Seeking El Dorado: Iceland’s carbon dioxide removal service opportunities to meet global demand and a new lens on overnight transition cost

[Geoengineering News]

https://www.sciencedirect.com/science/article/pii/S1342937X25003715

Authors: Dominik Keiner, Yousef Pourjamal, Siavash Khalili, Christian Breyer

https://doi.org/10.1016/j.gr.2025.11.016

17 December 2025

Highlights

•Large-scale CDR industry opportunities to meet global demand in Iceland analysed.

•Introducing novel method to consider legacy cost in overnight transition modelling.

•CDR industry in Iceland not limited by availability of renewable energy or area.

•Cost for CDR can be achieved around 50 €/tCO2, offering huge economic opportunities.

•Available workforce is bottleneck; ca. 1 GtCO2/a may be realistic upper limitation.

Abstract

Carbon dioxide removal is likely needed to reach the 1.5°C and a more ambitious 1.0°C target rebalancing the climate within planetary boundaries. Research on carbon dioxide removal is usually done either on global scale or for large regions. Dedicated energy system integration of a large-scale carbon dioxide removal industry sector into a national energy system is not yet state-of-the-art. This study closes this research gap for the case of Iceland, one of the most promising countries in the world to act as a carbon dioxide removal hub due to its geologically favourable conditions for in-situ mineralisation, and abundance of renewable energy sources including geothermal energy. Incorporating a novel method to represent the legacy transition cost in an overnight system transition model, several scenarios are applied varying the availability of geothermal energy and carbon dioxide removal service contribution to global demand for ambitious climate targets. The results indicate the requirement of alternative renewable energy sources beyond hydropower and geothermal energy, while large-scale carbon dioxide removal is possible. Renewable power generation capacities are required to significantly increase; onshore wind power, solar photovoltaics, and wave power are identified as additional pillars to supply the energy required. Instead of energy supply, the availability of workforce is identified as the main limitation, and 1 GtCO2/a seems a realistic upper bound for carbon dioxide removal in Iceland. The gross domestic product per capita could be doubled by 2070, turning Iceland into one of the richest countries in the world and the ‘El Dorado’ of carbon dioxide removal.

Source: ScienceDirect