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An EU-wide approach is needed \u201cto establish a European single market for industrial carbon management\u201d and meet the Union\u2019s objective of reaching net-zero emissions by 2050, according to the draft policy document, obtained by Euractiv.<\/p>\n\n\n\n
The policy paper, which outlines future policy options and does not contain legal obligations for EU countries or businesses at this stage, is due to be presented on 6 February, alongside another policy document on the EU\u2019s 2040 climate target<\/a>.<\/p>\n\n\n\n It does make clear, however, what the EU\u2019s future climate policy could look like beyond 2030.<\/p>\n\n\n\n To reach climate neutrality, \u201cthe EU will need to be ready to capture at least 50 million tonnes of CO2 per year by 2030\u201d and \u201cup to 450 million tonnes by 2050,\u201d the document says.<\/p>\n\n\n\n This will be essential to counterbalance \u201cresidual emissions\u201d in sectors like agriculture, transport and industry that are unlikely to achieve full decarbonisation by then, the document argues.<\/p>\n\n\n\n Moreover, carbon removals \u2013 sucking CO2 directly from atmosphere \u2013 will also be needed after 2050 in order \u201cto achieve negative emissions thereafter,\u201d it adds.<\/p>\n\n\n\n The end objective, according to the draft Commission paper, is clear: making CO2 a \u201ctradeable commodity,\u201d like gas, crude oil, cotton, wheat, or cocoa.<\/p>\n\n\n\n \u201cBy 2040, a number of regional carbon value chains should become economically viable to meet EU climate objectives, as CO2 will become a tradable commodity for storage or use,\u201d the Commission paper says.<\/p>\n\n\n\n \u201cThese will rely on an EU-wide transport and storage infrastructure with pipelines as the dominant transport means on land,\u201d allowing for cross-border transport of captured CO2 either for storage or use.\u201d<\/p>\n\n\n\n Today\u2019s most widespread form of carbon removals involves planting trees, which suck carbon dioxide from the atmosphere as they grow.<\/p>\n\n\n\n But there are also industrial technologies being developed, such as Direct Air Capture and Storage (DACS) where giant fans suck CO2 straight from the atmosphere and store it permanently, or Bioenergy with Carbon Capture and Storage (BECCS).<\/p>\n\n\n\n The European Commission has already started laying the groundwork for these technologies when it tabled a proposal last year to certify carbon removals<\/a> coming from them. The proposal is now in the final stages of adoption between EU legislators.<\/p>\n\n\n\n To accelerate their deployment, the Commission is now looking for ways of integrating carbon removal technologies into the EU Emissions Trading Scheme (ETS), which obliges more than 10,000 industrial installations in Europe to surrender a permit for each tonne of CO2 they emit.<\/p>\n\n\n\n The revised ETS already \u201cestablishes the possibility of not surrendering allowances\u201d for CO2 emissions that are \u201cconsidered to have been permanently captured and utilised,\u201d the Commission points out in its draft proposal for carbon management due on 6 February.<\/p>\n\n\n\n Moreover, low-carbon fuels such as green hydrogen that meet EU standards under the Union\u2019s updated renewables directive \u201cshould not be subject to surrendering allowances\u201d under the revised ETS in order \u201cto avoid double counting of the embedded carbon,\u201d the paper adds.<\/p>\n\n\n\n For instance, \u201crenewable synthetic fuels\u201d are expected to be of particular importance \u201cnotably in the aviation and maritime sectors\u201d for which binding targets have been set under the ReFuelEU aviation<\/a> and the FuelEU Maritime<\/a> regulations adopted last year, it continues.<\/p>\n\n\n\n Finally, the document says \u201cthe Commission will consider the benefits of setting specific objectives for carbon removals\u201d and consider \u201cby 2026\u201d how this should be \u201caccounted for and covered by emissions trading\u201d.<\/p>\n\n\n\n This could be done either by fully integrating removals under the EU ETS or by creating a \u201cseparate compliance mechanism for such removals connected directly or indirectly to the EU ETS,\u201d the document says.<\/p>\n\n\n\n Environmental groups, although not opposed in principle to carbon capture and utilisation, have plenty of reservations about how such technologies could be incentivised in the future, warning of several pitfalls.<\/p>\n\n\n\n Carbon Market Watch, a green NGO, says the crucial points about carbon utilisation techniques will be to maintain high levels of environmental integrity when it comes to the \u201cpermanence\u201d of the CO2 stored in end products.<\/p>\n\n\n\n \u201cOnly carbon that is captured and utilised in such a way that it is permanently chemically bound and not released during the product\u2019s use or its end of life should be discounted from surrendering obligations,\u201d said Wijnand Stoefs, policy lead on carbon removals at CMW.<\/p>\n\n\n\n For instance, products that risk being burned in a waste incinerator or left to decompose in landfills should not be included, he pointed out, citing plastics, paper products or fuels as examples.<\/p>\n\n\n\n Such types of products \u201chave no place in this discussion,\u201d Stoefs insisted. \u201cOtherwise, we risk enabling another loophole in the EU ETS where companies surrender less or no EUAs because they capture carbon for it to be released by someone else not covered by the scheme.\u201d<\/p>\n\n\n\n When it comes to green hydrogen and low-carbon fuels, Stoefs said standards included in the EU\u2019s Renewable Energy Directive are simply not strong enough to ensure high environmental integrity. \u201cAny carbon released during the production of hydrogen should be accounted somewhere, and preferably priced.\u201d<\/p>\n\n\n\n But the highest risk, according to CMW, would be to fully integrate carbon removals in the existing ETS \u2013 chiefly because it would increase the cap on emissions, allowing polluters to emit more, and deter real emissions reductions by opening the door to carbon offsetting.<\/p>\n\n\n\n Including removals in the existing ETS would also hinder the scale up of permanent removal technologies like Direct Air Capture and Storage, which tend to be costly, and favour \u201ccheap\u201d solutions like BECCS, Stoefs warned.<\/p>\n\n\n\n This is why he said an indirect linkage with the ETS would make more sense \u2013 to fund high-quality, sustainable and permanent removals using EU ETS revenues coming for instance from the innovation fund.<\/p>\n\n\n\n The safest option though, he said, would be to create a separate scheme altogether.<\/p>\n\n\n\nPolicy options for trading CO2 removals<\/strong><\/h3>\n\n\n\n
Reservations from green groups<\/strong><\/h3>\n\n\n\n