{"id":175934,"date":"2026-04-22T07:20:00","date_gmt":"2026-04-22T05:20:00","guid":{"rendered":"https:\/\/renewable-carbon.eu\/news\/?p=175934"},"modified":"2026-04-16T16:05:57","modified_gmt":"2026-04-16T14:05:57","slug":"policy-and-financing-momentum-sustain-ccus-progress-despite-setbacks","status":"publish","type":"post","link":"https:\/\/renewable-carbon.eu\/news\/policy-and-financing-momentum-sustain-ccus-progress-despite-setbacks\/","title":{"rendered":"Policy and financing momentum sustain CCUS progress despite setbacks"},"content":{"rendered":"\n\n\n

Efforts to expand carbon capture, utilisation and storage (CCUS) took some important steps forward in 2025. Despite delays and cancellations in some areas, projects reached notable milestones in key markets, while growing financing provided further momentum.<\/strong><\/p>\n\n\n\n

CCUS deployment in Europe saw a step-change as the world\u2019s first dedicated carbon dioxide CO2<\/sub> storage hub\u00a0began operating in Norway<\/a>. Major projects were also commissioned in\u00a0China<\/a>\u00a0and\u00a0North America<\/a>, and the construction of new facilities began in eight countries worldwide. The newest annual update to the IEA\u2019s\u00a0CCUS Project Database<\/a>\u00a0\u2013 which incorporates developments between the first quarter of 2025 and the first quarter of 2026 \u2013 found that capture capacity that was operational or under construction during this period was over 10% higher than in the previous Database update, which covered the first quarter of 2024 through the first quarter of 2025. Meanwhile, storage capacity increased by around 25%. In terms of future prospects, the total potential capture capacity remained at similar levels of around 425 million tonnes (Mt) \u2013 although the timeline for deploying much of this planned capacity has been pushed back towards 2035 amid delays in permitting and construction, as well as broader market uncertainties.<\/p>\n\n\n\n

Insights from our forthcoming publication,\u00a0Financing CCUS at Scale<\/a>, show that more than USD 15 billion in commercial debt has been raised over the past two years \u2013 almost exclusively in markets where the government reduced risks across CO2<\/sub> capture, transport and storage, providing enough certainty and confidence for lenders and investors to step in. This suggests that new CCUS policies are helping spread project risks across the public and private sectors, which in turn is allowing unprecedented levels of private capital to flow into projects. Ensuring this extends beyond a small number of projects, however, will require additional policy support to enable viable business models and target specific risks that need to be addressed for more projects to reach final investment decisions (FIDs).<\/p>\n\n\n\n

Evolution of announced capacity for 2035 by status across editions of IEA CCUS Projects Databa<\/strong>se<\/a><\/p>\n\n\n\n

\"Includes
Includes all operational, under construction and planned CO2<\/sub>\u00a0capture and storage facilities with an announced capacity of more than 100 000 t CO2<\/sub>\u00a0per year or 1000 t CO2<\/sub>\u00a0per year for direct air capture facilities and an announced timeline. \u00a9 IEA (2026),\u00a0CCUS Projects Database<\/a>.<\/figcaption><\/figure>\n\n\n\n

Supportive policies are unlocking private capital in select markets<\/h3>\n\n\n\n

Regionally, Europe and the Middle East saw the strongest gains in 20251<\/a>, with both capture and storage capacity expanding. North America also recorded significant additions in CO\u2082 storage capacity, although progress on capture was tempered by the pause or delay of many projects.<\/p>\n\n\n\n

Recent progress was enabled by targeted government support that helped strengthen project economics and reduce investment risks. In Europe, long\u2011term revenue guarantees \u2013 mostly through carbon contracts for difference \u2013 together with risk\u2011sharing mechanisms have enabled higher\u2011cost capture projects (such as those associated with\u00a0cement<\/a> production) and major\u00a0transport and storage hubs<\/a>\u00a0to reach FIDs. In North America, tax credits continued to underpin capture projects, particularly in low\u2011cost applications such as\u00a0fertiliser<\/a>\u00a0and\u00a0bioethanol<\/a>.\u00a0<\/strong>In the Middle East, progress was supported by\u00a0hydrocarbon operations<\/a>\u00a0and anticipated demand for low\u2011emissions fuels and materials, with risks largely managed by the participation of state-owned oil and gas companies as project sponsors.<\/p>\n\n\n\n

Commercial bank lending flowing into the sector has reached unprecedented levels. However, it remains heavily concentrated in markets with strong frameworks for reducing the financial risks associated with CCUS projects. The United Kingdom, which combines long\u2011term contracts for emitters, cross\u2011chain compensation mechanisms and a government backstop for long\u2011term risk exposure, accounted for around 85% of this financing over the past two years.<\/p>\n\n\n\n

Evolution of capacity either operational or under construction by region between 2025 and 2026 editions of IEA CCUS Projects Database<\/h3>\n\n\n\n
\"\n\nThe
The increase in operational capacity in South America reflects updated data for the CO2<\/sub>\u00a0injection project in the Santos Basin, which was not captured in previous editions of the database. \u00a9 IEA (2026),\u00a0CCUS Projects Database<\/a>.<\/figcaption><\/figure>\n\n\n\n

Evolution of capture capacity either operational or under construction by sector between 2025 and 2026 editions of IEA CCUS Projects Database<\/h3>\n\n\n
\n
\"\"
\u00a9 IEA (2026),\u00a0CCUS Projects Database<\/a>.<\/figcaption><\/figure><\/div>\n\n\n

<\/a>Weak demand and delays held back project development in some sectors and markets<\/h3>\n\n\n\n

At the same time, several segments of the CCUS sector faced growing headwinds in 2025. This was notably the case for projects that plan to capture CO2<\/sub> from hydrogen<\/a> production facilities, which struggled to advance globally due to the lack of firm long\u2011term offtake agreements. This led to pauses or delays \u2013 even for projects that had already reached FIDs, including major developments in the United States<\/a> and Canada<\/a>. Even in markets with government\u2011backed demand frameworks, such as the United Kingdom, several announced CCUS projects linked to hydrogen were cancelled<\/a>.<\/p>\n\n\n\n

Carbon dioxide removal (CDR) projects faced similar difficulties securing bankable demand. The biomass-fired district heating plant<\/a> operated by Stockholm Exergi in Sweden stood out as a rare example of a bioenergy with carbon capture and storage (BECCS) project that moved forward with substantial offtake commitments, but this remained the exception rather than the norm. Several planned BECCS projects in Sweden<\/a> and elsewhere were cancelled or delayed in 2025. Developers struggled with uncertainty in the voluntary carbon market<\/a>, particularly with the lack of liquid long-term contracts needed to support project financing.<\/p>\n\n\n\n

In the United States, projects associated with high capture costs that typically go over the USD 85 per tonne tax credit (as is typically the case with industry and power applications) faced delays and cancellations, particularly after the withdrawal of major government grants<\/a> to fund detailed engineering studies. Emerging interest<\/a> from data centres in CCUS as a pathway to securing firm, low\u2011emissions power also has yet to materially shift the broader challenges facing capture projects in these sectors. Permitting also remains a bottleneck in US states for which storage permitting is overseen at the federal rather than state level, slowing the development of new storage sites and causing the delay of planned projects to 2035. On the transport side, community concerns  continued to constrain new CO\u2082 pipeline development<\/a>, with the Trailblazer project<\/a> standing out as an exception because it repurposed an existing natural gas pipeline.<\/p>\n\n\n\n

What to look for in 2026<\/h3>\n\n\n\n

As CCUS markets continue to develop, the IEA will monitor what this means for policymakers, financiers and the energy system, including through granular tracking of the hundreds of planned projects.<\/p>\n\n\n\n

In 2026, several major CCUS projects are expected to reach further key milestones. The\u00a0Porthos<\/a>\u00a0project in the Netherlands is set to begin operations, becoming Europe\u2019s second large\u2011scale CO\u2082 transport and storage network. In the United Kingdom, remaining\u00a0Track\u20111 capture projects<\/a>\u00a0should progress toward construction. Additional momentum in storage development is anticipated in the Mediterranean, with Italy\u2019s\u00a0Ravenna Phase 2<\/a>\u00a0and Greece\u2019s\u00a0Prinos CO2<\/sub><\/a> projects both expected to reach final investment decisions. At the same time, many CCUS projects that are tied to oil and gas operations in the Middle East face significant uncertainty in the current geopolitical context.<\/p>\n\n\n\n

Against this backdrop, several emerging trends could shape the year:<\/p>\n\n\n\n

The gap between capture and storage development could widen<\/strong> in 2026, creating uncertainty for transport and storage developers. Storage projects continue to move ahead \u2013 with several large sites under construction or approaching FID \u2013 yet committed capture volumes are not keeping pace. The decision of the Norwegian oil and gas company Equinor to scale back parts of its storage investment plans<\/a> illustrates the risks of under\u2011utilised infrastructure. Without clearer demand signals, some developers may hesitate to proceed, reinforcing the need for policies that provide greater volume certainty.<\/p>\n\n\n\n

New markets could also emerge.<\/strong>\u00a0A wave of new government frameworks for CCUS are poised to broaden the geographic base of deployment. In\u00a0Germany<\/a>,\u00a0France<\/a>\u00a0and Japan, new long-term revenue schemes could help lower revenue risks for capture project developers, stimulating demand for shared infrastructure. India\u2019s new\u00a0USD 2.2 billion<\/a> industrial decarbonisation support package could also open opportunities for early projects, particularly in hard\u2011to\u2011abate sectors.<\/p>\n\n\n\n

Regulatory alignment will determine the pace of cross\u2011border CO\u2082 shipping in Southeast Asia.<\/strong> While it remains a key area of interest, momentum has softened as some major oil and gas companies have stepped back from planned CCUS investments, suggesting the region may be entering a consolidation phase. Policy clarity and regional cooperation will be essential to unlock continued progress.<\/p>\n\n\n\n

Risk\u2011sharing mechanisms will be critical to catalyse private capital.<\/strong>\u00a0Steps forward in 2025 underscored the importance of robust risk\u2011sharing frameworks, as did some setbacks. In Europe, several companies withdrew their bids from\u00a0Denmark\u2019s CCUS fund<\/a>\u00a0amidst concerns that risks associated with the availability of transport and storage infrastructure were too high. Targeting support to address the specific risks that matter most \u2013 long-term revenue certainty, volume risk mitigation and clear liability allocation \u2013 will be essential for the next wave of projects to reach FID.<\/p>\n\n\n\n

1<\/sup>The increase in operational capacity in South America reflects updated data for the CO\u2082 injection project in the Santos Basin, which was not captured in previous editions of the database.<\/sub><\/p>\n\n\n\n

<\/div>\n\n\n\n

CCUS Projects Explorer<\/h3>\n\n\n\n

Covers all large-scale CO2 capture, transport, storage, and utilisation projects commissioned or in planning worldwide<\/p>\n\n\n\n

<\/i>Use Data Explorer<\/span><\/a><\/div>\n\n\n\n
<\/i>Get Data<\/span><\/a><\/div>\n\n\n\n
<\/div>\n","protected":false},"excerpt":{"rendered":"

Efforts to expand carbon capture, utilisation and storage (CCUS) took some important steps forward in 2025. Despite delays and cancellations in some areas, projects reached notable milestones in key markets, while growing financing provided further momentum. CCUS deployment in Europe saw a step-change as the world\u2019s first dedicated carbon dioxide CO2 storage hub\u00a0began operating in […]<\/p>\n","protected":false},"author":59,"featured_media":175952,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_seopress_robots_primary_cat":"none","nova_meta_subtitle":"The newest annual update to the IEA\u2019s CCUS Project Database \u2013 which incorporates developments between the first quarter of 2025 and the first quarter of 2026 \u2013 found that capture capacity that was operational or under construction during this period was over 10% higher than in the previous Database update","footnotes":""},"categories":[5571],"tags":[5842,10744,21452,12330,23205,10743],"supplier":[8202,25620],"class_list":["post-175934","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-co2-based","tag-biomass","tag-carboncapture","tag-carbonstorage","tag-ccu","tag-eu-policies","tag-useco2","supplier-iea-bioenergy","supplier-stockholm-exergi"],"_links":{"self":[{"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/posts\/175934","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/comments?post=175934"}],"version-history":[{"count":1,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/posts\/175934\/revisions"}],"predecessor-version":[{"id":175954,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/posts\/175934\/revisions\/175954"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/media\/175952"}],"wp:attachment":[{"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/media?parent=175934"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/categories?post=175934"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/tags?post=175934"},{"taxonomy":"supplier","embeddable":true,"href":"https:\/\/renewable-carbon.eu\/news\/wp-json\/wp\/v2\/supplier?post=175934"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}