As the European Union races to meet its legally binding climate targets, the need for large-scale deployment of carbon capture and storage (CCS) technologies has become increasingly clear. CCS is recognized as a critical emissions-reduction pathway, able to tackle hard-to-abate sectors like industrial manufacturing and power generation. Yet despite significant technological progress, Europe has struggled to catalyze wide-scale CCS adoption, hindered by regulatory uncertainty and a lack of coordinated policies.
To enable CCS at the pace and scale required, the EU and national governments must develop comprehensive regulatory frameworks that address the full CCS value chain—from capture to transport to secure underground storage. These frameworks must provide clear rules, market incentives, and risk-sharing mechanisms to drive private investment into first-of-a-kind and nth-of-a-kind CCS projects. Crucially, they must also foster the development of shared CCS infrastructure, which can serve multiple emitters and reduce individual project risks.
The development of robust CCS regulations is a complex, multi-faceted challenge. It requires aligning legal and permitting processes, establishing environmental impact monitoring protocols, and addressing long-term liability concerns. But with smart policy design and close collaboration between policymakers, industry, and civil society, Europe can catalyze a rapid expansion of CCS and unlock its essential role in the continent’s decarbonization efforts.
Policy and Legal Frameworks
The EU’s CCS Directive, introduced in 2009, established a foundational regulatory framework for the geological storage of CO₂. It set out rules for selecting suitable storage sites, operating injection facilities, and transferring long-term storage liability to national authorities. This directive has been a crucial first step, but its implementation has varied significantly across Member States.
Some countries, such as the Netherlands and Norway, have developed comprehensive CO₂ storage regulations and permitting processes. Others, like Germany and Austria, have effectively prohibited onshore storage due to public opposition. Inconsistent national approaches have created regulatory uncertainty and hindered the development of cross-border CCS networks.
To address this challenge, the EU could develop harmonized guidelines for CCS regulations, helping to ensure a level playing field across Member States. This could include standardized procedures for storage site characterization, monitoring requirements, and the management of long-term liabilities. Crucially, these guidelines should also provide clarity on the legal ownership and access rights to the pore space where CO₂ is stored—a critical issue that has slowed progress in some countries.
Beyond storage, the regulatory framework must also address the full CCS value chain, including the transport of CO₂ via pipelines, ships, and other modes. The London Protocol, an international agreement governing the dumping of wastes at sea, currently prohibits the cross-border transport of CO₂ for storage purposes. While an amendment was adopted in 2009 to allow such activities, it has yet to enter into force due to insufficient ratifications.
The EU can play a vital role in resolving this impasse, either by facilitating bilateral agreements between Member States or by developing a multilateral framework to enable seamless cross-border CO₂ transport. Regulations should also provide clear guidelines on technical standards, safety requirements, and liability allocation for different transportation modes.
Environmental Impact Assessments
Any large-scale deployment of CCS must be accompanied by rigorous environmental impact assessments (EIAs) to ensure the safety and sustainability of storage sites. These assessments should evaluate potential risks, such as CO₂ leakage, groundwater contamination, and induced seismicity, and establish comprehensive monitoring and verification protocols.
Effective monitoring is essential for maintaining public trust in CCS and demonstrating the long-term integrity of storage sites. Regulations should mandate continuous measurement of CO₂ concentrations, injection pressures, and other key parameters, with data transparently reported to regulators and the public.
In the event of unexpected CO₂ migration or leakage, clear protocols must be in place to swiftly identify the source, mitigate the impacts, and assign liability. This could involve empowering independent third-party verification of monitoring data or establishing emergency response plans.
Long-term Liability and Risk Management
One of the most significant regulatory challenges for CCS is the management of long-term liabilities. Once a storage site is closed and responsibility is transferred to the state, governments must be confident that the CO₂ will remain securely contained for centuries to come.
Regulations should establish robust financial mechanisms to ensure adequate resources are available for long-term monitoring, maintenance, and potential remediation efforts. This could involve requiring project developers to set aside funds in escrow accounts or purchase long-term insurance policies.
The EU could also explore innovative risk-sharing models, such as public-private liability-sharing agreements, to encourage private investment in CCS while protecting taxpayers. Careful consideration of how liability is allocated between operators, storage site owners, and governments will be crucial to incentivizing large-scale CCS deployment.
Technological Advancements and the Role of Innovation
While regulatory frameworks are essential, continued technological innovation will also be vital to driving down the costs and improving the performance of CCS systems. The EU can support this innovation through strategic investments in research, development, and demonstration (RD&D) projects.
Ongoing advances in capture technologies, such as amine-based absorption and membrane-based separation, are improving efficiency and reducing the energy penalty associated with CO₂ capture. Innovations in storage and utilization, including enhanced oil recovery and mineralization, are also expanding the options for secure, long-term CO₂ disposal.
The EU’s Innovation Fund, supported by revenues from the Emissions Trading System, has already provided crucial funding for several first-of-a-kind CCS projects. By continuing to target innovation gaps and support the scale-up of promising technologies, the EU can help catalyze cost reductions and performance improvements across the CCS value chain.
Economic Incentives and Financing Mechanisms
Ultimately, the large-scale deployment of CCS will require substantial private investment. To attract this capital, the EU and national governments must develop a comprehensive suite of economic incentives and financing mechanisms.
The EU’s Emissions Trading System (ETS) is a crucial policy tool, as it provides a carbon price signal to reward the avoidance of CO₂ emissions. However, the current ETS price has often been too low and volatile to drive widespread CCS deployment. Complementary mechanisms, such as carbon contracts for difference, can provide more stable revenue streams to CCS project developers.
Public funding will also be essential, particularly for first-of-a-kind projects that face higher risks and costs. The EU’s Innovation Fund and the Connecting Europe Facility have already played a vital role in supporting CCS demonstration projects. As the technology matures, public-private partnerships and innovative financing models, like regulated asset base structures, can help catalyze private investment in shared CCS infrastructure.
Stakeholder Engagement and Public Acceptance
Successful CCS deployment will also hinge on addressing public concerns and building broad stakeholder support. Early CCS projects in Europe have sometimes faced local opposition due to fears about storage site safety and continued reliance on fossil fuels.
To overcome this challenge, governments and industry must engage proactively with communities, environmental NGOs, and other key stakeholders. Transparent communication, independent monitoring, and collaborative decision-making processes can help build trust and address legitimate concerns.
Equally important is the need to ensure a just transition for workers and communities impacted by the shift away from carbon-intensive industries. Regulations and incentive schemes should include provisions for workforce training, economic diversification, and supporting affected regions.
By addressing the complex regulatory, technological, economic, and social dimensions of CCS, Europe can unlock the essential role of this technology in its decarbonization efforts. As the European Future Energy Forum has highlighted, a coordinated, multi-faceted policy approach is crucial to catalyzing large-scale CCS deployment and realizing its full potential to support a net-zero, sustainable future.
