sent to landfill could be utilised for mineral carbonation, and 50% of this is allocated to 
carbonated fine aggregates production. See Appendix A.6 for more details. 

140 It is assumed that a 20% of waste concrete in Australia can be recovered and used for carbonated fine aggregate production, considering other competing 
recycling usage and material utilisation compliance. Further analysis to improve the accuracy of this figure is recommended to validate the scale of this 
opportunity. See Appendix A.7 for more details.



3.5 Supplementary cementitious materials (SCMs)

VALUE IN 2050

By 2050, the production of carbonated 
steel slag SCMs for use in cement blends 
could create an estimated:

$12 million 
revenue

10 
jobs

Abating 
40 ktpa 
CO2 emissions

DOMESTIC DEMAND IN 2050

Under both 
scenarios

Cement blend with 
conventional 
SCMs
14.2 Mt 
95%

Cement blend 
with carbonated 
SCMs
0.75 Mt* 
5%

*containing 0.15 Mt 
of carbonated SCM

CURRENT ACTIVITY

Carbonated SCM 

1 Project 
Demonstration plant

Note: These results are based on analysis of a non-exhaustive selection of CO2 utilisation pathways and feedstocks for SCM production: carbonate SCMs 
produced from waste steel slag.

Background

Supplementary cementitious materials (SCMs) are reactive 
inorganic materials used to replace a portion of cement 
in concrete mixtures, either by partially replacing clinker 
in cement or by directly substituting cement in the 
concrete mix. Modern blended cements often contain 
20–35% SCMs, although proportions may vary depending 
on the type of concrete and other factors.141 

SCMs approved for use in Australia include fly ash 
(a by‑product of coal-fired power generation), ground 
granulated blast furnace slag (GGBFS, derived from 
steelmaking), and silica fume (a byproduct of silicon and 
ferrosilicon alloy production).142 These materials are largely 
sourced from industrial waste streams and are blended with 
cement to produce concretes that can exhibit properties 
for dedicated applications (i.e., improve durability, strength 
development, and long-term chemical resistance). Their use 
can also have environmental benefits including the 
reduction of the emissions intensity of the cement blends. 

Cement production generates around 0.6 tCO₂ per tonne 
of cement,143 and contributes approximately 7–8% of global 
CO₂ emissions.144 In Australia, the cement industry emitted 
approximately 4.7 MtCO₂ in 2020–21.145 This primarily arises 
from the calcination of limestone and fossil fuel combustion 
during clinker production. Carbonated SCMs, produced via 
mineral carbonation of alkaline waste, provide a potential 
pathway to reducing the embodied emissions in concrete. 
Carbon embodied SCMs are yet to be commercialised 
for use in the cement and concrete industry, however, 
these products hold potential for emissions reductions 
and circular-material innovation if performance and cost 
targets are met.

141 ASTM International (2025) ASTM C595/C595M – Standard specification for blended hydraulic cements. <https://www.astm.org/c0595_c0595m-21.html>.

142 CCAA (Cement Concrete & Aggregates Australia) (2020) Supplementary cementitious materials – GTCC Part II-2. <https://www.ccaa.com.au/common/
Uploaded%20files/CCAA/Publications/Technical%20Publications/PART_II_-2-_SUPPLEMENTARY_CEMENTITIOUS_MATERIALS_GTCC_2020.pdf>.

143 International Energy Agency (2025) Cement industry overview. <https://www.iea.org/energy-system/industry/cement>. 

144 Cement Industry Federation (2021) Decarbonisation pathways for the Australian cement and concrete sector. <https://cement.org.au/wp-content/
uploads/2021/10/Decarbonisation_Pathways_Australian_Cement_and_Concrete_Sector.pdf>.

145 CSIRO (2023) CCUS roadmap for low emission cement and lime production. <https://www.csiro.au/en/news/All/Articles/2023/November/CCUS-Roadmap>.



Carbonated SCMs are formed via a process of mineral 
carbonation, involving the reaction of CO₂ with alkaline 
industrial residues, such as steel slag. This reaction 
produces stable carbonates which can then be tailored 
for use in cement blends as a partial clinker replacement, 
depending on particle size and chemical composition. 
Products of mineral carbonation processes such as 
amorphous silica are also being explored for their suitability 
for use as an SCM. Some other mineral carbonation 
products are discussed briefly in Section 3.6 and there is a 
broader discussion in the CSIRO CO2 Utilisation Roadmap.146 
Because of the potential long-term durability of carbonates, 
mineral carbonation processes are also being explored for 
their potential in CCS and CDR applications. 

Industry status

In Australia, the use of carbonated SCMs is the subject of 
ongoing research and testing. MCi Carbon has positioned 
SCMs as a strategic output of its carbonation activities, 
alongside carbonated mineral aggregates (see Section 3.4). 
They are currently investigating the integration of 
amorphous silica, created as a product of their mineral 
carbonation process, and carbonated steel slag as potential 
SCMs, with their Myrtle demonstration plant capable of 
kiloton-scale SCM production. While in the research trial 
phase, this work highlights a pathway for diversifying SCM 
sources beyond traditional industrial by-products.

Table 12: Active carbonated SCM projects in Australia

PROJECT 

ANNOUNCEMENT 
DATE

FUNDING

DESCRIPTION

Myrtle 
Demonstration 
Plant 
(MCi Carbon), 
New South 
Wales

2022

Est $29m 
including 
$14.6m in 
Australian 
Government 
grants.147 

MCi Carbon’s Myrtle demonstration plant will use up to 1,000–3,000 tCO₂/yr 
from Orica’s Kooragang Island to produce low carbon materials.148 
For slag‑based feedstocks (post-upgrades) the system can process up to 
~2,500 tCO₂ per year, producing up to ~12,500 t/yr of carbonated products. 
Myrtle provides a platform for advancing mineral carbonation process 
engineering and evaluating the integration of different waste feedstocks.

This plant has capability of producing SCM from the amorphous silica product 
of their mineral carbonation process. 

STATUS: Commenced operations in November 2025.





146 Srinivasan V, Temminghoff M, Charnock S, Moisi A, Palfreyman D, Patel J, Hornung C, Hortle A (2021) CO₂ Utilisation Roadmap. CSIRO, Australia.

147 MCi Carbon secured a $14.5M Carbon Capture Technology Grant from DCCEEW in 2024 and a $14.6M CCUS Demonstration Fund Grant from DISR/DCCEEW 
in 2021: MCi Carbon (2024) Submission to the Productivity Commission: Circular economy. <https://www.pc.gov.au/__data/assets/pdf_file/0005/387545/
sub119-circular-economy.pdf>.



Internationally, research into CO₂-derived SCMs is 
accelerating but commercial deployments remain 
limited. Projects in North America, Europe and Asia have 
demonstrated partial substitution of Portland cement with 
carbonated SCMs. Identified carbonated SCM research and 
demonstration projects include:

• RHI Magnesita (Austria) is testing the scale-up of 
MCi Carbon (Australia) mineral carbonation technology 
in preparation for a planned commercial scale 
deployment in 2028 at RHI Magnesita’s refractory in 
Austria that would utilise an estimated 50,000 tCO₂ 
per year to produce SCMs (amorphous silica) and 
magnesium carbonate.149
• Ash Grove Carbon 1 Mississauga project (Canada) 
will use point source CO2 from Ash Grove’s cement plant 
in Ontario, combined with landfilled coal ash, iron and 
steel slag, and clays. Once operational (targeting 2026), 
the facility will have the capacity to produce up to 
30,000 t of SCMs annually.150
• TITAN Group (Greece-based) is advancing SCM sourcing 
and processing across the United States, United 
Kingdom, Turkey, Greece (partnership with Ecocem) and 
India (partnership with JAYCEE). These ventures focus 
on deploying conventional SCM routes such as calcined 
clay, pozzolana, ponded fly ash, and slag, tied to local 
feedstock availability.151 Separately, Titan’s American 
subsidiary is exploring CO2 enabled mineral upcycling 
in collaboration with Carbon Upcycling Technologies, 
and engaging in discrete carbon capture activities which 
could supply CO2 for future carbonated SCM routes.152
• Paebbl (Netherlands) began operating a continuous 
demonstration plant using silicate-rich minerals 
in 2025. The project is intended to become the world’s 
fastest continuous production plant storing up to 
500 tCO2 per year.153
• Solidia (US) produces a synthetic low-lime carbonated 
calcium silicate clinker feedstock that is converted 
into an SCM.154 In 2023, the company expanded the 
capacity at their Texas headquarters, reaching around 
1000 t per year for pilot-scale production. 
• Asia Cement (Taiwan/South Korea) is developing the 
production of carbonated SCMs.155 In parallel, through 
its South Korean operations, the company is now 
developing supplementary cementitious feedstocks with 
captured CO2, cement kiln dust and by-pass particles. 
The company is targeting an initial capture of 
30,000 tCO2 per year, expanding to 180,000 tCO2 per 
year through the CCUS project.156


148 MCi Carbon (2024) MCi Carbon lays foundation for global industrial decarbonisation. <https://mcicarbon.com/mci-carbon-lays-foundation-for-global-
industrial-decarbonisation/>.

149 RHI Magnesita (2025) CCUpScale project: RHI Magnesita and MCi Carbon move closer to world’s first CCU plant. <https://www.rhimagnesita.com/en/
ccupscale-project-rhim-and-mci-carbon/>.

150 Carbon Upcycling Technologies (2025) Carbon Upcycling and Ash Grove break ground on Canadian first-of-its-kind carbon capture and utilization facility. 
<https://carbonupcycling.com/2025/07/29/carbon-upcycling-and-ash-grove-break-ground-on-canadian-first-of-its-kind-carbon-capture-and-utilization-
facility/>.

151 World Cement (2025) Ecocem signs agreement with TITAN Group to accelerate the deployment of low-carbon cement. <https://www.worldcement.com/
europe-cis/03042025/ecocem-signs-agreement-with-titan-group-to-accelerate-the-deployment-of-low-carbon-cement/>; TITAN Group (2025) TITAN Group 
expands global reach of low-carbon building materials with cementitious venture in India. <https://ir.titanmaterials.com/uploads/announcements/2025/
tci_media_release_13022025.pdf>

152 TITAN Group (2025) TITAN and Carbon Upcycling forge strategic partnership to develop low-carbon construction materials. <https://www.titanmaterials.
com/wp-content/uploads/2025/06/04062025_TITAN_and_Carbon_Upcycling-forge_strategic_partnership_EN.pdf>.

153 Paebbl (2025) Paebbl starts operating its continuous demo plant, a world-first for CO₂ mineralisation. <https://paebbl.com/news-feed/paebbl-starts-
operating-its-continuous-demo-plant-a-world-first-for-co2-mineralisation>.

154 Solidia Technologies (2019) The science behind Solidia. <https://assets.ctfassets.net/jv4d7wct8mc0/5DwEAeEYqsFAYA9UC53EF7/4f8b7566221a8d9cb3
8f970867003226/Solidia_Science_Backgrounder_11.21.19__5_.pdf>.

155 Asia Cement Corporation (n.d.) Low carbon harbors project. <https://esg.acc.com.tw/en/esg_development/environmental/projects/low_carbon_harbors>.

156 Global Cement (2022) TCRK announces carbon capture project with Asia Cement. <https://www.globalcement.com/news/item/14926-tcrk-announces-
carbon-capture-project-with-asia-cement>.



Industry insights

Stakeholder consultations and desktop research identified 
the following industry insights:

• Further development of carbonated SCMs will be 
required prior to commercialisation. Trial results have 
indicated positive performance of embodied products 
in cement and concrete, however, further testing and 
optimisation is required to validate the materials and 
enhance performance.
• Standardisation and regulatory frameworks are a 
barrier to the use of emerging carbonated SCMs. 
Traditional SCMs are well-covered by the AS 3582 series 
of Australian Standards,157 and the introduction of the 
AS 3582.4 in 2022 saw greater expansion of the standards 
to capture manufactured pozzolans (i.e., silica and/or 
alumina-based materials which react readily with lime), 
signalling accommodation of emerging materials.158 
However, concrete supply and performance standards 
may omit guidance on SCM replacement or prescribe 
their use only in certain circumstances, which may limit 
their uptake.159 Beyond compositional limitations, there 
is international momentum toward performance-based 
specifications that focus on end-use functionality over 
fixed compositions, which in Australia is still nascent.160 
• Coordination and integration with Australia’s 
heavy industries may be required to secure suitable 
feedstocks (i.e., steelmaking slag), but long-term 
reliance may present supply challenges. 
Many SCM pathways depend on access to low‑cost 
industrial by-products and wastes that could be 
supplied by Australian heavy industries, particularly 
those already diverting wastes toward the 
construction industry for use in road bases and 
concrete production. However, as feedstock volumes 
decline with the phase out of incumbent technologies 
(i.e., coal-fired power stations and blast furnaces), 
downstream utilisation processes will also be impacted. 
Alternative feedstocks, such as serpentinite, that offer less 
restricted scale opportunities are being investigated.


157 CCAA (Cement Concrete & Aggregates Australia) (2020) Supplementary cementitious materials – GTCC Part II-2. <https://www.ccaa.com.au/common/
Uploaded%20files/CCAA/Publications/Technical%20Publications/PART_II_-2-_SUPPLEMENTARY_CEMENTITIOUS_MATERIALS_GTCC_2020.pdf>.

158 Standards Australia (2022) AS 3582.4:2022 – Supplementary cementitious materials, Part 4: Pozzolans – Manufactured. <https://www.standards-global.com/
wp-content/uploads/pdfs/preview/2246260>.

159 NSW Department of Climate Change, Energy, the Environment and Water (2025) Low carbon concrete: Frequently asked questions. <https://www.energy.
nsw.gov.au/sites/default/files/2025-04/2025%20NSW%20%20A4%20Factsheet_LCC_Frequently%20Asked%20Questions.pdf>; Cement Industry Federation 
(2021) Decarbonisation pathways for the Australian cement and concrete sector. <https://cement.org.au/wp-content/uploads/2021/10/Decarbonisation_
Pathways_Australian_Cement_and_Concrete_Sector.pdf>.

160 IEAGHG (2023) International standards and testing for novel carbonaceous building materials. <https://ieaghg.org/publications/international-standards-
and-testing-for-novel-carbonaceous-building-materials/>.



2050 market assessment

Scope of analysis 

To explore the economic viability of carbonated SCMs 
in cement blends, this analysis assesses the potential 
demand for carbonated SCMs through their utilisation in 
cement‑based products. It considers the use of carbonated 
steel slag, produced with flue gas CO2, as an input to 
blended cement, and compares its uptake against a 
conventional cement blend in a simplified 2050 domestic 
market. This report models only SCMs produced using 
carbonation of steel slag waste, and does not consider 
other SCMs that could be produced using other feedstocks.

For the purposes of this analysis the modelled cement 
blend containing carbonated steel slag is assumed to 
meet the technical performance specifications required 
by commercial cement mixes. 

The methodology, assumptions and results of this analysis 
are described in detail in Appendices A.2 and A.7.

Table 13: Assessed and reference cement product descriptions

PRODUCT

DESCRIPTION

ASSESSED 
PRODUCT

Cement blend 
with carbonated 
SCM

Cement mix comprised of OPC (25%), fly ash (15%), Ground Granulated Blast Furnace Slag, 
GGBFS (40%), and carbonated SCM (20%). The carbonated (steel slag) SCM – produced by 
reacting waste steel slag with CO₂ captured from industrial flue gases – replaces a portion 
traditional non-carbonated SCMs in the conventional cement blend.

REFERENCE 
PRODUCT

Cement blend 
with traditional 
SCMs

Cement mix comprised of OPC (25%) and traditional SCMs – fly ash (25%) and GGBFS (50%).





Cost competitiveness

The modelled LCOP and CO2 emissions cost for cement 
blends in each scenario is shown in Figure 15. The blend 
containing carbonated (steel slag) SCMs are projected 
to be cost competitive compared to the conventional 
cement blend in both low- and high-ambition scenarios. 
Production costs for the carbonated-SCM blend 
assume that steel slag is obtained at zero cost as an 
industrial by‑product. This represents a best-case condition. 
Limited feedstock availability, competing end uses, and 
the dispersed geographical distribution of steelmaking 
operations are all likely to influence costs, and could erode 
this assumption, particularly where transport requirements 
are significant. 

Figure 15: LCOP and CO2 emission costs for cement products in 2050

Demand

The modelled domestic demand for the cement blends in 
each scenario is shown in Figure 16. The modelling results 
found that cements blend incorporating carbonated SCMs 
can be cost-competitive with conventional blends and 
as such they capture market share under both scenarios. 
However, the supply of carbonated SCM is ultimately 
constrained by the limited domestic availability of waste 
steel slag feedstock which is tied to the scale of Australian 
steel production. 

Assuming that 50% of domestic steel slag waste in 2050161 
is allocated to carbonated SCM production, the total 
production of carbonated fine aggregates is constrained to 
an estimated 0.15 Mt in 2050. This corresponds to a supply 
limit of 0.75 Mtpa of the cement blend with carbonated 
SCMs; well under the total demand of 14.9 Mt cement 
blends projected for 2050. The residual demand is met by 
the conventional cement blend. 

Figure 16: Modelled demand for cement products in 2050

Economic benefits, CO2 utilisation 
and abatement potential 

If Australian industry supplies the forecast domestic 
demand for carbonated SCMs, the modelling estimates 
domestic revenue of $12 million and employment potential 
of 9 jobs, approximated using the employee-to-revenue 
benchmark for the cement and lime manufacturing 
industry in Australia. 

Carbonated SCMs show potential for CO2 utilisation, 
with 30,000 tonnes of CO₂ utilisation forecast under 
both scenarios. It is assumed that 90% of the utilised 
CO₂ remains stored in carbonated SCMs. For the 
projected 0.75 Mt demand of the cement blend with 
carbonated SCMs, this represents around 27,000 tpa 
of CO₂ stored. Assuming replacement of the cement 
blend reference product, the use of carbonated SCMs in 
cement blends could abate an estimated 40,000 tonnes 
of CO2 per annum.


161 It is assumed that the 26% of steel slag output that is currently sent to landfill could be utilised for mineral carbonation and 50% of this is allocated to 
carbonated SCMs production.



3.6 Other products

In addition to the five CO₂-derived products modelled 
in this report, several other applications of CO₂ 
utilisation are under development. These emerging 
applications illustrate the diversity of potential 
products and materials that can be derived from 
CO₂ and could be explored in future analysis.

Construction and building materials 

Carbon-cured concrete

In addition to its use as a feedstock for SCMs and aggregates 
in concrete and cement production, CO2 can be injected into 
fresh concrete during mixing and hardening in a process 
called CO2 curing.162 This process enhances the mechanical 
performance and durability of cement-based products. 
During curing, CO₂ reacts with calcium-bearing phases 
in the cement matrix to form calcium carbonate (CaCO₃), 
which fills pore spaces and densifies the microstructure.163 
Two North American companies, CarbonCure (US) and 
Solidia (US), are leading commercial deployment of carbon 
curing technologies, with CarbonCure having licensed over 
800 systems to concrete producers globally, predominantly 
in the United States and Canada.164

While carbon curing is reaching industrial-scale 
deployment, ongoing research is investigating the 
combined effects of SCMs and CO2 curing on cementitious 
materials, including the structural and performance 
impacts of curing on SCMs-blended cement blocks.165 
However, adoption of these products in the near-term is 
likely to be largely constrained to the precast concrete 
market which possesses a more controlled environment 
for curing.166 

162 International Energy Agency (2020) CCUS in clean energy transitions. <https://www.iea.org/reports/ccus-in-clean-energy-transitions>.

163 CSIRO (2023) CO₂ Utilisation Roadmap. <https://www.csiro.au/en/work-with-us/services/consultancy-strategic-advice-services/csiro-futures/energy/co2-
utilisation-roadmap>.

164 CarbonCure Technologies (2024) CarbonCure marks 50 million cubic yards milestone. <https://www.carboncure.com/news/carboncure-marks-50-million-
cubic-yards-milestone/>; CarbonCure Technologies (n.d.) Research and testing data. <https://www.carboncure.com/audience/research-testing-data/>.

165 Song Q, Guo M-Z, Gu Y, Ling T-C (2023) CO₂ curing of SCMs blended cement blocks subject to elevated temperatures. Construction and Building Materials 
374, 130907. <https://doi.org/10.1016/j.conbuildmat.2023.130907>.

166 RMI (Rocky Mountain Institute) (2021) Concrete solutions guide. <https://rmi.org/wp-content/uploads/2021/08/ConcreteGuide5.pdf>.



Plasterboard, flooring material and paint fillers

Mineral carbonation can be used to produce carbonate 
fillers for a wide range of construction products beyond 
cement and concrete, such as plasterboards, wall panels, 
flooring materials and paints and coatings. These products 
offer a means of carbon storage alongside performance 
benefits such as fire resistance, density control and 
durability, while also reducing reliance on mined materials.

Traditionally, plasterboard production relies on gypsum 
(calcium sulphate dihydrate) as the base material, sourced 
either from natural deposits or as an industrial by-product. 
Magnesium carbonate and its hydrated forms are being 
increasingly investigated as alternative fillers, particularly 
due to their fire resistance and thermal stability.167 
These materials can be produced through the carbonation 
of serpentinite or other magnesium-rich feedstocks with 
the potential to reduce reliance on mined materials as well 
as store CO2. However, the gypsum-based plasterboard 
market is well established, with the global market share 
of magnesium-based boards being substantially smaller.168 
Further work is also required to understand how mineral 
carbonates affect the microstructure, strength and blend 
ratios of their plaster products.169

Similarly, flooring materials such as vinyl, linoleum and 
polymer-based composite flooring typically incorporate 
finely ground calcium carbonate to control mechanical 
strength, density and wear resistance.170 Paints and coatings 
often incorporate finely ground mineral fillers, such as 
calcium carbonate, to improve opacity, durability, viscosity, 
and weather resistance.171 CO2-derived alternatives could 
serve as a direct substitute for quarried limestone in 
these applications and reduce overall carbon intensity. 
MCi Carbon is investigating the technical and commercial 
feasibility of many of these applications. 

Across these applications, the low cost of traditional 
quarried materials poses challenges to the adoption of 
CO2-derived fillers,172 as does manufacturer uncertainty 
driven by a lack of large-scale demonstrations to validate 
performance and feasibility in practice.173

Carbonate minerals are also widely used in glassmaking 
and refractory materials. In these applications the CO₂ 
is generally re-released during processing and therefore 
these pathways do not represent permanent CO₂ utilisation. 
However, there is an opportunity for integration of circular 
processes that can restrict the re-release of CO₂ and create a 
permanent release and recapture loop.

167 Shahid K, Nguyen H, Unluer C, Kinnunen P (2024) Development of alternative for gypsum-based plaster using magnesium carbonates from carbon capture 
and utilization process. Construction and Building Materials 447, 137999. <https://doi.org/10.1016/j.conbuildmat.2024.137999>.

168 Estimates suggest the global gypsum board market reached USD $13.73b in 2024, compared to USD $1.72m for the magnesium oxide board market. 
See Fortune Business Insights (2025) Gypsum board market size, share & industry analysis, 2025–2032. <https://www.fortunebusinessinsights.com/gypsum-
board-market-102718> and Fortune Business Insights (2025) Magnesium oxide boards market size, share & regional forecast, 2023–2030. <https://www.
fortunebusinessinsights.com/magnesium-oxide-boards-market-103006>.

169 Shahid K, Nguyen H, Unluer C, Kinnunen P (2024) Development of alternative for gypsum-based plaster using magnesium carbonates from carbon capture 
and utilization process. Construction and Building Materials 447, 137999. <https://doi.org/10.1016/j.conbuildmat.2024.137999>.

170 OECD (Organisation for Economic Co-operation and Development) (2021) OECD Guidelines for Multinational Enterprises: Responsible business conduct for 
climate. <https://one.oecd.org/document/ENV/CBC/MONO(2021)33/en/pdf>.

171 ACCM (n.d.) Introduction: The importance of calcium carbonate in the paint industry for quality and cost efficiency. <https://accm.com.eg/introduction-the-
importance-of-calcium-carbonate-in-the-paint-industry-for-quality-and-cost-efficiency/>

172 Olfe-Kräutlein B, Strunge T, Chanin A (2021) Push or pull? Policy barriers and incentives to the development and deployment of CO₂ utilization, in particular CO₂ 
mineralization. Frontiers in Energy Research 9, 742709. <https://www.frontiersin.org/journals/energy-research/articles/10.3389/fenrg.2021.742709/full>.

173 National Academies of Sciences, Engineering, and Medicine (2019) Gaseous carbon waste streams utilization: Status and research needs. The National 
Academies Press, Washington, DC. <https://nap.nationalacademies.org/read/25232/chapter/5#48>; Olfe-Kräutlein B, Strunge T, Chanin A (2021) Push or 
pull? Policy barriers and incentives to the development and deployment of CO₂ utilization, in particular CO₂ mineralization. Frontiers in Energy Research 9, 
742709. <https://www.frontiersin.org/journals/energy-research/articles/10.3389/fenrg.2021.742709/full>.



Chemicals, polymers and fuels 

Polymers (plastic, foams and resins)

Plastics are synthetic polymers comprised primarily of 
carbon, hydrogen, and oxygen, with smaller contributions 
from other elements depending on polymer type. 
Plastics are pervasive in modern society, used across 
packaging, construction, transport, electronics, textiles, 
and medical applications due to their durability, low 
cost, and versatility in form and function.174 The global 
plastics industry currently relies almost entirely on 
petroleum‑derived hydrocarbon monomers, which are 
produced through cracking of fossil feedstocks.175

Global production of plastics reached 413.8 Mt in 2023.176 
In Australia, an estimated 3.8 Mt of plastics were consumed 
in 2020–21.177 Global plastics production is expected to 
continue growing, and the IEA projects that the use of 
oil by the petrochemicals sector will increase by more 
than 50% by 2050 under current policies, with plastics 
accounting for much of this demand growth.178

Polymers can be grouped by distinct properties, end-use 
applications, and production processes, but all can be 
derived from a variety of platform chemicals. For example, 
olefins such as ethylene and propylene can be synthesised 
from CO2 and hydrogen via a methanol intermediate;179 
compounds such as benzene, toluene, and xylene are key 
precursors for high-performance plastics like polyesters 
and polyamides; and polyols and polycarbonates serve 
as building blocks for polyurethane foams, insulation 
materials, cushioning, and adhesives.180 These mechanisms 
are discussed further in the CO2 Utilisation Roadmap.181

CO2 utilisation presents an opportunity to produce 
polymers from captured CO2, reducing reliance on 
fossil feedstocks and enabling lower‑emissions plastics. 
However, the cost-competitiveness of CO2 derived polymer 
production relies on the reduction of green hydrogen 
levelised cost of production.182

Lithium chemicals

Captured CO2 can also play a novel role in lithium 
chemical production, offering lower-carbon pathways for 
battery‑grade materials. Conventional hard-rock refining 
extracts lithium (Li) as lithium sulphate which is then 
converted to lithium carbonate (Li2CO3) or hydroxide (LiOH) 
using sodium carbonate (Na2CO3) or sodium hydroxide 
(NaOH). However, Na2CO3 can also be replaced by CO2.183 
As an alternative, Novalith Technologies (Australia) is 
commercialising a process that uses captured CO₂ to 
produce lithium carbonate from spodumene and related 
materials, eliminating the need for strong acids and 
simplifying downstream conversion to battery-grade 
lithium carbonate.

Methanol-based chemicals and fuels

Beyond its role as a feedstock for olefins, methanol 
can be converted into a wide range of other products 
including formic acid and dimethyl ether (DME). DME is 
a clean burning fuel, which leaves little contamination 
and produces minimal smoke and harmful pollutants, 
similar to liquified petroleum gas (LPG). DME can act as 
propane supplement in cooking gas, aerosol spray-can 
propellant, solvent and chemical feedstock. There is interest 
in exploring DME as a transportation fuel, as well as 
potential in electric power generation, though large-scale 
deployment faces infrastructure and cost challenges.184 
Meanwhile, formic acid is used across agriculture, leather, 
textiles and food manufacturing industries.

174 Geyer R, Jambeck JR, Law KL (2017) Production, use, and fate of all plastics ever made. Science Advances 3(7), e1700782. <https://doi.org/10.1126/
sciadv.1700782>.

175 International Energy Agency (2018) The future of petrochemicals. <https://www.iea.org/reports/the-future-of-petrochemicals>.

176 Plastics Europe (2024) Plastics – the fast facts 2024. <https://plasticseurope.org/knowledge-hub/plastics-the-fast-facts-2024/>.

177 Department of Climate Change, Energy, the Environment and Water (2022) Australian plastics flows and fates study 2020–21 – National report. 
<https://www.dcceew.gov.au/sites/default/files/documents/apff-national-report-2020-21.pdf>.

178 International Energy Agency (2018) The future of petrochemicals. <https://www.iea.org/reports/the-future-of-petrochemicals>.

179 Han, Z., Tang, C., & Wang, J. (2021). Catalytic conversion of CO₂ to methanol and subsequently to olefins: Current status and future perspectives. Journal of 
CO₂ Utilization, 49, 101536

180 Kätelhön, A., Meys, R., Deutz, S., Suh, S., & Bardow, A. (2019). Climate change mitigation potential of carbon capture and utilization in the chemical industry. 
Proceedings of the National Academy of Sciences, 116(23), 11187–11194.

181 Srinivasan V, Temminghoff M, Charnock S, Moisi A, Palfreyman D, Patel J, Hornung C, Hortle A (2021) CO2 Utilisation Roadmap. CSIRO. 
<https://www.csiro.au/en/work-with-us/services/consultancy-strategic-advice-services/csiro-futures/energy/co2-utilisation-roadmap>

.

182 Srinivasan V, Temminghoff M, Charnock S, Moisi A, Palfreyman D, Patel J, Hornung C, Hortle A (2021) CO2 Utilisation Roadmap. CSIRO. 
<https://www.csiro.au/en/work-with-us/services/consultancy-strategic-advice-services/csiro-futures/energy/co2-utilisation-roadmap>

.

183 Kim S, Yoon H, Min T, Han B, Lim S, Park J (2024) Carbon dioxide utilization in lithium carbonate precipitation: a short review. Environmental Engineering 
Research 29(3), 230553.

184 Methanol Institute (2016) DME: an emerging global fuel. <https://www.methanol.org/wp-content/uploads/2016/06/DME-An-Emerging-Global-Guel-FS.pdf>.



Speciality and niche materials

Carbon nanomaterials

Carbon nanomaterials such as carbon nanotubes, 
graphene, and carbon nanofibers can be synthesised 
from CO₂ through electrochemical or catalytic processes. 
Some of these production processes combine the CO2 with 
industrial byproducts such as fly ash.185 These materials 
possess properties, such as high electrical and thermal 
conductivity and good mechanical strength, that position 
them well for uses in electronics, advanced composites, 
and energy storage.186 RMIT University is conducting 
research on carbon nanotubes and their use across a 
variety of applications including energy storage and 
conversion systems. At the same time, researchers have 
developed a technology that captures CO2 and converts it 
into solid carbon through the use of liquid metal catalysts. 
A provisional patent has been filed, and commercial 
partnership formed with ABR.187 These products, though in 
early commercialisation,188 offer a pathway to embed CO₂ 
into important high‑performance materials with higher unit 
value compared to other pathways.

Synthetic proteins and food ingredients

Synthetic proteins and food ingredients are an emerging 
application, where CO2 is used as a carbon source for 
microbial or algal fermentation. Combined with renewable 
hydrogen or electricity, CO2 can be converted into amino 
acids, protein, and nutrient-rich supplements. 

LanzaTech is in the process of completing trials and 
testing in animal feed and pet food, and is underway 
with completing the U.S. Food and Drug Administration’s 
Generally Recognized as Safe (‘GRAS’) certification process 
for LanzaTech Nutritional Protein (LNP) in human nutrition 
formulations.189 The Center for Aquaculture Technologies 
has successfully tested LNP for fish feed applications, 
and human food and beverage innovation firm Mattson 
completed thorough protein characterisation and food 
prototyping for dish concepts such as smoothies, dairy-free 
cheese, and bread. These technologies are early-stage, 
but offer the potential to decouple protein production 
from traditional agriculture, reducing land, water, and 
emissions footprints. 

185 Dlamini N, Mukaya HE, Nkazi D (2022) Carbon-based nanomaterials production from environmental pollutant byproducts: a review. Journal of CO₂ 
Utilization 60, 101953.

186 Dlamini N, Mukaya HE, Nkazi D (2022) Carbon-based nanomaterials production from environmental pollutant byproducts: a review. Journal of CO₂ 
Utilization 60, 101953; Hofstetter K, Licht G, Licht S (2025) New scalable electrosynthesis of distinct high purity graphene nanoallotropes from CO₂ 
enabled by transition metal nucleation. Crystals 15, 680. <https://doi.org/10.3390/cryst15080680>.

187 RMIT University (2022) Decarbonisation tech instantly converts CO₂ to solid carbon. <https://www.rmit.edu.au/news/media-releases-and-expert-
comments/2022/jan/decarbonisation-tech>.

188 See, for example, CarbonCorp (n.d.) Transforming CO₂ into valuable carbon nanomaterials. <https://carboncorp.org/>.

189 LanzaTech (2024) LanzaTech Nutritional Protein investor presentation. <https://lanzatech.com/wp-content/uploads/2024/11/LNZA-LNP-Investor-
Presentation-Nov-2024.pdf>.



4 Appendices

A.1 Contributing organisations

The authors would like to thank the following organisations that contributed to the development of this report through 
participation in consultations, calls for input, or reviews of draft content. Many CSIRO researchers also contributed 
their expertise. This report has not been endorsed by these organisations or their representatives. 

ABEL Energy

Australian Government 
Department of Climate Change, 
Energy, the Environment 
and Water

CarbonNet

Climate Change Authority

Cement Concrete & Aggregates 
Australia

CO2 Value Australia

CO2 Value Europe

CSR

Dyno Nobel

HAMR Energy

HIF Global

MCi Carbon

New South Wales Department 
of Climate Change, Energy, 
the Environment and Water

Northern Territory Department 
of Mining and Energy

Orica

RECARB Hub

Western Australia Department 
of Energy and Economic 
Diversification

Xodus Group



A.2 Modelling methodology 
and general assumptions

This appendix outlines the modelling methodology 
and assumptions used to assess the market viability of 
CO₂‑derived products across multiple sectors. While the 
specific cost components vary by product (reflecting 
differences in production pathways, feedstocks and 
end uses), all CO2-derived products are assessed using 
a consistent framework that estimates levelised cost of 
production (LCOP), incorporating capital costs, input 
costs, and other operating costs. Carbon intensity values 
are used to estimate CO₂ emission costs under low and 
high ambition scenarios, which are added to production 
costs to compare their cost competitiveness. Market share 
is allocated using a market clearing approach, in order 
of increasing production cost. This approach makes the 
simplifying assumptions that price is the sole factor 
influencing consumer choice among competing options, 
that total demand is inelastic (e.g. does not change in 
response to price), and that feedstock and/or production 
capacity constraints apply. Where a CO₂-derived product 
is forecast to be cost competitive and capture market 
share, CO2 utilisation, domestic revenue, and employment 
potential have also been estimated. 

Model Overview

1

Estimate production 
and CO2 emission 
costs in 2050

• Calculate levelised cost 
of production for each 
CO2‑derived product.
• Estimate production costs 
for bio-products and 
conventional products 
from market research 
and literature. 
• Estimate CO2 emission 
costs under low and 
high decarbonisation 
ambition scenarios. 


2

Model domestic 
demand and 
market share 
in 2050

• Estimate total domestic 
market using market 
research data. 
• Allocate market share 
using a market clearing 
assessment and relevant 
supply constraints. 


3

Estimate potential 
economic benefits, 
CO2 utilisation 
and abatement

• Estimate domestic revenue 
and job potential using 
industry benchmarks 
for CO2‑derived and 
bio-products with 
market share.
• Calculate CO2 utilisation 
volume (feedstock 
requirement) for 
CO2‑derived products 
with market share.
• Calculate CO2 abatement 
potential for CO2-derived 
and bio-products with 
market share.




1. Estimate production and 
CO2 emission cost in 2050

Each CO2-derived product is assessed using a LCOP 
model that reflects its specific production pathway, 
feedstock requirements, and operational characteristics. 
While the structure varies by product, all models include 
capital investment and key input costs and produce 
estimates of the total production cost per tonne of output 
in 2050. All electricity inputs and prices are assumed to 
be renewable. Assumptions are derived from existing CSIRO 
analysis, literature, and industry insights. For bio‑products 
and conventional products, production cost estimates 
are derived from literature or market price data. 
Where necessary, profit margins are removed from market 
prices to estimate production costs. 

To explore different decarbonisation ambition scenarios, 
two distinct CO2 emission cost assumptions are modelled 
for 2050. Well-to-wheel190 carbon intensities are estimated 
for each product and are multiplied by the CO2 emission 
cost applied to each tonne of CO2 emitted during the 
production and use of each product to determine the 
emissions cost component of production. This cost is 
added to the LCOP, improving the relative competitiveness 
of products that emit less CO2, and reducing the 
competitiveness of products that emit more CO2. 

• Low ambition scenario: CO2 emission costs rise 
gradually (from $75/t in 2025 to $125/t in 2050191), 
reflecting limited uptake of abatement technologies 
and fragmented climate action.
• High ambition scenario: CO2 emission costs rise 
more sharply (to $425/t in 2050192), reflecting 
emissions reductions and accelerating demand for 
low‑emissions products. This scenario is broadly 
consistent with the level of ambition required to 
achieve net zero by 2050.


The CO2 emission costs applied in this scenario-based 
approach are shadow carbon prices, which reflect the 
combined effect of all policies, regulations, and incentives 
that affect relative product costs of CO2 emitting products. 
This is a standard method for assessing low-emissions 
technologies and does not imply the adoption of a carbon 
pricing policy. Rather, it provides a structured framework to 
explore how different policy and market signals may shape 
future demand for CO₂-derived products.

2. Model domestic demand 
and market share in 2050

Demand and market share is determined using a market 
clearing methodology:

1. Estimating the total market size for each product, 
regardless of production pathway
2. Ranking production pathways by cost (including CO₂ 
emission cost adjustments)
3. Applying feedstock or production capacity limits 
where relevant
4. Allocating demand to the cheapest available product 
until feedstock/production capacity limits or the overall 
market size are reached (a market clearing approach)


The analysis analyses demand projections for the Australian 
market, without attributing supply sources between local 
production and imports. It assumes a commodity market 
context, where incumbent prices reflect global commodity 
prices paid by domestic consumers. In doing so, it accounts 
for the competitiveness of cheaper incumbent imports. 
However, the CO2-derived production costs are based on 
Australia-specific assumptions as provided in Table 14. 
As such, this analysis does not assess potential competition 
from imported low-carbon products. 

3. Estimate potential economic 
benefits, CO2 utilisation requirements, 
and abatement 

For CO₂-derived products and bio-products that are forecast 
to capture some market share, the following are estimated: 

• Domestic revenue potential.
• Employment potential.
• Carbon utilisation potential.
• Carbon abatement potential.


190 Well-to-wheel (or well-to-wake) refers to the emissions produced through the entire lifecycle of a product, including its production, transport and use.

191 Derived by applying CAGR of 2% to the Safeguard Guard Mechanism price of $75/t out to 2050. Clean Energy Regulator (2025) Cost containment measure. 
<https://cer.gov.au/schemes/safeguard-mechanism/managing-excess-emissions/cost-containment-measure>.

192 Derived by adapting estimates from the International Energy Agency (IEA) to align with CSIRO modelling specifications. This estimate reflects the value 
of the shadow carbon price required to achieve net zero for advanced economies. Shadow carbon prices are proxies for the combined economic effect 
of direct carbon pricing and complementary policies. See International Energy Agency (2024) World energy outlook 2024. <https://www.iea.org/reports/
world-energy-outlook-2024>. 



General assumptions

Table 14: Common inputs and assumptions across modelled products

INPUT

2050

SOURCE

UNIT

LOW 
AMBITION

HIGH 
AMBITION 

CO2 emission cost

$/tCO2

125

425

The low CO2 emission cost assumption was estimated 
by applying Compound Annual Growth Rate (CAGR) of 
2% to the Safeguard Guard Mechanism price of $75/t.193

The high CO2 emission cost assumption was adapted 
from the International Energy Agency’s forecasts.194

Hydrogen production cost 

$/kg H2

3.4

CSIRO Levelised Cost of Production modelling 
(unpublished) for 2050. Optimised production costs 
calculated using partially firmed renewable electricity.

Assumed electricity cost 
for hydrogen production

c/kWh

7.0 

(60% firmed, renewable)

CSIRO Levelised Cost of Production modelling 
(unpublished) for 2050.

Industrial captured CO₂ 

$/tCO2

62

The assumed cost of industrial CO₂ capture was 
derived from the best case (2050) levelised cost of 
capture modelling under medium partial pressure 
of 12–14 kPa.195

DAC CO₂ 

$/tCO2

408

CSIRO Levelised Cost of Capture Modelling of 
Nth‑of‑a‑Kind (2050) DAC facilities.196

Assumed electricity cost 
for DAC

c/kWh

9.7

(firmed, renewable)

CSIRO Levelised Cost of Production Modelling for 2050. 
Optimised production costs calculated using firmed 
renewable electricity.197

USD:AUD Exchange rate

AUD 

1.5266

Three-year average. Reserve Bank of Australia. 

Jet fuel specific volume

L/t

1263

CSIRO Sustainable Aviation Fuel Roadmap





193 Clean Energy Regulator (2025) Cost containment measure. <https://cer.gov.au/schemes/safeguard-mechanism/managing-excess-emissions/cost-
containment-measure>.

194 This estimate reflects the value of the CO2 emission cost required to achieve net zero for advanced economies. They are assumed to rise on average to USD 
130 per tonne (tCO2) by 2030 and to USD 250/tCO2 by 2050. International Energy Agency (2021) Net zero by 2050: a roadmap for the global energy sector. 
International Energy Agency, Paris. <https://www.iea.org/reports/world-energy-outlook-2024>.

195 Srinivasan V, Temminghoff M, Charnock S, Moisi A, Palfreyman D, Patel J, Hornung C, Hortle A (2021) CO2 Utilisation Roadmap. CSIRO. 
<https://www.csiro.au/en/work-with-us/services/consultancy-strategic-advice-services/csiro-futures/energy/co2-utilisation-roadmap>.

196 CSIRO (2025) Australian Carbon Dioxide Removal Roadmap. CSIRO.

197 CSIRO (2025) Australian Carbon Dioxide Removal Roadmap. CSIRO.



A.3 Methanol assumptions and results

To assess the potential demand for e-methanol in Australia, we model the demand for e-methanol produced using point 
source (PSC) and direct air capture (DAC) CO2 feedstocks in a simplified domestic market with conventional methanol and 
bio-methanol198 alternatives. 

Production and CO2 emission costs 

Levelised production cost components for e-methanol are estimated by applying updated cost assumptions 
(see Appendix A.2) to the LCOP model developed by CSIRO for the 2021 CO₂ Utilisation Roadmap. These costs are 
summed together to estimate the total LCOP in Table 15.

Table 15: Cost components that contribute to the 2050 LCOP of e-methanol using PSC or DAC CO2 

COST COMPONENT

UNIT

2050 LEVELISED COST

Capital cost

$/t methanol

94

Hydrogen

$/t methanol

586

CO2 capture cost (PSC) 

$/t methanol

79.4

CO2 capture cost (DAC) 

$/t methanol

522

Other variables

$/t methanol

130





Comparative costs for each reference product derived from literature are described in Table 16. For conventional methanol, 
the 2050 cost is estimated by extrapolating current market values forward using long-run natural gas and coal price trends 
and removing average industry profit margins. 

Table 16: Production cost assumptions for reference methanol products 

PRODUCT

UNIT

2025

2050

SOURCE

Conventional 
methanol

$/t

546199

766

The production cost of conventional methanol in 2050 is calculated assuming a 
weighted average compound annual growth rate of 1.4% assuming 65% is produced 
from natural gas (0.7% CAGR) and 35% is produced from coal (2.5% CAGR). 200,201

Bio-methanol

$/t

1143

726

Average bio-methanol production costs (USD/t) for 2025 and 2050 are estimated 
from biomass and municipal solid waste feedstocks, incorporating low/high CAPEX, 
feedstock, and OPEX scenarios. The 2025 cost is inflated to reflect current price levels.202





CO2 emission intensity values are estimated for all products (Table 17). 

Table 17: Well-to-wheel life-cycle carbon intensity values of different methanol products203

PRODUCT

UNIT

TOTAL WELL-TO-WHEEL

e-methanol (PSC)

tCO2/t

0.870

e-methanol (DAC)

tCO2/t

0.0574

Conventional methanol

tCO2/t

2.34

Bio-methanol

tCO2/t

0.210





Note: The carbon intensities are calculated assuming end-of-cycle release of captured carbon to the atmosphere. 

198 Bio-e-methanol (produced from both biomass and renewable hydrogen feedstocks) is being pursued by some project developers in Australia, however this 
product is not included in our market modelling due to limited data availability.

199 Fossil fuel-based methanol production costs range from USD 100–250 per tonne and have been adjusted to reflect current-year estimates. IRENA And 
Methanol Institute (2021) Innovation Outlook: Renewable Methanol, International Renewable Energy Agency, Abu Dhabi.

200 The growth rate is calculated using weighted average rate of coal. <U.S. Energy Information Administration (2025) Annual Energy Outlook 2025. Table: Table 1. 
Total Energy Supply, Disposition, and Price Summary. <https://www.eia.gov/outlooks/aeo/data/browser/#/?id=1-AEO2025&region=0-0&cases=ref2025&start=20
23&end=2050&f=Q&linechart=ref2025-d032025a.3-1-AEO2025>.> The growth rate of natural gas is adapted from internal CSIRO modelling (unpublished).

201 Conventional methanol is obtained from fossil fuels. 55–65% of global methanol production uses natural gas feedstock, about 30–35% uses coal. National 
Energy Techology Laboaraty (n.d.) 10.3. Syngas Conversion to Methanol. <https://www.netl.doe.gov/research/carbon-management/energy-systems/
gasification/gasifipedia/methanol>.

202 Production cost estimated adapted from Figure 35 in: IRENA And Methanol Institute (2021) Innovation outlook: Renewable Methanol, International 
Renewable Energy Agency, Abu Dhabi.

203 Hawkins TR, Masum F, Beck A, Young B (2022) GREET marine module introduction and instructions. Argonne National Laboratory, Lemont, Illinois. 
<https://greet.anl.gov/files/greet_marine_manual_2022>.



These carbon intensity estimates are then multiplied by the low and high CO2 emission cost assumptions and added to the 
estimated LCOP to calculate total costs for each product under the low and high ambition scenarios in 2050 (Table 18).

Table 18: Estimated LCOP and total cost of methanol products with CO₂ emission cost in 2050 

PRODUCT

UNIT

LCOP

LOW AMBITION

HIGH AMBITION

e-methanol (PSC)

$/t

889

996

1259

e-methanol (DAC)

$/t

1331

1338

1356

Conventional methanol

$/t

766

1054

1761

Bio-methanol

$/t

726

752

815





Forecast domestic demand

To estimate the modelled demand for each methanol product, the total domestic demand for methanol in 2050 (Table 19) is 
estimated to reach 8.7 Mt. This demand is assumed to be inelastic. 

Table 19: Total domestic market size for methanol in 2025 and 2050

UNIT

2025

2050

SOURCE

Total domestic 
methanol demand

Mt

3.3

8.7

Methanol demand of 3.1 MT estimated in 2023 
with CAGR 3.89%.204





This modelled demand is allocated to the cheapest products available, in consideration of relevant supply limits described 
in Table 20. Supply limits are aligned with the feedstock allocation estimated in the Sustainable Aviation Fuel Roadmap 
(2023) under the Low Allocation scenario, which considers SAF and other alterative competing uses for feedstocks.205 
An estimated 19.5 Mt of suitable feedstocks – comprising municipal solid waste and biomass sources such as agricultural 
and sawmill residues, and sorghum206 – is assumed to be available for bio-methanol production. Based on conversion yields 
of 20%207 from municipal solid waste, 55%208 from agricultural and sawmill residues, and 42%209 from sorghum; the effective 
production capacity is estimated at 9.1 Mt of bio-methanol. Supply limits for products that do not capture any demand were 
not estimated. 

Table 20: Supply limit assumptions for methanol products

PRODUCT

UNIT

2050

SOURCE

Bio-methanol

Mt

9.1

SAF Roadmap





204 Australia methanol demand was estimated to be 3.1 Mt in 2023 and was forecast to grow at CAGR of 3.89% until 2035. ChemAnalyst (2024) Australia 
methanol market analysis: industry market size, plant capacity, production, operating efficiency, demand & supply, end-user industries, sales channel, 
foreign trade, regional demand, company share, manufacturing process, 2015–2034. <https://www.chemanalyst.com/industry-report/australia-methanol-
market-201>.

205 Only municipal solid waste, residues, and sorghum are considered as bio-feedstocks in this modelling. While other biomass sources are also suitable for 
bio-methanol production, a detailed assessment is beyond the scope of this report.

206 Feedstock limit is adapted from Temminghoff M, Kuen M, Cohen J, Duong P, Deverell J, Palfreyman D, Livitsanis A, Clark J, Patel J, Moore A (2023) Sustainable 
aviation fuel roadmap. CSIRO, Canberra. Biomass feedstock (including municipal solid waste, sorghum, agricultural and sawmill residues) available for 
biomethanol production adapted under high yield, high growth, and high allocation scenario. 

207 The energy conversion of municipal solid waste is around 50%. At 8MJ/kg energy content for municipal solid waste, after conversion, this leaves 4MJ 
of MeOH, which is 0.20kg, so a mass conversion efficiency of 20%. IRENA and Methanol Institute (2021) Innovation outlook: renewable methanol. 
International Renewable Energy Agency, Abu Dhabi.

208 Kasmuri NH, Kamarudin SK, Abdullah SRS, Hasan HA, Som AM (2016) Potential of biomass for biomethanol production. International Journal of Applied 
Engineering Research 11(19), 10016–10019. Comparison of biomethanol yield in table 2.

209 Nakagawa H, Harada T, Ichinose T, Takeno K, Matsumoto S, Kobayashi M, Sakai M (2007) Biomethanol production and CO₂ emission reduction from forage 
grasses, trees, and crop residues. Japan Agricultural Research Quarterly (JARQ) 41(2), 173–180. 



Table 21 shows the forecast demand for methanol products under the different scenarios with the feedstock limits applied. 
In both scenarios the modelled demand for bio-methanol products is lower than the feedstock limit in Table 20. As such, 
the total modelled demand can be met by bio-methanol. 

Table 21: Forecast demand for methanol products in 2050 under low and high ambition scenarios with the feedstock limits applied

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

e-methanol (PSC)

Mt

0

0

e-methanol (DAC)

Mt

0

0

Conventional methanol

Mt

0

0

Bio-methanol

Mt

8.7

8.7





CO2 abatement potential

For products modelled to capture market share, CO₂ abatement is quantified relative to the carbon intensity of the 
incumbent product and applied to its estimated market demand. Table 22 shows the forecast CO2 abatement potential 
for methanol products under the different scenarios.

Table 22: Carbon abatement potential for bio-methanol in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Bio-methanol

MtCO2

18.5

18.5





Domestic revenue and employment potential

The profit margin from the basic organic chemical manufacturing industry is applied to estimate the revenue associated 
with methanol demand in 2050. Revenue data from this industry is also used to estimate potential employment figures 
associated with this revenue (Table 23).

Table 23: Profit margin and revenue per employee industry benchmark210

VARIABLES

VALUE

BENCHMARK INDUSTRY

Profit margin applied to estimate revenue

9.2%

Basic organic chemical manufacturing industry.

Revenue/employee

$1.4m





Table 24 shows the forecast domestic revenue and Table 25 shows the employment potential for bio-methanol products 
under the different scenarios. 

Table 24: Domestic revenue potential for bio-methanol products in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Bio-methanol

$b

7

7





Table 25: Employment potential for bio-methanol products in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Bio-methanol

FTE

5000

5000





210 IBISWorld (2025) Basic Organic Chemical Manufacturing in Australia. <https://my.ibisworld.com/au/en/industry/c1812/at-a-glance>.



A.4 Aviation fuel assumptions and results

To assess the potential demand for e-SAF in Australia, we model the demand for e-SAF products derived from point source 
(PSC) and direct air capture (DAC) CO2 feedstocks in a simplified domestic market with conventional jet fuel (CJF) and two 
bio-SAF alternatives: bio-SAF (HEFA) derived from lipid-based feedstocks and bio-SAF (FT) derived from carbohydrates, 
municipal solid waste, and residues.

Production and CO2 emission costs 

Levelised production cost components for e-SAF are estimated by applying updated cost assumptions (see Appendix A.2) 
to the LCOP model developed by CSIRO for the 2021 CO₂ Utilisation Roadmap. The relevant cost components are summed 
together to estimate the total LCOP for each e-SAF product in Table 26.

Table 26: Cost components that contribute to the 2050 LCOP for e-SAF produced using PSC or DAC CO2 via an ATJ pathway with 
methanol as an intermediate

COST COMPONENT

UNIT

2050 LEVELISED COST

Capital cost

$/t SAF

23.6

Methanol production (excluding H2 and CO2) 

$/t SAF

553

Hydrogen

$/t SAF

1780

CO2 capture cost (PSC) 

$/t SAF

243

CO2 capture cost (DAC) 

$/t SAF

1600

Other variables

$/t SAF

9.45

Fixed O&M

$/t SAF

9.45





Comparative costs for each reference product derived from literature are described in Table 27. For CJF, the 2050 cost is 
estimated by extrapolating current market values forward using long-term oil price trends and removing average industry 
profit margins. For bio-SAF products, levelised production costs are based on previous technoeconomic assessment in the 
CSIRO Sustainable Aviation Fuel Roadmap (2021).

Table 27: Production cost assumptions for reference aviation fuel products 

PRODUCT

UNIT

2025

2050

SOURCE

CJF

$/t

921

1170211

IATA (2025) Jet Fuel Price Monitor. Weekly average jet fuel price of USD 678.03/t. 
12.5% profit margin was removed to estimate production cost of CJF. 

Bio-SAF (HEFA)

$/t

1910

1690

Sustainable Aviation Fuel Roadmap.212

Bio-SAF (FT)

$/t

2360

1450

Sustainable Aviation Fuel Roadmap.213





211 U.S. Energy Information Administration (2025) Annual energy outlook 2025. U.S. Department of Energy, Washington, DC. <https://www.eia.gov/outlooks/aeo/>. 
According to the EIA, the spot price of conventional jet fuel is projected to grow at 0.96% CAGR between 2025 and 2050.

212 SAF produced by the Hydroprocessed Esters and Fatty Acids (HEFA) pathway using oilseeds and tallow waste as feedstocks. Converted from average 
levelised cost of production (LCOP) of SAF (HEFA) is estimated as 1.51 $/L and 1.34 $/L for 2025 and 2050 respectively. Profit margin not included in LCOP. 
Temminghoff M, Kuen M, Cohen J, Duong P, Deverell J, Palfreyman D, Livitsanis A, Clark J, Patel J, Moore A (2023) Sustainable aviation fuel roadmap. 
CSIRO, Canberra.

213 SAF produced by the Fischer-Tropsch (FT) pathways using bagasse, municipal solid waste, or residues as feedstocks. Converted from average levelised cost 
of production (LCOP) of SAF (FT) is estimated as 1.87 $/L and 1.15 $/L for 2025 and 2050 respectively. Profit margin not included in LCOP. Temminghoff M, 
Kuen M, Cohen J, Duong P, Deverell J, Palfreyman D, Livitsanis A, Clark J, Patel J, Moore A (2023) Sustainable aviation fuel roadmap. CSIRO, Canberra.



CO2 emission intensity values are estimated for all products (Table 28). 

Table 28: Well-to-wheel life-cycle carbon intensity values of different jet fuel products214

PRODUCT

UNIT

TOTAL WELL-TO-WHEEL

e-SAF (PSC)

tCO2/t

2.10

e-SAF (DAC)

tCO2/t

0.120

CJF

tCO2/t

3.54

Bio-SAF (HEFA)

tCO2/t

1.20

Bio-SAF (FT)

tCO2/t

0.157





These carbon intensity estimates are then multiplied by the low and high CO2 emission cost assumptions and added to the 
estimated LCOP to calculate total costs for each product under the low and high ambition scenarios in 2050 (Table 29).

Table 29: Estimated LCOP and total cost of aviation fuel products with CO₂ emission cost in 2050 

PRODUCT

UNIT

LCOP

LOW AMBITION

HIGH AMBITION

e-SAF (PSC)

$/t

2623

2881

3516

e-SAF (DAC)

$/t

3977

3992

4028

CJF

$/t

1168

1603

2672

Bio-SAF (HEFA)

$/t

1692

1840

2204

Bio-SAF (FT)

$/t

1452

1472

1519





Forecast domestic demand 

To estimate the demand for each aviation fuel product, the total domestic demand for aviation fuel in 2050 (Table 30) is estimated 
by extrapolating data from the CSIRO Sustainable Aviation Fuel Roadmap (2023). This demand is assumed to be inelastic.

Table 30: Total domestic market size for jet fuel in 2025 and 2050

UNIT

2025

2050

SOURCE

Domestic jet fuel demand

Mt

7.33

12.3

CSIRO SAF Roadmap





This demand is allocated to the cheapest products available, in consideration of relevant production capacity limits 
described in Table 31. Supply limits are aligned with the feedstock allocation estimated in the Sustainable Aviation Fuel 
Roadmap (2023) under the Low Allocation scenario, which considers bio-methanol and other alterative competing uses for 
bio-feedstocks. Supply limits for products that do not capture any demand were not estimated. 

Table 31: Supply limit assumptions for sustainable aviation fuel products in 2050

PRODUCT

UNIT

ESTIMATED ANNUAL SUPPLY LIMIT

SOURCE

Bio-SAF (HEFA) 215

Mt

0.2

CSIRO SAF Roadmap

Bio-SAF (FT) 216

Mt

3.2

CSIRO SAF Roadmap





214 Argonne National Laboratory (n.d.) GREET model: greenhouse gases, regulated emissions, and energy use in transportation. <https://greet.anl.gov/greet_
marine> and Argonne National Laboratory (2025) R&D GREET marine module introduction and instructions. <https://greet.anl.gov/files/ttt_2025-marine_
fuel_vessels-intro>.

215 Equivalent to high growth, high yield, high allocation scenario of suitable domestic biomass feedstock (including tallow, cottonseed, and canola) in 2050. 
Temminghoff M, Kuen M, Cohen J, Duong P, Deverell J, Palfreyman D, Livitsanis A, Clark J, Patel J, Moore A (2023) Sustainable aviation fuel roadmap. 
CSIRO, Canberra.

216 Equivalent to high growth, high yield, high allocation scenario of suitable domestic biomass feedstock (including municipal solid waste, agricultural and 
sawmill residues, and bagasse) in 2050. Temminghoff M, Kuen M, Cohen J, Duong P, Deverell J, Palfreyman D, Livitsanis A, Clark J, Patel J, Moore A (2023) 
Sustainable aviation fuel roadmap. CSIRO, Canberra.



Table 32 shows the forecast demand for jet fuel products under the different scenarios with the production limits applied. 
In both scenarios the demand for one or more bio-SAF products exceeds the production limits in Table 31. As such, the 
remaining demand is distributed to the next cheapest product. 

Table 32: Forecast demand for jet fuel products in 2050 under low and high ambition scenarios with the capacity limits applied

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

e-SAF (PSC)

Mt

0

0

e-SAF (DAC)

Mt

0

0

CJF

Mt

9.1

8.9

Bio-SAF (HEFA)

Mt

0

0.2

Bio-SAF (FT)

Mt

3.2

3.2





CO2 abatement potential

For products modelled to capture market share, CO₂ abatement is quantified relative to the carbon intensity of the 
incumbent product and applied to its estimated market demand. Table 33 shows the forecast CO2 abatement potential 
for bio-SAF products under the different scenarios.

Table 33: Carbon abatement potential for bio-SAF products in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Bio-SAF (HEFA)

MtCO2

0

0.5

Bio-SAF (FT)

MtCO2

10.8

10.8





Domestic revenue and employment potential

The profit margin from the basic organic chemical manufacturing industry is applied to estimate the revenue associated 
with aviation fuel demand in 2050. Revenue data from this industry is also used to estimate potential employment figures 
associated with this revenue (Table 34).

Table 34: Profit margin and revenue per employee industry benchmark217

VARIABLES

VALUE

BENCHMARK INDUSTRY

Profit margin applied to estimate revenue

9.2%

Basic organic chemical manufacturing industry.

Revenue/employee

$1.4m





Table 35 shows the forecast domestic revenue and Table 36 shows the employment potential for bio-SAF products under 
the different scenarios. 

Table 35: Domestic revenue potential for bio-SAF products in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Bio-SAF (HEFA)

$b

0

0.4

Bio-SAF (FT)

$b

5

5





Table 36: Employment potential for bio-SAF products in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Bio-SAF (HEFA)

FTE

0

300

Bio-SAF (FT)

FTE

3800

3800





217 IBISWorld (2025) Basic Organic Chemical Manufacturing in Australia. <https://my.ibisworld.com/au/en/industry/c1812/at-a-glance>.



A.5 Urea assumptions and results

To assess the potential demand for low-carbon urea in Australia, we model the demand for urea produced using renewable 
hydrogen and atmospheric nitrogen (with ammonia as intermediate) with point source (PSC) or direct air capture (DAC) CO2 
feedstocks in a simplified domestic market with conventional urea.

Production and CO2 emission costs 

Levelised production cost components for urea produced from PSC and DAC CO2 feedstocks are estimated by applying 
updated cost assumptions (see Appendix A.2) to the LCOP model developed by CSIRO for the 2023 CO2 Utilisation in the 
Northern Territory report. The relevant cost components are summed together to estimate the total LCOP for each urea 
product in Table 37.

Table 37: Cost components that contribute to the 2050 LCOP of urea produced using PSC or DAC CO2 and renewable hydrogen with 
green ammonia as an intermediate

COST COMPONENT

UNIT

2050 LEVELISED COST

Capital cost

$/t urea

1.87

Ammonia production cost (excluding H2)

$/t urea

95.9

Hydrogen

$/t urea

347

CO2 capture cost (PSC)

$/t urea

45.3

CO2 capture cost (DAC)

$/t urea

297

Other variables

$/t urea

30.1

Fixed O&M

$/t urea

2





Comparative costs derived from literature for the conventional urea reference product are described in Table 38. 
For conventional urea, the 2050 cost is estimated by extrapolating current market values forward using long-run 
natural gas price trends and removing average industry profit margins. 

Table 38: Production cost assumptions for reference urea product

PRODUCT

UNIT

2025

2050

SOURCE

Conventional urea

$/t

437218

525

10 year average urea price is estimated at 477.8 $/t; calculated over 
2015–2025. The 2025 production cost is reported exclusive of profit margin. 
Domestic natural gas price projections used as proxy for urea price growth 
(0.74% CAGR219).





CO2 emission intensity values are estimated for all products (Table 39). 

Table 39: Well-to-wheel life-cycle carbon intensity values of different urea products220

PRODUCT

UNIT

TOTAL WELL-TO-WHEEL

Urea (PSC)

tCO2/t

0.369

Urea (DAC)

tCO2/t

0.0247

Conventional urea

tCO2/t

1.14





218 IndexMundi (n.d.) Urea – monthly price (Australian Dollar per metric ton). <https://www.indexmundi.com/commodities/?commodity=urea&currency=aud>.

219 CSIRO Levelised Cost of Production Modelling (unpublished) for 2025 and 2050. 

220 CSIRO internal modelling.



These carbon intensity estimates are then multiplied by the low and high CO2 emission cost assumptions and added to the 
estimated LCOP to calculate total costs for each product under the low and high ambition scenarios in 2050 (Table 40).

Table 40: Estimated LCOP and total cost of urea products with CO₂ emission cost in 2050 

PRODUCT

UNIT

LCOP

LOW AMBITION

HIGH AMBITION

Urea (PSC)

$/t

523

568

679

Urea (DAC)

$/t

775

778

785

Conventional urea

$/t

525

665

1009





Forecast domestic demand 

To estimate the demand for each urea product, the total domestic demand for urea in 2050 (Table 41) is estimated by 
extrapolating current domestic demand (assumed to be the average of Australia’s urea imports between 2014–2024) based 
on a global growth rate calculated from the IEA modelling.221 This demand is assumed to be inelastic. 

Table 41: Total domestic market size for urea in 2025 and 2050

UNIT

2025

2050

Total domestic urea demand

Mt

2.32222

2.74





This demand is allocated to the cheapest product available. No supply limits were applied to low-carbon urea production, 
but the availability of renewable H2 and suitable CO2 sources could limit its availability. Table 42 shows the forecast demand 
for urea products under the different scenarios. Under both scenarios, urea (PSC) captures all demand. 

Table 42: Forecast demand for urea products in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Urea (PSC)

Mt

2.74

2.74

Urea (DAC)

Mt

0

0

Conventional urea

Mt

0

0





221 The Stated Policies scenario predicts that global demand for urea-based fertilisers will increase from 84 Mt in 2030 to 96 Mt in 2050, equivalent to CAGR 
for urea demand of 0.67% between 2030-2050. International Energy Agency (2021) Nitrogen demand by end use and scenario, 2020–2050. IEA, Paris. 
<https://www.iea.org/data-and-statistics/charts/nitrogen-demand-by-end-use-and-scenario-2020-2050>.

222 10-year average of urea imports to Australia. World Bank (2014) Australia urea imports. World Integrated Trade Solution (WITS). <https://wits.worldbank.
org/CountryProfile/en/AUS>.



CO2 utilisation and abatement potential

CO₂ utilisation for modelled products capturing market share is determined from the stoichiometric CO₂ requirement per 
tonne of product, multiplied by the estimated market demand. Table 43 shows the forecast CO2 utilisation for urea (PSC) 
products under the different scenarios. 

Table 43: Carbon utilisation potential for urea (PSC) products in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Urea (PSC)

MtCO2

2.01

2.01





For products modelled to capture market share, CO₂ abatement is quantified relative to the carbon intensity of the 
incumbent product and applied to its estimated market demand. Table 44 shows the forecast CO2 abatement potential 
for green urea products under the different scenarios.

Table 44: Carbon abatement potential for urea (PSC) products in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Urea (PSC)

MtCO2

2.1

2.1





Domestic revenue and employment potential

The profit margin from the fertiliser manufacturing industry is applied to estimate the revenue associated with urea 
demand in 2050. Revenue data from this industry is also used to estimate potential employment figures associated with 
this revenue (Table 45).

Table 45: Profit margin and revenue per employee industry benchmark223

VARIABLES

VALUE

BENCHMARK INDUSTRY

Profit margin applied to estimate revenue

9.4%

Fertiliser manufacturing industry.

Revenue/employee

$1.6m





Table 46 shows the forecast domestic revenue and Table 47 shows the employment potential for urea (PSC) products under 
the different scenarios. 

Table 46: Domestic revenue potential for urea (PSC) products in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Urea (PSC)

$b

1.6

1.6





Table 47: Employment potential for urea (PSC) products in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Urea (PSC)

FTE

1000

1000





223 IBISWorld (2025) Fertiliser manufacturing industry. <https://my.ibisworld.com/au/en/industry/c1831/at-a-glance>.



A.6 Mineral aggregate assumptions and results

To assess the potential demand for carbonated mineral aggregates in Australia, we estimate the demand for a carbonated fine 
aggregate product (produced from concrete and steel waste, and industrial flue gas containing CO2) by modelling a simplified 
pre-mixed concrete market that considers two concrete blends: one conventional and one carbonated fine aggregate as 
substitute for sand. The techno-economic model and input data was partially informed by data provided by MCi Carbon. 

Production and CO2 emission costs 

The LCOP for carbonated fine mineral aggregates (Table 49) was estimated by applying updated cost assumptions 
(see Appendix A.2, and Table 48) and updated data provided by MCi Carbon to a levelised cost of production model 
developed by CSIRO for the 2021 CO₂ Utilisation Roadmap. As some of the data provided by MCi Carbon is confidential, 
a full break down of the levelised cost components is not available for this model. 

Table 48: Carbonated fine mineral aggregate input cost assumptions 

INPUT COST ASSUMPTION

UNIT

2050

SOURCE

Steel slag waste 

$/t

0

Steel slag waste is assumed to be procured at zero cost. 

Concrete waste 

$/t

0

Concrete waste is assumed to be procured at zero cost. 

Concrete waste pretreatment

$/t

0

It is assumed that concrete waste incurs no pretreatment cost.

Logistics and transport

$/t

0

It is assumed that there are no logistics and transport costs associated 
with the transportation of feedstocks to the production facility.

Flue Gas (containing CO₂)

$/t

0

Assumed zero cost waste feedstock.





Table 49: LCOP cost for carbonated mineral aggregates

PRODUCT

UNIT

2050

Carbonated fine aggregate

$/t

15.4





Cost estimates for concrete blend inputs derived from literature are described in Table 50. The costs of Ordinary Portland 
Cement (OPC), sand, and coarse aggregates are estimated by removing average industry profit margins from recent 
market prices. It is assumed that these costs do not increase in real terms between 2025 and 2050. 

Table 50: Input cost assumptions for concrete blends

COST

SOURCE

PRODUCT

UNIT

2025

2050

Ordinary Portland Cement (OPC) 

$/t

99

99

The 2025 cost of producing OPC is estimated by removing an assumed 
15.7% profit224 from an average OPC price of $115 per tonne.225

Sand 

$/t

45

45

The 2025 cost of producing sand is estimated by removing a 
12.4%226 profit from average sand price of $50 per tonne.227

Coarse aggregate 

$/t

55

55

The 2025 cost of producing coarse aggregate is estimated by 
removing an assumed 12.4% profit228 from average aggregate 
price of $61.50 per tonne.229





224 IBISWorld (2025) Cement and lime Manufacturing in Australia. <https://my.ibisworld.com/au/en/industry/c2031/at-a-glance>.

225 IMARC Group. (2025). Cement Prices, Trend, Chart, Demand, Market Analysis, News, Historical and Forecast Data Report 2025 Edition. IMARC Group. 
<https://www.imarcgroup.com/cement-pricing-report

>.

226 IBISWorld (2025) Rock, limestone, and clay mining in Australia. <https://my.ibisworld.com/au/en/industry/b0919/at-a-glance>

.

227 IMARC Group. (2025). Silica Sand Prices, Trend, Chart, Demand, Market Analysis, News, Historical and Forecast Data Report 2025 Edition. IMARC Group. 
<https://www.imarcgroup.com/silica-sand-price-trend

>.

228 IBISWorld (2025) Rock, limestone, and clay mining in Australia. <https://my.ibisworld.com/au/en/industry/b0919/at-a-glance>

229 Price data sourced from MJ Rowles Building Products. Building Products – Aggregates. Available at: https://mjrowles.com.au/building-products/ 
(accessed 24 October 2025).



An N25230 concrete blend was used to model the competitiveness and potential demand for carbonated fine aggregate in 
this application. The mix specifications for both blends are described in Table 51. These specifications are used to estimate 
the LCOP of both concrete blends in Table 53. 

Table 51: Input specifications for the modelled concrete blends

CONCRETE BLEND 

MIX 

Concrete blend with carbonated fine aggregate

25% cement.

25% carbonated fine aggregate.

50% coarse aggregate.

Conventional concrete blend

25% cement.

25% sand.

50% coarse aggregate.





CO2 emission intensity values are estimated for both concrete blends (Table 52). 

Table 52: Well-to-wheel life-cycle carbon intensity values of different concrete blends231

PRODUCT

UNIT

TOTAL WELL-TO-WHEEL

Concrete blend with carbonated fine aggregate

tCO2e/t

0.229

Conventional concrete blend

tCO2e/t

0.248





These carbon intensity estimates are then multiplied by the low and high CO2 emission cost assumptions and added to the 
estimated LCOP to calculate total costs for each product under the low and high ambition scenarios in 2050 (Table 53).

Table 53: Estimated LCOP and total cost of concrete blends with CO₂ emission cost in 2050

PRODUCT

UNIT

LCOP

LOW AMBITION

HIGH AMBITION

Concrete blend with carbonated fine aggregate

$/t

56.0

84.3

153.7

Conventional concrete blend

$/t

63.3

93.8

168.7





Forecast domestic demand 

To estimate the demand for each concrete product, the total domestic demand for concrete in 2050 (Table 54) is estimated 
by extrapolating current domestic demand based on projected population growth. This demand is assumed to be inelastic. 
In 2018, around 29 million cubic metres (69.6 Mt232) of pre-mixed concrete was produced in Australia. This was scaled in 
proportion to Australia’s population growth to estimate 2025 and 2050 demand.233 Concrete was employed as the parent 
market for aggregate demand, but carbonated aggregates could have applications in other building products. 

Table 54: Total domestic market size for concrete in 2025 and 2050

PRODUCT

UNIT

2025

2050

SOURCE

Concrete

Mt

76.4

105

CCAA234





230 N25 is a common concrete grade with a compressive strength rating of 25 MPa, it is produced with a ratio of 1:1:2 (i.e. one part cement, one part sand, 
and two parts coarse aggregate)

231 Department of Climate Change, Energy, the Environment and Water (2024) How to calculate embodied carbon of a concrete mix: Fact sheet Rev 01. 
Department of Climate Change, Energy, the Environment and Water, NSW. <https://mecla.org.au/wp-content/uploads/2024/09/DCCEEW-Fact-sheet-
Concrete-emissions-calculation_Rev01.pdf>.

232 Concrete has a typical density of 2400 kg/m3.

233 Australia’s population was 25137059 people at the end of 2018. This is estimated to be reach 27594464 in 2025 and 37973865 in 2050. ABS (2025) 
Population clock and pyramid <https://www.abs.gov.au/statistics/people/population/population-clock-pyramid>. 

234 Cement Concrete & Aggregates Australia (2018) Concrete infographic. <https://www.ccaa.com.au/images/CCAA/Concrete/InfographicThumbnail.
PNG?version=3C753F33>.



This demand is allocated to the cheapest product available, in consideration of relevant feedstock limits described in 
Table 55. 

Table 55: Supply limit assumptions for key feedstocks, carbonated fine aggregate, and concrete containing carbonated fine aggregate 
in 2050

FEEDSTOCK/PRODUCT

UNIT

SUPPLY LIMIT

SOURCES AND ASSUMPTIONS

Steel slag 

Mt

0.96

Australia produced around 4.8 Mt of crude steel in 2024–2025.235 The 2050 
production volume was calculated assuming zero growth to 2050.236 
Steel slag supply is estimated to be 20% of crude steel output.237

Steel slag waste

Mt

0.25

Assumes that the 26% of steel slag output that is currently sent to landfill 
could be utilised for mineral carbonation instead.238 

Steel slag waste allocation 
for carbonated fine aggregate

Mt

0.125

Assumes that 50% of the steel slag waste available could be utilised for 
carbonated fine aggregate production.

Waste concrete

Mt

8.8

Australia generated 26.8 Mt of building and demolition waste in 
2022–23,239 containing approximately 22.9% concrete240. This was scaled to 
2050 in proportion with population growth from 26.3 million in 2022 to 
37.9 million in 2050. 241 

Allocated waste concrete

Mt

1.77

Assumes that a maximum of 20% of waste concrete in Australia could be 
recovered and utilised for carbonated fine aggregate production.

Carbonated fine aggregate

Mt

2.09

Total mass of carbonated fine aggregate that could be produced from the 
steel slag and concrete waste feedstocks. Feedstock input to output ratio 
provided by MCi Carbon.

Concrete blend with 
carbonated fine aggregate

Mt

8.3

Concrete mix blend contains 25% carbonated fine aggregate.





Table 56 shows the forecast demand for concrete products under the different scenarios with the feedstock limits applied. 
The blend with carbonated fine aggregate is the most cost competitive product. However, the potential demand for 
concrete exceeds supply of carbonated mineral aggregate products exceeds the feedstock limits in Table 55. As such, 
the remaining demand is distributed to the conventional concrete blend.

Table 56: Forecast demand for both concrete blends and the related demand for carbonated fine aggregate in 2050 with the 
feedstock limits applied

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Concrete blend with carbonated fine aggregate

Mt

8.3

8.3

Conventional concrete blend

Mt

96.8

96.8

Carbonated fine aggregate

Mt

2.09

2.09





235 Department of Industry, Science and Resources (2025) Resources and energy quarterly: June 2025. Office of the Chief Economist, Canberra. 
<https://www.industry.gov.au/sites/default/files/2025-06/resources-and-energy-quarterly-june-2025.pdf>. 

236 Assumptions informed by industry feedback. 

237 Gao W, Zhou W, Lyu X, Liu X, Su H, Li C, Wang H (2023) Comprehensive utilization of steel slag: A review. Powder Technology 422, 118449. 
<https://doi.org/10.1016/j.powtec.2023.118449>. 15–20% of crude steel output is considered steel slag

.

238 According to IEA, 28% of basic oxygen steel slag goes to the sinter plant, 46% is sold and the remaining 26% goes to landfill. IEAGHG (n.d.) Iron and steel 
CCS study: Techno-economics of integrated steel mill. IEA Greenhouse Gas R&D Programme, Cheltenham, UK. <https://ieaghg.org/publications/iron-and-
steel-ccs-study-techno-economics-integrated-steel-mill/>.

239 Pickin J, Macklin J (2024) National waste and resource recovery report 2024. Department of Climate Change, Energy, the Environment and Water, Canberra. 
<https://www.dcceew.gov.au/sites/default/files/documents/national-waste-resource-recovery-report-2024.pdf>. 

240 DCCEEW (2024) Waste minimisation. YourHome. <https://www.yourhome.gov.au/materials/waste-minimisation>.

241 ABS (Australian Bureau of Statistics) (2025) Population clock and pyramid. <https://www.abs.gov.au/statistics/people/population/population-clock-pyramid>.



CO2 utilisation and abatement potential

CO₂ utilisation for modelled products capturing market share is calculated by multiplying the blend percentage by the 
product’s carbon intensity and the projected market demand. It is assumed that 90% of the utilised CO₂ remains stored 
in carbonated fine aggregates. For the projected 8.3 Mt demand of concrete blend with carbonated fine aggregates, this 
represents around 142,000 tonnes of CO₂ stored. Table 57 shows the total forecast CO2 utilisation for carbonated fine 
aggregate under the different scenarios. 

Table 57: CO2 utilisation potential for carbonated fine aggregate products in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Carbonated fine aggregate

Mt

0.16

0.16





For products modelled to capture market share, CO₂ abatement is quantified for the blend relative to the carbon intensity 
of the incumbent product and applied to its estimated market demand. Table 58 shows the forecast CO2 abatement 
potential for carbonated fine aggregates under the different scenarios.

Table 58: Carbon abatement potential for carbonated fine aggregate products in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Carbonated fine aggregate

Mt

0.15

0.15





Domestic revenue and employment potential

The profit margin of the rock, limestone, and clay mining industry is applied to estimate the revenue associated with 
carbonated fine aggregate demand in 2050. Revenue data from this industry is also used to estimate potential employment 
figures associated with this revenue (Table 59). 

Table 59: Profit margin and revenue per employee industry benchmark242

VARIABLES

VALUE

BENCHMARK INDUSTRY

Profit margin applied to estimate revenue

12.4%

Rock, limestone, and clay mining in Australia

Revenue/employee

$0.64m





Table 60 shows the forecast domestic revenue and Table 61 show the employment potential for carbonated fine aggregate 
under the different scenarios. 

Table 60: Domestic revenue potential for carbonated fine in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Carbonated fine aggregate

$b

0.131

0.131





Table 61: Employment potential for carbonated mineral aggregates in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Carbonated mineral aggregates

FTE

200

200





242 IBISWorld (2025) Rock, limestone, and clay mining in Australia. <https://my.ibisworld.com/au/en/industry/b0919/at-a-glance>



A.7 SCMs assumptions and results

To assess the potential demand for carbonated supplementary cementitious materials (SCMs) in Australia, we model the 
demand for a carbonated SCM (produced from steel waste slag and industrial flue gas containing CO2) by modelling a 
modelling a simplified cement market that considers two cement blends: a reference blend containing only conventional 
SCMs like fly ash and ground granulated blast furnace slag (GGBFS), and a concrete blend also containing a carbonated steel 
slag SCM product. The techno-economic model and input data was partially informed by data provided by MCi Carbon. 

Production and CO2 emission costs 

The LCOP for carbonated SCM (Table 63) was estimated by applying updated cost assumptions (see Appendix A.2, and 
Table 62) and updated data provided by MCi Carbon to a LCOP model developed by CSIRO for the 2021 CO₂ Utilisation 
Roadmap. As some of the data provided by MCi Carbon is confidential, full break down of the cost components is not 
available for this model. 

Table 62: Carbonated SCM input cost assumptions 

INPUT COST ASSUMPTION

UNIT

2050

SOURCE

Steel slag waste 

$/t

0

Steel slag waste is assumed to be procured at zero cost. 

Logistics and transport

$/t

0

It is assumed that there are no logistics and transport costs associated 
with the transportation of feedstocks to the production facility.

Flue Gas (containing CO₂)

$/t

0

Assumed zero cost waste feedstock.





Table 63: LCOP cost for carbonated SCM

PRODUCT

UNIT

2050

Carbonated SCM

$/t

28.75





Cost estimates for cement blend inputs derived from literature are described in Table 64. The costs of OPC, fly ash, and 
GGBFS are estimated by removing average industry profit margins from recent market prices. It is assumed that these 
costs do not increase in real terms between 2025 and 2050. 

Table 64: Input cost assumptions for cement blends

PRODUCT

UNIT

COST

SOURCE

2025

2050

Ordinary Portland Cement (OPC) 

$/t

99

99

The 2025 cost of producing OPC is estimated by removing an assumed 
15.7% profit243 from an average OPC price of $115 per tonne. 244

Fly ash

$/t

97.6

97.6

The 2025 cost of producing flyash is estimated by removing an assumed 
15.7%245 profit from average fly ash price of $113 per tonne.246

GGBFS

$/t

61.6

61.6

The 2025 cost of producing GGBFS is estimated by removing an 
assumed 15.7%247 profit from average GGBFS price of $72 per tonne.248





243 IBISWorld (2025) Cement and lime Manufacturing in Australia. <https://my.ibisworld.com/au/en/industry/c2031/at-a-glance>.

244 IMARC Group. (2025). Cement Prices, Trend, Chart, Demand, Market Analysis, News, Historical and Forecast Data Report 2025 Edition. IMARC Group. 
<https://www.imarcgroup.com/cement-pricing-report

>.

245 IBISWorld (2025) Cement and lime Manufacturing in Australia. <https://my.ibisworld.com/au/en/industry/c2031/at-a-glance>.

246 IMARC Group. (2024). Fly Ash Market: Global Industry Trends, Share, Size, Growth, Opportunity and Forecast 2025–2033. <https://www.imarcgroup.com/fly-
ash-market>

.

247 IBISWorld (2025) Cement and lime Manufacturing in Australia. <https://my.ibisworld.com/au/en/industry/c2031/at-a-glance>.

248 IMARC Group. (2025). Ground Granulated Blast-Furnace Slag (GGBFS) Prices, Trend, Chart, Demand, Market Analysis, News, Historical and Forecast Data 
Report 2025 Edition. IMARC Group. <https://www.imarcgroup.com/ground-granulated-blast-furnace-slag-pricing-report>. 



A reference cement blend containing conventional SCMs like fly ash and GGBFS was used to model the competitiveness 
and potential demand for a carbonated steel slag product in a cement blend with carbonated steel slag SCM. The mix 
specifications for both blends are described in Table 65. These specifications are used to estimate the LCOP of both cement 
blends in Table 67.

Table 65: Input specifications for the modelled cement blends

CEMENT BLEND 

MIX

Cement blend with carbonated SCM

20% carbonated steel slag

25% cement

15% flyash

40% GGBFS 

Cement blend with conventional SCM

25% cement

25% flyash

50% GGBFS





CO2 emission intensity values are estimated for both concrete blends (Table 66). 

Table 66: Well-to-wheel life-cycle carbon intensity values of different cement blends249 

PRODUCT

UNIT

TOTAL WELL-TO-WHEEL

Cement blend with carbonated SCM

tCO2e/t

0.286

Cement blend with conventional SCM 

tCO2e/t

0.343





These carbon intensity estimates are then multiplied by the low and high CO2 emission cost assumptions and added to the 
estimated LCOP to calculate total costs for each product under the low and high ambition scenarios in 2050 (Table 67).

Table 67: Estimated LCOP and total cost of cement blends with CO₂ emission cost in 2050

PRODUCT

UNIT

LCOP

LOW AMBITION

HIGH AMBITION

Cement blend with carbonated SCM

$/t

69.8

104.9

191.2

Cement blend with conventional SCM

$/t

80.0

122.1

225.6





249 DCCEEW (2024) How to calculate embodied carbon of a concrete mix: Fact sheet Rev 01. <https://mecla.org.au/wp-content/uploads/2024/09/DCCEEW-Fact-
sheet-Concrete-emissions-calculation_Rev01.pdf>.



Forecast domestic demand 

To estimate the demand for each product, the total domestic demand for cement in 2050 (Table 68) is estimated by 
extrapolating domestic demand (10.17Mt in 2021250) based on projected population growth.251 Cement was employed as the 
parent market for SCMs, as SCM demand is intrinsically tied to cement production volumes. The total demand for cement is 
assumed to be inelastic.

Table 68: Total domestic market for cement in 2025 and 2050

PRODUCT

UNIT

2025

2050

SOURCE

Cement

Mt

10.9

15

Cement industry federation, Australian Bureau of Statistics (ABS)252





This demand is allocated to the cheapest product available, in consideration of relevant feedstock limits described in 
(Table 69). 

Table 69: Supply limit assumptions for steel slag waste feedstock, carbonated (steel slag) SCM, and cement blend with carbonated 
SCM in 2050

FEEDSTOCK/PRODUCT

UNIT

SUPPLY LIMIT

SOURCES AND ASSUMPTIONS

Steel slag 

Mt

0.96

Australia produced around 4.8 Mt of crude steel in 2024-2025.253 The 
2050 production volume was calculated assuming zero growth to 2050.254 
Steel slag supply is estimated to be 20% of crude steel output.255

Steel slag waste

Mt

0.25

Assumes that the 26% of steel slag output that is currently sent to landfill 
could be utilised for mineral carbonation instead.256 

Steel slag waste allocation 
for carbonated steel slag

Mt

0.125

Assumes that 50% of the steel slag waste available could be utilised for 
carbonated steel slag production.

Carbonated steel slag

Mt

0.15

Total mass of carbonated steel slag that could be produced from the steel 
slag feedstocks. Feedstock input to output ratio provided by MCi Carbon.

Cement blend with 
carbonated SCM

Mt

0.75

Cement mix blend contains 20% carbonated steel slag.





Table 70 shows the forecast demand for cement products under the different scenarios with the feedstock limits applied. 
In both scenarios the demand for SCM products is higher than the feedstock limits in Table 69. As such, the remaining 
demand is distributed to the next cheapest product, the reference cement blend.

Table 70: Forecast demand for both cement blends and the related demand for carbonated SCM in 2050 with the feedstock limits applied

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Cement blend with carbonated SCM

Mt

0.75

0.75

Cement blend with conventional SCM

Mt

14.2

14.2

Carbonated SCM

Mt

0.15

0.15





250 Cement industry federation. Australian clinker and cement production statistics. In 2021, 9.6 Mt cement was produced domestically, and 0.57 Mt cement 
was imported to meet the population demand. Cement Industry Federation (n.d.) Australia’s cement industry. Cement Industry Federation, Australia. 
<https://cement.org.au/australias-cement-industry/about-cement/australias-cement-industry/>.

251 Australia’s population was 25,180,200 people at the end of 2018. This is estimated to be reach 27,613,489 in 2025 and 34,890,378 in 2050. ABS (Australian 
Bureau of Statistics) (2025) Population clock and pyramid. <https://www.abs.gov.au/statistics/people/population/population-clock-pyramid>.

252 Cement Industry Federation (n.d.) Australia’s cement industry. Cement Industry Federation, Australia. <https://cement.org.au/australias-cement-industry/
about-cement/australias-cement-industry/>.

253 Department of Industry, Science and Resources (2025) Resources and energy quarterly: June 2025. Table 3.3. Office of the Chief Economist, Canberra. 
<https://www.industry.gov.au/sites/default/files/2025-06/resources-and-energy-quarterly-june-2025.pdf>.

254 Assumption informed by industry feedback.

255 Gao W, Zhou W, Lyu X, Liu X, Su H, Li C, Wang H (2023) Comprehensive utilization of steel slag: A review. Powder Technology 422, 118449. 
<https://doi.org/10.1016/j.powtec.2023.118449>. 15–20% of crude steel output is considered steel slag.

256 According to IEA, 28% of basic oxygen steel slag goes to the sinter plant, 46% is sold and the remaining 26% goes to landfill. IEAGHG (2013) Iron and steel 
CCS study: Techno-economics of integrated steel mill. IEA Greenhouse Gas R&D Programme, Cheltenham, UK. <https://ieaghg.org/publications/iron-and-
steel-ccs-study-techno-economics-integrated-steel-mill/>.



CO2 utilisation and abatement potential

CO₂ utilisation for modelled products capturing market share is calculated by multiplying the blend percentage by the 
product’s carbon intensity and the projected market demand. It is assumed that 90% of the utilised CO₂ remains stored 
in carbonated SCMs. For the projected 0.7 Mt demand of cement blend with carbonated SCMs, this represents around 
27,000 tonnes of CO₂ stored. Table 71 shows the forecast CO2 utilisation for carbonated SCM under the different scenarios. 

Table 71: CO2 utilisation potential for carbonated SCM in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Carbonated SCM

Mt

0.03

0.03





For products modelled to capture market share, CO₂ abatement is quantified for the blend relative to the carbon intensity 
of the incumbent product and applied to its estimated market demand. Table 72 shows the forecast CO2 abatement 
potential for carbonated SCM under the different scenarios.

Table 72: Carbon abatement potential for carbonated SCM in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Carbonated SCM

Mt

0.04

0.04





Domestic revenue and employment potential

The profit margin from the Cement and Lime Manufacturing industry is applied to estimate the revenue associated with 
carbonated steel slag demand in 2050. Revenue data from this industry is also used to estimate potential employment 
figures associated with this revenue (Table 73).

Table 73: Profit margin and revenue per employee industry benchmarks257

VARIABLES

VALUE

BENCHMARK INDUSTRY

Profit margin 

15.7%

Cement and lime Manufacturing in Australia

Revenue per employee 

$1.2m





Table 74 shows the forecast domestic revenue and Table 75 show the employment potential for carbonated SCM under the 
different scenarios. 

Table 74: Domestic revenue potential for carbonated SCM in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Carbonated SCM

$b

0.01

0.01





Table 75: Employment potential for carbonated (steel slag) SCM in 2050 under low and high ambition scenarios

PRODUCT

UNIT

LOW AMBITION

HIGH AMBITION

Carbonated SCM

FTE

10

10





257 IBISWorld (2025) Cement and lime Manufacturing in Australia. <https://my.ibisworld.com/au/en/industry/c2031/at-a-glance>.



For further information

CSIRO Futures

Dominic Banfield
Senior Manager, CSIRO Futures
Dominic.Banfield@csiro.au

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CSIRO is solving the greatest 
challenges through innovative 
science and technology.

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for everyone.

Contact us

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