Biogenic CO2 vs Fossil CO2

Biogenic CO2 vs. fossil CO2: Understanding the difference and why it matters more than ever

When we talk about carbon dioxide (CO2), it’s easy to think of it as a single problem: a greenhouse gas driving climate change. But not all CO2 is created equal. Its source, biogenic or fossil, makes a huge difference in how it impacts the environment, our climate targets, and the sustainability of industrial processes.

How CO2 is produced

Fossil CO2

Fossil CO2 originates from carbon stored underground for millions of years in the form of coal, oil, or natural gas. When these fuels are burned for energy or industrial processes, the ancient carbon is released into the atmosphere as CO2.
Examples include:

Power generation from coal-fired plants
Oil refining
Cement production using fossil fuels

Because fossil CO2 comes from carbon locked away for geological time scales, its release adds new carbon to the active carbon cycle, increasing atmospheric CO2 levels.

Biogenic CO2

Biogenic CO2 comes from natural, short-term carbon cycles. It’s produced when organic materials, like plants, crops, or biomass, decompose or are combusted.
Examples include:

Fermentation in breweries
Biogas production from agricultural waste
Combustion of sustainably sourced wood pellets

In theory, the carbon released is balanced by the carbon the plants absorbed during growth. This makes biogenic CO2 part of the natural cycle, rather than a net addition to atmospheric CO2, provided the biomass is sustainably sourced and replenished.

Benefits and drawback

Centralized vs. decentralized production

Fossil CO2 is typically produced in massive quantities at a few centralized industrial sites, such as refineries or ammonia plants. This concentration means supply is abundant at those locations, but customers far away face steep transportation costs.

By contrast, biogenic CO2 production is inherently decentralized, arising from smaller-scale sources like biogas plants, breweries, or agricultural processing facilities scattered across regions. While each site may produce less CO2 and sometimes at a higher cost, this distributed network makes CO2 accessible in places that previously had no local source. For industries once dependent on costly long-distance transport from fossil CO2 hubs, the growth of biogenic CO2 is a game changer.

Rising demand and shrinking fossil supply

In recent years, CO2 demand has surged across multiple industries, from food and beverage carbonation, greenhouse crop enhancement, and water treatment, to dry ice production for logistics and pharmaceuticals. At the same time, many large fossil CO2 production sites are scaling back operations or shutting down entirely, often due to energy market changes, stricter emissions regulations, or shifts in industrial output. This combination of growing demand and declining fossil supply is tightening the CO2 market and driving shortages in several regions. To meet this gap, biogenic CO2 is emerging as a critical solution, offering a renewable, decentralized, and increasingly viable source to keep industries supplied without deepening the fossil carbon footprint.

Why biogenic CO2 is becoming more important

With climate commitments tightening worldwide, industries are under pressure to cut fossil carbon emissions. Biogenic CO2 is gaining traction because it offers a lower-carbon alternative for sectors that still require CO2 as a feedstock or process gas, such as food & beverage, greenhouses, and chemical production.

Key drivers for this shift include:

Net-zero targets: Companies want to reduce their Scope 1 and Scope 3 emissions.
Circular economy principles: Capturing CO2 from renewable processes aligns with closed-loop systems.
Carbon pricing & regulation: Policies increasingly penalize fossil-based emissions.
Consumer demand: Brands can market their products as using "green CO2" boosting sustainability credentials.

The CO2 value chain

The journey of CO2 from source to end-user follows a defined value chain, but the process looks different depending on whether the CO2 is fossil-based or biogenic. First, CO2 is captured at its point of production, for fossil sources, this might be from ammonia plants, refineries, or cement kilns; for biogenic sources, it often comes from fermentation tanks, anaerobic digesters, or biomass energy plants. Next, the CO2 is purified and liquefied, removing impurities to meet industry-grade specifications. From there, it enters the logistics stage, where it is transported in liquid form by road tankers, rail, or pipelines to end-users. Finally, CO2 is utilized in applications ranging from food and beverage carbonation to greenhouse enrichment, dry ice production, and chemical manufacturing. While fossil CO2 supply is often centralized and tied to large industrial hubs, biogenic CO2 can be captured at smaller, distributed sites, potentially shortening transport distances and reducing supply chain vulnerabilities.

The bottom line

Fossil CO2 has been the backbone of industrial supply for decades, but its climate impact is undeniable. Biogenic CO2 offers a sustainable pathway to meet industrial demand while staying aligned with global decarbonization goals, provided it’s sourced and managed responsibly.

The future is clear: as industries transition, biogenic CO2 will play a central role in closing the carbon loop and helping us move towards a truly low-carbon economy.

Biogenic CO2 vs Fossil CO2