Klima-, Energi- og Forsyningsudvalget 2022-23 (2. samling)
KEF Alm.del Bilag 424
Offentligt
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10 Recommendations for
Scaling Up Carbon Capture
European Union
31 August 2023
Utilisation and Storage in the
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 KEF, Alm.del - 2022-23 (2. samling) - Bilag 424: Henvendelse af 22/9-23 fra European Energy vedr. anbefalinger til at understøtte udviklingen af et marked for CCUS i EU
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10 Recommendations for Scaling Up Carbon Capture Utilisation and Storage in the European Union
Table of contents
Introduction ........................................................................................................................................ 3
Secure CO
2
availability for Utilisation and storage ................................................................... 4
1.
Set EU targets for carbon capture towards 2050
........................................................ 4
2.
Require carbon capture on new installations
.............................................................. 4
3.
Phase-in carbon capture for existing installations
.................................................... 4
Establish an EU-wide CO
2
infrastructure .................................................................................... 5
4.
Analyse infrastructure needs
........................................................................................... 5
5.
Allow multimodal transportation
.................................................................................... 5
6.
Develop a European certification system for CO
2
sources
....................................... 5
Support both CCU and CCS with a Technology neutral approach ....................................... 6
7.
Apply an open competition approach
............................................................................. 6
8.
Grant support across the CCUS value chain
................................................................. 6
Promote utilisation of biogenic and atmospheric CO
2
............................................................. 6
9.
Regulate a prioritised use of biogenic and atmospheric CO
2
................................... 7
10.
Set out an EU definition of biogenic CO
2
...................................................................... 7
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 KEF, Alm.del - 2022-23 (2. samling) - Bilag 424: Henvendelse af 22/9-23 fra European Energy vedr. anbefalinger til at understøtte udviklingen af et marked for CCUS i EU
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10 Recommendations for Scaling Up Carbon Capture Utilisation and Storage in the European Union
Introduction
Another record-breaking hot summer underlines that we need to drastically reduce CO2
emissions in order to meet our global commitments in the Paris Agreement limiting global
temperature increases to 1.5 degrees.
All available technologies must be deployed if the EU is to reach its goal of climate neutrality
by 2050. Carbon capture, utilisation and storage (CCUS) will play a significant role in
achieving this. It is of vital importance that the European Commission works to promote
both utilisation and storage technologies on an equal footing in a new European CCUS
Strategy and in future initiatives and legislation.
It will be essential to store CO
2
permanently underground using carbon capture and storage
technologies (CCS), which can contribute to significant emission reductions. However, CO
2
is also an important feedstock in carbon capture and utilisation (CCU) technologies, which
are crucial for the green transition of a number of hard-to-abate sectors. Thus, it is
necessary to create incentives for CCU for off-takers as well as CO
2
emitters. This will
stimulate demand which CCU operators are ready to fulfil.
As a leading company in Power-to-X, European Energy will contribute significantly to CCU
with the world’s first large-scale
e-methanol plant in Kassø, Denmark. By early 2024, the
plant will produce up to 42.000 tons of e-methanol annually. The e-methanol, derived from
renewable hydrogen and biogenic CO
2
captured from a biogas plant, will serve as a
sustainable fuel for shipping and a raw material for plastic production.
In this position paper, European Energy proposes key policy and regulatory measures for the
European Commission to consider when formulating a strategic vision for CCUS deployment
in the EU. The following 10 recommendations will support the creation of a single market for
CO
2
, which is the fundamental first step for a thriving European CCUS industry. Unlocking
the full climate potential of CCUS requires the establishment of a comprehensive
framework, including targets for carbon capture securing access to CO
2
, the development of
a European CO
2
infrastructure, and support targeting both CCU and CCS.
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 KEF, Alm.del - 2022-23 (2. samling) - Bilag 424: Henvendelse af 22/9-23 fra European Energy vedr. anbefalinger til at understøtte udviklingen af et marked for CCUS i EU
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10 Recommendations for Scaling Up Carbon Capture Utilisation and Storage in the European Union
Secure CO
2
availability for
Utilisation and storage
Both CCU and CCS technologies can only fulfil their full potential if sufficient CO
2
is
available in a single market for CO
2
. European Energy recommends the following measures
that will boost the access to CO
2
across the EU:
1
Set EU targets for carbon capture towards 2050
The European Commission should set EU targets for carbon capture by 2050, including
short-term targets to act as clear milestones towards 2050. In addition, Member States
should be required to include carbon capture targets in their National Energy and Climate
Action Plans (NECPs), along with measures for transport, use, and storage development.
However, carbon capture should be seen as a transitional technology and must not become
an excuse for new fossil fuel investments. Instead, carbon capture should be limited to point
sources necessary for society such as waste-to-energy plants, combined heat and power
plants, and cement production, as well as biogenic sources meeting EU sustainability
requirements.
2
Require carbon capture on new installations
New installations producing or combusting biofuels and biomass as well as installations
providing heating and/or electricity through waste incineration should be required to be
equipped with carbon capture. The entry into force of such a requirement must be based
on an assessment of technology maturity and expectations for the development of an EU-
wide CO
2
infrastructure.
3
Phase-in carbon capture for existing installations
Existing biomass and waste-to-energy installations should also be required to install carbon
capture. However, the requirement should be phased in concurrent with the development
of a European CO
2
infrastructure and technology maturity.
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 KEF, Alm.del - 2022-23 (2. samling) - Bilag 424: Henvendelse af 22/9-23 fra European Energy vedr. anbefalinger til at understøtte udviklingen af et marked for CCUS i EU
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10 Recommendations for Scaling Up Carbon Capture Utilisation and Storage in the European Union
Establish an EU-wide CO
2
infrastructure
Establishing a European CO
2
infrastructure enabling the trade of CO
2
is essential to creating
a competitive and profitable single market for CO
2
. The establishment should go hand in
hand with hydrogen infrastructure and the deployment of renewable energy in order for
CCUS to contribute as much as possible to achieve the European climate goals. As an
example, climate benefits green fuels such as e-methanol depend heavily on the
combination of biogenic CO
2
and hydrogen produced by renewable energy. European Energy
recommends the following measures to support the establishment of an EU-wide CO
2
infrastructure:
4
Analyse infrastructure needs
The European Commission should analyse European infrastructure needs considering key
point sources and possible infrastructure connections across borders. Publishing these
findings will benefit all CCUS actors across Member States.
5
Allow multimodal transportation
To ensure a certain degree of predictability for investments, it is crucial that the regulatory
framework supports multimodal CO
2
transportation. Cross-border and domestic CCUS
projects rely on different modalities for the transport of CO
2
such as pipelines, rail, ships,
and trucks depending on the location of the CO
2
source and the CCUS technology used.
6
Develop a European certification system for CO
2
sources
A certification system is central to a cost-effective deployment of a European CO
2
infrastructure and to ensure the free trade of CO
2
across the continent as well as import
from non-EU countries. Uniform standards for CO
2
in terms of composition, purity and
pressure, as well as standards for the transport value chain will ease connections between
countries. Furthermore, the rules for trading CO
2
removals certificates are of great
importance for the pricing of CO
2
in the current immature market. Hence, it is important for
the establishment of a single market for CO
2
that the current work on the EU carbon removal
certification framework is accelerated, which will create greater clarity for the CCUS
industry.
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 KEF, Alm.del - 2022-23 (2. samling) - Bilag 424: Henvendelse af 22/9-23 fra European Energy vedr. anbefalinger til at understøtte udviklingen af et marked for CCUS i EU
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10 Recommendations for Scaling Up Carbon Capture Utilisation and Storage in the European Union
Support both CCU and CCS with a
Technology neutral approach
Support schemes favouring CCS may distort the market and affect CCU actors
disproportionately. Subsidising storage only will have a particularly severe impact on
availability and the price of biogenic CO
2
to be used in CCU products, ultimately delaying
the green transition of hard-to-abate sectors. Thus, European and national support
schemes for CCUS technology should not favour either CCS or CCU. European Energy
recommends the following measures to support both technologies:
7
Apply an open competition approach
Only the market conditions and the CO
2
price should determine whether CO
2
is stored or
utilised. An open competition approach in support schemes equals the access to biogenic
CO
2
resources in particular, while favouring one technology will lead to an inappropriate
distortion of the CO
2
market. If support schemes only subsidise CCS, prices on biogenic CO
2
will increase resulting in disproportionately high end-user prices on CCU products such as
e-fuels and chemicals that are crucial for decarbonising sectors such as shipping, aviation
and industry.
8
Grant support across the CCUS value chain
Support schemes should target the synergies between CCUS technologies by ensuring a level
playing field for support among actors across the CCUS value chain. When subsidies are not
exclusively targeted CO
2
emitters, the investment risks are spread across the value chain
benefitting the entire CCUS industry.
Promote utilisation of biogenic and
atmospheric CO
2
The climate benefits associated with CCU largely depend on the CO
2
source used and the
carbon intensity of the energy used in processes. In order to gain maximum positive climate
effects, CCU products should substitute similar products on the market made from fossil
feedstock with a more sustainable alternative. However, is expected that biogenic CO
2
will
become a scarce resource in the future for which CCUS players will have to compete,
especially if the political and regulatory focus is directed towards underground storage only.
At the same time, Direct Air Capture technologies are currently at a very early stage of
maturity. Therefore, European Energy recommends the following measures to ensure the
positive contribution of CCU technology to achieving net zero:
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 KEF, Alm.del - 2022-23 (2. samling) - Bilag 424: Henvendelse af 22/9-23 fra European Energy vedr. anbefalinger til at understøtte udviklingen af et marked for CCUS i EU
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10 Recommendations for Scaling Up Carbon Capture Utilisation and Storage in the European Union
9
Regulate a prioritised use of biogenic and atmospheric CO
2
The EU regulation must provide incentives for the use of biogenic and atmospheric CO
2
to
replace fossil CO
2
in sectors that are dependent on carbon feedstock or that cannot be
electrified directly. This applies, for example, to long distance aviation and shipping, where
the use of non-carbon-based fuels is not foreseen in the near future. Therefore, European
Commission should propose higher and binding targets for the uptake of renewable fuels of
non-biological origin (RFNBOs) in future revisions of relevant legislation such as FuelEU
Maritime and ReFuelEU Aviation. This will target CCU towards hard-to-abate sectors and
incentivise a prioritisation of biogenic CO
2
that leads to replacement of fossil CO
2
.
10
Set out an EU definition of biogenic CO
2
The European Commission should set out an EU definition of biogenic CO
2
along with
appropriate sustainability requirements. The recently adopted delegated acts on RFNBOs
regulates that e-fuels such as e-methanol can only be based on sustainable CO
2
sources in
the future. However, what is considered biogenic CO
2
sources in the long run is not clearly
defined. Biogenic CO
2
is expected to become a scarce resource in the future. Therefore, a
clear definition of biogenic CO
2
sources is of great importance for all CCU operators in the
long run. A definition will not only be central for a European certification system to
distinguish the origin of CO
2
sources through documentation. This will also enable the use
of biogenic fractions of mixed CO
2
sources, provided that the biogenic origin can be
documented and the fossil share is stored.
For more information please contact Signe Albers, Regulatory Affairs Manager
[email protected]
T: +45 31 34 76 55
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