Direct Air Capture Deployment and Economic Opportunity: State-by-State

In 2019, Rhodium Group released Capturing Leadership: Policies for the US to Advance Direct Air Capture Technologies which assessed national direct air capture (DAC) levels needed to achieve deep emissions reductions by mid-century in the US and the corresponding federal policies that could support a DAC industry scale-up. Since then, a wave of federal policy support has been enacted to support direct air capture (DAC), including a tax credit of up to $180 per ton of carbon dioxide removed and stored under section 45Q of the tax code and $3.5 billion in funding to support regional direct air capture hubs, a program designed to support companies that are ready to build large demonstration projects and move into early-commercialization. In our annual outlook on US emissions projections, Taking Stock, last year we projected current policy support could deploy up to 84 MMT/yr of direct air capture capacity in the US by 2035, and we anticipate a much larger deployment opportunity by mid-century.

In this analysis, we take a look at what the potential for DAC industry scale-up means for individual states and how they might benefit (Figure 1). We look at the potential to deploy direct air capture capacity at the state-level in the near-term, by 2035, by disaggregating the national-level deployment we find under current policy to the state-level. We also look at how that opportunity expands if the US fully decarbonizes by mid-century (2050), assuming national DAC deployment levels we projected in Capturing Leadership. In our detailed state-by-state data interactive, we show the capital investment in each state as well as the job development benefits from building and operating DAC facilities, including a breakdown by occupation type.

We find that in the near-term, nearly all states have potential to deploy at least one direct air capture facility, and we summarize the top five states with near-term deployment and job development opportunities for DAC in Figure 2.

By mid-century, we find substantial opportunity for DAC deployment and the associated economic opportunity across almost all states. Figure 3 summarizes this opportunity for the top 15 states. Notably, Texas has a very large direct air capture industry and economic opportunity because of its large land area and substantial low-carbon energy and storage resource potential.

Our data interactive below shows state-by-state analysis of direct air capture deployment potential and the corresponding job and economic benefits.

Methodology

This nonpartisan, independent research was conducted with support from the ClimateWorks Foundation (CWF). The results presented reflect the views of the authors and not necessarily those of supporting organizations.