For years, one tantalising figure has dominated conversations around the economics of direct air capture: the idea that removing a tonne of carbon dioxide from the atmosphere should cost at most $100 to be economically acceptable.
This magic number has been repeated time and time again, adopted by DAC companies, investors, and industry bodies alike. But where did it come from? And does it hold up under scrutiny?
We’ve pinpointed the origins of the $100 per tonne target and explored why it sets an unrealistic benchmark for scaling a brand new climate technology — offering instead a more practical view of how we can drive down the cost of DAC as quickly as possible.
Where did the $100 price tag for direct air capture come from?
Throughout its relatively short history, the cost of direct air capture has been widely debated. Once weighed down by criticisms of its efficiency and cost, the first wave of DAC developers had to prove that although this nascent technology was still maturing, it was a much-needed piece of the puzzle in fighting the climate crisis.
In 2018, Carbon Engineering published a peer-reviewed paper estimating that their technology would hit between $94/tCO2 and $232/tCO2 and announced that ‘CO2 can now be captured from the atmosphere for less than $100USD per ton’. Since then, the $100 figure has grown into the commonplace benchmark that crowds conversations around the cost of direct air capture today.
Three years later at COP26, the US Department of Energy announced their Carbon Negative Shot initiative, designed to support goals to reach net-zero emissions by 2050. This included scaling direct air capture — targeting carbon dioxide removal (CDR) technologies that could remove CO2 from the atmosphere and durably store it for at least 100 years at a cost of less than $100/net metric tonne of CO2, cementing the figure in place.
These early projections were based on ideal conditions — favourable energy prices, rapid technological breakthroughs, and the kind of cost reductions seen in other industries, such as wind power. They were certainly ambitious and served motives beyond basic cost reporting. Yet, they did not fully account for real-world constraints, including inflation, supply chain limitations, and variable global policy infrastructure.
CCS vs DAC: It’s important to note the difference between carbon capture and storage (CCS) and direct air capture in the context of cost. Although CCS is often cheaper than DAC, they are fundamentally different technologies, serving very different purposes and delivering vastly different climate impacts. Both are separately crucial for net zero goals.
💡 Learn more: What sets DAC apart from CCS technology?
Why $100/tCO2 direct air capture cost isn’t realistic today
Even with rapid scaling, a 2024 study by ETH Zürich and the Institute for Science, Technology and Policy estimates the cost of a tonne of captured CO2 from DAC to fall in the range of $230 – $540 by 2050 — bringing welcome adjustment to what was always a speculative target. Here’s a closer look at why $100 set an unrealistic benchmark for a brand new industry.
Direct air capture cost vs. other commodities
One of the simplest ways to illustrate the flaws of pricing atmospheric CO2 at $100 per tonne is to compare it to the other industrial materials that hit this price point, like cement — an established, mass-produced global product projected to reach a global average of $97 per metric tonne in 2025, following a 2.2% yearly increase in cost. In the US alone, cement has gone up 33% in cost since 2018 – the same year that the $100 DAC target was born. This translates to a 4.9% yearly increase over the period, impacting a hyper-mature, widely established product.
Unlike DAC, cement production is already benefiting from economies of scale and a well-optimised supply chain that has been refined over centuries. Yet, even with these advantages, cement prices continue to rise due to raw material costs, energy demands, and inflation. However, the comparison does highlight potential for DAC; with time, scaling, and continued innovation, costs can decline to levels that make widespread adoption feasible.
DAC CO2 cost across different economies
The $100 per tonne DAC CO2 cost target was born in the US, yet has become globally adopted as a blanket figure for “affordable” direct air capture, massively oversimplifying and neglecting fluctuations between different economies, regulation, and legislation.
Deals to date that have come close to $100 per tonne likely account for government assistance in the form of subsidies or tax breaks, which vary in availability between jurisdictions. What’s more, pre-purchase agreements aren’t always an accurate indicator of price, as they can be leveraged to balance cash flow, even if it means selling at a loss.
While $100 per tonne isn’t necessarily a realistic benchmark, that doesn’t mean DAC isn’t a viable and essential solution – it just means we need to recalibrate our expectations, focusing on making direct air capture as cost-effective as possible, whilst accounting for the many economic variables at play.
Bringing down direct air capture’s cost
Global direct air capture costs may not be aligned with the $100/tCO2 benchmark, but that’s not to say that they can’t continue to drop alongside technological and policy advancements.
DAC is becoming more affordable and accessible thanks to:
- Policy support: Government incentives, tax credits, and carbon pricing mechanisms are helping bridge the cost gap and accelerate deployment;
- Technological advancements: Ongoing research and development mean new physical and chemical configurations continue to emerge, resulting in improved efficiency and contributing to lower capital and operational costs;
- Economies of scale: As more DAC plants are built, manufacturing efficiencies and shared infrastructure will lower costs;
- Renewable energy integration: Renewable power is the cheapest source of power available, reducing the operational costs of DAC. What’s more, direct air capture can empower renewable energy by helping to solve curtailment.
Moving beyond arbitrary direct air capture cost targets
It’s safe to say that it’s unrealistic to expect a figure set over five years ago to account for all of the economic variables impacting the cost of direct air capture CO2 today. The question now should not be whether a brand new technology can reach an outdated cost target, but how global governments and industry can cultivate the underlying economic conditions for the most effective direct air capture technologies to scale as quickly as possible.
