The European Commission will lay out a strategic vision for carbon capture, utilisation and storage (CCUS) in Europe in 2023, EU Commissioner for Energy Kadri Simson announced at the EU’s annual CCUS Forum in Oslo, Norway, just before COP27. This is a moment the European CCUS industry has been awaiting for a long time; the EU’s CCS Directive dates back to 2009 and the industry has struggled to attain commercial viability even as it remains firmly embedded in net-zero road maps. Now the Commission is planting its flag: without CCUS, the EU will not reach climate neutrality by 2050.
Simson’s announcement follows renewed European interest in this technology. In the last few years, there have been dozens of new CCUS project announcements across Europe, including eight in the Netherlands alone, and significant funding commitments in some member states like Denmark, which has committed potentially up to €5bn ($5.03bn) for CCS. Furthermore, policy recognition at the EU level (such as the inclusion of CO2 transport and storage in the Trans-European Networks for Energy Regulation, which renders these projects eligible to apply for EU funds) has made the investment case for CO2 infrastructure stronger.
However, without high-level political EU buy-in, these individual steps are likely to fall short of what is required. The Commission’s own modelling of scenarios consistent with 1.5°C indicates that between 280 and 600 million tonnes of annual CO2 capture, long-term use and storage will be required within the region by 2050, primarily to help decarbonise energy-intensive industries and remove already-emitted CO2 from the atmosphere (‘carbon removal’).
Today, not a single commercial-scale CCS facility is operating in the EU. More broadly, the International Energy Agency’s World Energy Outlook 2022 shows that although planned CCS facilities are growing rapidly at global level, they represent only about 20% of what is required for the world to reach net zero by 2050.
Back in Europe, reliance on the EU carbon price alone is still not sufficient to commercialise many essential climate action technologies, including CCS, despite climbing to more than €90 a tonne in 2021.
A lack of coordination between projects and across funding mechanisms has prevented economies of scale and kept costs high for early movers. In addition, many regulatory barriers remain – particularly for the cross-border transport of CO2. Tangible CCS developments are limited to a handful of member states, largely around the North Sea, but other regions will need access to CO2 infrastructure if there is to be Europe-wide industrial decarbonisation.
Without a clear deployment plan, this crucial climate technology will not reach the scale required, and without that the climate ambitions of the Green Deal will not materialise. However, the Commission has successfully tackled a similar problem in the not-so-distant past.
CCS in Europe: Learning from hydrogen
In 2020, the Commission adopted a first-ever EU Hydrogen Strategy, which laid out a vision for the creation of a European hydrogen ecosystem. Hydrogen and all the technologies used to produce, transport and use it also features heavily in Europe's net zero by 2050 scenarios.
For years, climate policy in Brussels focused on decarbonising the electricity grid and increasing energy efficiency. This led to a steady decline in the carbon intensity of the EU’s electricity supply but largely left transport and industry -– collectively responsible for close to 50% of Europe’s emissions -– untouched.
With the ramp up in climate ambition and the adoption of net zero by 2050 as a legally binding target, that situation could not continue. Businesses around Europe were being told to reduce their emissions, but the policy tools and technologies available to them were ill-matched to the task. Complex industrial processes and long-haul, heavy-duty transport such as shipping, trucking and aviation cannot reach net-zero emissions with clean electricity alone. The Hydrogen Strategy offered support for an alternative route – clean hydrogen can replace fossil gas in at least some cases – but it is a long way from solving the huge array of decarbonisation needs found across the bloc. For example, the EU’s cement and lime industry emits more than 130 million tonnes of CO2 per year, two-thirds of which are unavoidable emissions from the process chemistry – and yet sectors like these are foundational to our economy. They will need CCS options to meet their decarbonisation targets.
Earlier this year, the Clean Air Task Force proposed a policy framework for carbon capture development in Europe, providing the analytical basis for an EU-wide CCS strategy. The report assesses current policies, project developments and deployment rates, as well as how the Commission, member states and private actors could accelerate CCS development.
The Commission is starting to take action. Months of working group activity culminated in the CCUS Forum in Oslo, which brought together the right stakeholders to make CCS in Europe a reality.
Nevertheless, significant challenges remain. Citizen buy-in, investment, cross-border infrastructure – particularly CO2 storage – and timely permits are all key issues that must be solved.
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Thousands of people are working on this across industry, academia, government and civil society. There are nearly 60 CCS projects planned in Europe, with the potential to lock away up to 70 million tonnes of CO2 per year – roughly similar to the annual savings from solar power displacing modern gas power plants. To keep pace with European climate ambitions, we will need nearly all of these projects to succeed by 2030, as well as a significant increase in sites that are ready to permanently store captured CO2.
The next stage is getting projects up and running, improving efficiencies and reducing costs: a process that we have already been through with renewables. As the solar and offshore wind industries have taught us, the real learning comes when we get steel in the ground. That is when costs start to come down and modelling becomes reality.
CCS is not something we will need just in Europe, it is a major part of net-zero road maps around the world. If we get an EU-wide policy road map correct, Europe could not only tackle the obstinate emissions of its transport and industry sectors; it could become the vanguard of another crucial climate technology.