California launches funding round for direct air capture demonstration projects
California has opened a new funding round to support the development and deployment of advanced direct air capture (DAC) carbon dioxide removal technologies through pre-commercial pilot and demonstration projects operating under real-world conditions.
The solicitation aims to accelerate scalable, measurable and verifiable carbon removal solutions capable of addressing legacy greenhouse gas emissions, while helping advance long-term carbon neutrality goals.
The programme focuses on DAC technologies at Technology Readiness Level (TRL) 6 or above, requiring applicants to demonstrate that systems have progressed beyond laboratory validation and are capable of integrated operation in representative environments. Projects must also show a pathway to advancing by at least one TRL during the project period.
To qualify, projects must position DAC as the primary source of performance outcomes and demonstrate system-level or subsystem operation under real-world atmospheric CO₂ concentrations. DAC systems may operate as stand-alone facilities or alongside other carbon removal pathways, industrial processes or grid-responsive energy systems, provided the DAC component remains central to project performance.
The funding round establishes minimum technical targets to be achieved by project completion, including carbon capture costs of no more than $450 per metric tonne of CO₂, combined energy consumption below 1,400 kilowatt-hours per metric tonne of CO₂, and annual net CO₂ removal capacity of at least 500 metric tonnes.
Projects linked to enhanced oil recovery or oil and gas operations are excluded from eligibility.
Applicants are required to partner with entities representing host communities and are encouraged to engage local stakeholders, community-based organisations and disadvantaged communities to support equitable economic and environmental outcomes.
At least 7% of California Energy Commission funding must be allocated to community engagement activities, including outreach, education and long-term participation by affected communities and tribal organisations.
Preference will also be given to projects that include detailed clean energy procurement plans outlining the use of low- or zero-carbon electricity, thermal energy or fuels, alongside strategies supporting grid flexibility and emissions reduction.
Applicants must submit detailed project narratives covering technical design, system performance, environmental impacts, life-cycle analysis, techno-economic assessments, carbon management strategies, permitting status and demonstration site readiness.
The California Energy Commission said the programme is intended to help overcome persistent DAC challenges related to cost, energy intensity and systems integration, while supporting commercial readiness and large-scale deployment potential.
Projects demonstrating strong environmental performance, scalable economics and credible technical validation under operational conditions are expected to receive priority consideration.
