How Smarter Policy Could Make or Break Direct Air Capture

Research-driven innovation could slash the cost of direct air capture if policymakers balance near-term incentives with long-term investment.

Breaking the Ice:

In a recent study, researches assess the challenges and opportunities in scaling direct air capture (DAC)—a technology designed to pull carbon dioxide directly from the atmosphere. While DAC is widely seen as a tool for achieving net-zero emissions, today’s price tag, roughly $1,150 per ton of CO₂ removed, makes widespread adoption unlikely without targeted policy action.

The researchers modeled how three policy approaches—incentivizing incremental deployment (“learning by doing”), funding accelerated deployment, and investing in R&D-driven breakthroughs—could alter DAC’s cost trajectory in the U.S. energy system. Using an energy system optimization model paired with learning curve analysis, they explored how quickly costs might drop to $400 per ton under each policy path.

Their findings were clear: incremental deployment alone demands an eye-watering $998 billion in investment to meet that cost target by 2050. Accelerated deployment barely improves on that, shaving off only $7 billion. The game-changer? Research and development. By driving technological breakthroughs, R&D could achieve the same cost reductions at one-third the investment—just $338 billion under their baseline scenario.

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Quick Melt:

Without a sharp drop in cost, DAC will remain a boutique climate solution: too expensive to meaningfully offset the billions of tons of CO₂ the world emits each year.

The study underscores that policy design matters as much as the technology itself. Incremental deployment has value—it builds operational experience and supply chains—but it’s slow and costly. Accelerated deployment, despite its name, offers only marginal savings unless it’s paired with genuine innovation. In contrast, R&D support can “shift the curve” entirely, lowering the starting cost and making every subsequent unit cheaper to deploy.

Even better, R&D remains cost-effective across most scenarios, except in cases where the technology improves extremely rapidly on its own (20% annual learning rate) and R&D breakthroughs are minimal. At more modest learning rates, R&D’s advantages compound, delivering net savings even with small technological gains.

The policy takeaway is that governments shouldn’t choose between early deployment and research—they should combine them. Early projects create the foundation for scaling, while R&D accelerates the point where DAC becomes economically viable. The authors argue this dual strategy will be essential if DAC is to help meet both the U.S. net-zero commitment and the Paris 1.5°C target.

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The Thaw:

How Does Direct Air Capture Work, And Why Is It So Expensive?AccumulationZone Explains.

Direct air capture (DAC) is a technology that removes carbon dioxide directly from the atmosphere. It works by pulling air through large machines that use special materials to bind with CO₂ molecules. In some systems, these materials are solids that hold CO₂ on their surfaces; in others, they are liquids that react chemically with it. Once the material has captured as much CO₂ as it can, the gas must be released so it can be stored underground or used elsewhere. This “regeneration” step often requires substantial heat or other forms of energy to break the bond between the CO₂ and the capture material.

Two parts of the process make DAC costly: moving massive volumes of air through the machines, and regenerating the capture material so it can be reused. Unlike solar panels or wind turbines, which can be mass-produced in factories, DAC systems are large, complex, and customized for each site. That makes it harder to drive down costs quickly through manufacturing efficiency alone.

Engineers and economists describe the way technologies get cheaper over time using learning curves. As more units are built, experience accumulates, and costs typically drop. For DAC, this natural learning process is expected to be slower than for smaller, more modular technologies. That is why R&D is so important. Instead of simply moving down the existing cost curve by building more plants, R&D can shift the curve—lowering the starting cost so that every plant built afterward is less expensive from the beginning.

These shifts could come from new capture materials that need less energy, equipment designs that can be manufactured more easily, or better integration with low-cost renewable energy. In their study, researchers show that pursuing these kinds of innovations is far more cost-effective than relying on deployment alone. Without them, DAC risks staying on a slow and expensive path, limiting its potential as a large-scale climate solution.

Final Thoughts

Early DAC deployment will be important to gain experience and prove the technology at scale. But without strong investment in innovation, costs will fall too slowly to matter. Governments, industry, and researchers will need to work in tandem—deploying plants while also funding the breakthroughs that make those plants dramatically cheaper to build and operate.