The value of CO2 point source capture for the energy-industry system transition

Many countries are working to reduce greenhouse gas emissions by phasing out fossil fuels and expanding low-carbon energy sources such as wind power and solar photovoltaics. Nordic countries face unique challenges due to harsh climatic conditions and high shares of energy-intensive industries in their total demand. While fossil fuel-related emissions can be eliminated, emissions from point sources, including biomass plants, pulp and paper mills, waste incinerators, and cement plants, will remain. These unavoidable emissions present an opportunity to convert CO2 into valuable e-fuels and e-chemicals via power-to-X processes. This study presents the first techno-economic system-level comparison of point source capture (PSC) and direct air capture (DAC) under Nordic conditions, with multiple point source categories included in the assessment. The case of Finland is analysed using the LUT Energy System Transition Model, optimising system costs in five-year steps towards a renewable energy-based system by 2050. Two scenarios are compared: one combining PSC and DAC, and one relying entirely on DAC. Results indicate that with PSC, the system sources CO2 almost exclusively from point sources, reducing annual system costs by 2.5% and average cost of e-Fischer-Trosch liquids and e-methanol by 8-13% compared to a DAC-only system. The optimal system enhances efficiency, land use, resource use, and provides environmental, economic, and societal benefits. The findings offer actionably insights for policymakers and industry stakeholders in Finland, the Nordics, and beyond, supporting cost-effective power-to-X pathways and accelerating the energy transition.