The report, "Unlocking Private Capital for Carbon Capture and Storage", sets out a practical roadmap for the finance sector to play a role in accelerating the mobilization of private finance for global CCS deployment.

View the full report here

Produced under the SMI FSTF "CCS Lighthouse Project”*, the report finds that CCS represents a multi-billion-dollar investment opportunity. However, despite this opportunity, there is a structural financing gap. As a result, independent capture-side developers often lack access to late-stage development capital and long-term revenue certainty to reach final investment decision (FID). Many early CCS projects have depended heavily on government support, rather than operating on a merchant basis — a model that is not scalable.

To close the financing gap and scale private capital mobilization, the report recommends an integrated, three-part strategy for SMI FSTF member banks and the wider finance sector.

1. Unlock stalled projects by establishing a pre-FID development capital fund

   The financial services sector could explore committing to a multimillion-dollar catalytic development fund to support capture projects approaching FID. Targeting high-impact markets such as the Nordics and the US, the fund could provide flexible instruments, including equity, debt, and guarantees, to de-risk late-stage project costs and crowd in institutional capital. The report identifies over 130 near-term projects globally that could benefit from this funding .

2. Create bankable revenue streams by aggregating demand and structuring offtake solutions
   The financial services sector can bring together coalitions of buyers for CO₂ removal credits and low-carbon products and services (e.g. through environmental attribute certificates), pooling demand and offering credit enhancement tools to secure long-term offtake. By converting voluntary pledges into investment-grade contracts, these coalitions will provide the revenue certainty needed to attract bank and investor finance.

3. Accelerate learning cycles and investor confidence via a global CCS financing lessons forum

   The report calls for a global CCS financing lessons forum, organized by a credible third party, to share best practices on structuring, risk allocation, and policy alignment. The forum could host case studies and peer-to-peer learning to accelerate market maturity, reduce the cost of capital, and shorten the time to FID.

To get to net zero by 2050, the International Energy Agency (IEA) estimates CCS could deliver up to 8% global emissions reduction from 2022-2050, around ~ 6 GtCO2/yr by 2050, or equivalent to taking every car and van on earth off the road, more than one and a half times over.

These three integrated recommendations will play an important role in supporting the sector. Encouragingly, the study reveals market fundamentals are improving, policy is spreading, carbon prices are expected to rise, and green premiums and decarbonization credit markets are beginning to emerge.

The project pipeline is expanding rapidly, with operational facilities up 54% year-on-year and 117 projects targeting final investment decision (FID) before 2027 The UK, Nordics, and US Gulf Coast are leading the way, shifting towards more market-based frameworks, and developing regulatory and offtake models that can attract private investment.

C.S. Venkatakrishnan, Barclays Group Chief Executive and Chair of the Sustainable Markets Initiative’s Financial Service Task Force said, "The technical capability of carbon capture and storage is proven and, in key markets around the world, commercial and policy frameworks are in place to connect supply and demand. The foremost remaining challenge, therefore, for accelerated deployment of CCS at scale, is enabling an influx of private capital into the sector. This report proposes practical actions to unlock that investment."

Jennifer Jordan-Saifi, CEO of the Sustainable Markets Initiative said, "Carbon capture and storage can be a key enabler of the sustainable transition, but it requires confidence, collaboration and capital to move from ambition to action. By aligning capital, policy, and industrial capability we have the opportunity to progress CCS from a promising technology into a core pillar of transition, which can help deliver lasting, system-wide change."

David Hatcher - Managing Partner of Baringa said, "Carbon capture and storage is essential, not an option. It is key to unlocking whole-economy decarbonisation and kickstarting a huge investment opportunity in a rapidly growing asset class. This report provides a clear, actionable pathway for the finance sector to help scale CCS deployment globally. At Baringa, we’re proud to support this work and work towards helping unlock the capital, confidence, and collaboration needed to accelerate the transition to net-zero."