COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS Towards an ambitious Industrial Carbon Management for the EU
Date: 2024-02-06
Institutions: Directorate-General for Energy, European Commission
Subjects: EU environmental policy, EU industrial policy, EU strategy, carbon capture and storage, carbon neutrality, circular economy, global warming, greenhouse gas, renewable energy, sustainable development

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   EUROPEAN COMMISSION  Strasbourg, 6.2.2024  COM(2024) 62 final  COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE AND THE COMMITTEE OF THE REGIONS Towards an ambitious Industrial Carbon Management for the EU       
 
 
1.  Why the EU needs an industrial carbon management strategy 

The  European  Union  is  committed  to  achieving  economy-wide  climate  neutrality  by  2050  to 
limit global warming to 1.5 °C. It is implementing a comprehensive policy framework to reduce 
emissions by at least 55% by 2030 and the Commission has now laid out the groundwork for the 
EU’s climate ambition for the next decade1.  

Achieving  these  targets  and  weaning  off  our  reliance  on  fossil  fuels  requires  decisive  climate 
action  across  all  sectors  of  the  economy.  An  EU  industrial  carbon  management  strategy  is  in 
itself  an  essential  complement  to  the  mitigation  of  greenhouse  gas  (GHG)  emissions  that  is 
necessary  in  the  first  place.  As  a  global  frontrunner,  the  EU  has  the  opportunity  to  create  an 
economic  edge  in  industrial  carbon  management  technologies  providing  global  business 
opportunities2.  Industrial  carbon  management  can  help  to  decarbonise  production  processes  in 
industrial  sectors  that  are  important  for  the  European  economy,  complementing  other 
decarbonisation  efforts.  Industrial  carbon  management  is  therefore  a  sound  and  important 
building block for a sustainable and competitive economy in Europe. 

In  2040,  the  consumption  of  fossil  fuels  for  energy  would  reduce  by  approximately  80% 
compared to 2021.3 This reduction will be achieved through rapid development and integration 
of  renewable  energy  sources,  circularity  and  resource  efficiency,  industrial  symbiosis,  energy 
efficiency,  alternative  production  processes  and  material  substitution,  with  the  reuse  of  carbon 
contributing  to  this  major  shift.  In  addition,  it  will  be  driven  by  the  latest  reform  of  the  EU 
Emissions Trading System (ETS), through which industrial emissions will have to decline at an 
accelerated pace to reach the 2030 target and which has introduced the new EU ETS, covering 
CO2  emissions  from  fuel  use  in  road  transport,  buildings  and  additional  sectors4.  But  in  some 
sectors, a limited use of fossil fuels will remain also in 2040, for example in the form of oil in the 
transport sector and some gas for heating and industrial purposes (including as feedstock). This 
Communication  recognises  that  industrial  carbon  management  technologies  are  part  of  the 
solution  towards  achieving  climate  neutrality  by  2050.  These  technologies  are  needed  to 
continue  reducing  and  managing  carbon  emissions  in  industrial  processes  in  the  EU,  notably 
where mitigation options are limited. 

However, additional measures are needed to continue reducing and manage carbon emissions in 
industrial processes in the EU, notably where other mitigation options are limited5. During this 
decade,  the  main  focus  will  be  on  capturing  CO2  from  process  emissions  as  well  as  some 
emissions from fossil and biogenic CO2 sources (see Figure 1). Besides natural carbon sinks and 
carbon  farming6,  reaching  economy-wide  climate  neutrality  by  2050  will  require  industrial 

1  Communication  “Securing  our  future  –  Europe’s  2040  climate  target  and  path  to  climate  neutrality  by  2050 
building a sustainable, just and prosperous society”, COM(2024) 63 (‘EU’s 2040 climate target communication”).  
2 See: Progress on competitiveness of clean energy technologies (COM(2023) 652 final). 
3 Impact Assessment for the EU’s 2040 climate target Communication, SWD(2024) 63. 
4 This will be operational as of 2027; Directive (EU) 2023/959. 
5  IPCC,  2022.  Climate  Change  2022:  Mitigation  of  Climate  Change;  IEA,  2021.  Net  Zero  Roadmap  A  Global 
Pathway to Keep the 1.5 °C Goal in Reach; ESABCC 2023, Scientific advice for the determination of an EU-wide 
2040 climate target and a greenhouse gas budget for 2030–2050 (link). 
6 See Communication on Sustainable Carbon Cycles (COM(2021) 800 final). 

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carbon removals from biogenic and atmospheric sources already before 2040, to counterbalance 
hard-to-abate emissions in the EU and to achieve negative emissions thereafter.  

The EU is relatively well-positioned on CO2-capture technologies and in terms of research and 
innovation, with a number of companies supplying different capture technologies on commercial 
terms7. The geological knowledge and know-how of companies in building pipelines and ships, 
drilling wells will be essential when developing carbon management projects. 

The  EU  already  has  a  number  of  policies  in  place  to  support  the  capture  of  CO2.  However,  to 
reap  its  full  economic  potential  in  line  with  the  ambition  of  the  EU’s  2040  climate  target 
Communication8 and to reach climate neutrality by 2050, the EU will need to significantly scale 
up efforts.  In the Net Zero Industry Act, the Commission has proposed that at least 50 million 
tonnes of CO2 per year can be stored geologically by 2030.  

Modelling results for the EU’s 2040 climate target Communication indicate that approximately 
280 million tonnes would have to be captured by 2040 and around 450 million tonnes by 20509 
(see Figure 1). These results provide the context for further discussions with industry and other 
stakeholders  on  pathways  for  these  technologies.  By  2040,  close  to  half  of  the  CO2  that  is 
captured annually would have to come from biogenic sources or  directly from the atmosphere. 
This  would  play  an  important  role  to  remove  carbon  from  the  atmosphere  and  to  provide  a 
climate-neutral source of carbon for various industrial applications as well as for the production 
of  sustainable  fuels  for  hard-to-abate  emissions  in  transport,  such  as  in  aviation  and  in  the 
maritime sector, where CCS on-board of ships is also an option to explore. 

The scale of this endeavour is large. Storing 50 million tonnes in 2030 is the equivalent of the 
annual CO2 emissions of Sweden in 202210. Industry stakeholders expressed that, by 2030, they 
could  capture  up  to  80  million  tonnes  of  CO2  per  year  in  Europe  if  the  necessary  investment 
conditions are in place11.  

Carbon  capture  will  also  require  significant  additional  energy  to  power  this  energy-intensive 
process12, and, in the case of biogenic carbon, the sustainable sourcing of biomass. Furthermore, 
while CCS and CCS industrial projects should develop and operate on commercial basis, some 
financing  support  providing  bridging  solutions  will  be  needed  especially  at  the  first  stage  of 
creating the European market and infrastructure. 

7 JRC CETO CCS 2023 report: (link). 
8 COM(2024) 63. 
9 SWD(2024) 63.    
10 Total greenhouse gas emissions of Sweden were 49.5 Mt in 2022, based on Eurostat 2023 (link). 
11  Calculated  by  CCUS  Forum  stakeholder  coalition  (industry,  NGOs),  these  projects  have  not  taken  final 
investment  decisions  due  to  among  other  factors  a  lack  of  CO2  value  chain  services  (transport,  storage)  and 
insufficient financial support, see CCUS Vision Working Group, April 2023 (link). 
12  Typically,  carbon  capture  processes  consume  1-3  MWh/tonne  of  CO2.  Data  based  on  IEA  (2022)  Direct  Air 
Capture and IEA (2023) The Oil and Gas Industry in Net Zero Transitions. 

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Figure 1: Volume of CO2 captured for storage and utilisation in the EU (above chart) and share 
of the CO2 captured by origin (below chart)13 

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Carbon Capture and 
Utilisation 

Carbon Capture and 
Storage 

Direct Air Capture 
Biogenic Emissions 
Process Emissions 
Fossil Fuel Emissions 

The scale of this challenge requires an EU-wide  industrial carbon management strategy, which 
will be based on three pathways:  

•  Capturing CO2 for storage (CCS): where CO2 emissions of fossil, biogenic or atmospheric 

origin are captured and transported for permanent and safe geological storage. 

•  Removing  CO2  from  the  atmosphere:  where  permanent  storage  involves  biogenic  or 

atmospheric CO2 and it will result in removing carbon from the atmosphere. 

•  Capturing  CO2  for  utilisation  (CCU):  where  industry  uses  captured  CO2  in  synthetic 
products, chemicals or fuels. Whilst initially using all types of CO2, over time a strategic 
focus  of  utilisation  value  chains  on  capturing  biogenic  or  atmospheric  CO2  will  yield 
higher climate benefits. 

CO2 transport infrastructure is the key enabler common to all pathways. Where the captured CO2 
is not used directly on-site, it will need to be transported and either used in industrial processes 
(e.g. for construction products, synthetic fuels, plastics or other chemicals) or permanently stored 
in geological formations. 

13 The numbers included in this figure are based on the modelling of the impact assessment for EU’s 2040 climate 
target Communication (SWD(2024) 63). The volumes of CO2 captured, stored and utilised and the shares by origin 
of CO2 are scenario dependent, values  representing the average of  scenarios S2 and S3 are reported in this figure. 
The small increase in the share of captured fossil CO2 for 2040 reflects a broader deployment of CO2 capture power 
installations  in  a  context  where  the  overall  use  of  fossil  fuel  in  power  installation  is  significantly  lower  towards 
2050. 

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The  aim  of  this  strategy,  therefore,  is  to  bring  together  different  policy  strands  to  create  an 
enabling  environment  to  develop  and  scale  up  industrial  carbon  management  approaches.  It 
describes  the  current  state  of  play  for  industrial  carbon  management,  the  envisioned  pathway 
towards  2050,  the  policy  framework  for  industrial  carbon  management,  and  the  necessary  pre-
conditions to support industrial carbon management approaches. 

2.  The state of play on industrial carbon management in Europe 

The EU already has a number of policies that are supporting carbon capture and storage and/or 
utilisation,  and  the  associated  infrastructure  needs.  Since  2009,  geological  storage  of  CO2  is 
regulated  by  the  CCS  Directive,  which  sets  permitting  rules  to  ensure  the  safety  and 
environmental integrity of CO2 storage and prescribes transparent and non-discriminatory access 
to the infrastructure14. Furthermore, CO2 transport projects are supported under the revised TEN-
E Regulation15 and the current list of 14 projects of common interest (PCIs) or projects of mutual 
interest (PMIs)16 add up to an overall planned capacity up to 103 million tonnes per year of CO2 
through four onshore storage sites and eight or more offshore locations.  

The EU Emissions Trading System (ETS)17 has put a price on CO2 emissions and, since 2013, 
has incentivised the capture of CO2 for permanent storage in the EU and the European Economic 
Area  (EEA).  Recently,  the  EU  ETS  reform  brought  in  several  changes  to  support  industrial 
carbon management, including a broadened scope of CO2 transport for storage and incentives for 
the  uptake  of  synthetic  fuels  in  the  aviation  sector.  Furthermore,  allowances  for  emissions 
considered  to  have  been  permanently  captured  and  utilised  do  not  need  to  be  surrendered18, 
providing more options for emitters to capture CO2. The EU Innovation Fund, established with 
revenue generated by the EU ETS,  already supports carbon  capture and  storage  projects  in  the 
order of approximately 10 million tonnes of CO2 per year becoming operational as early as 2027. 

In  2021,  the  Commission  set  out  aspirational  2030  objectives  to  reach  a  share  of  at  least  20% 
sustainable carbon in  the carbon used as feedstock in  the EU chemical  industry and to  remove 
19.  An  EU  certification  framework  for 
and  permanently  store  at  least  5  million  tonnes  of  CO2
carbon  removals20,  soon  to  be  adopted  by  the  co-legislators,  is  expected  to  ensure  the 
environmental integrity of certified carbon removals. 

14 See Article 21 Access to transport and storage infrastructure of Directive 2009/31/EC. 
15 Regulation (EU) 2022/869. 
16 Projects of Common Interest (PCIs) are key-cross border infrastructure projects that link the  energy systems of 
EU countries (link). 
17 Directive 2003/87/EC. 
18 This includes the CO2 used for the production and use of renewable fuels of non-biological origin. 
19 COM(2021) 800. 
20 COM(2022) 672 final. 

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Furthermore,  the  proposed  Net  Zero  Industry  Act  (NZIA)21  recognises  carbon  capture  and 
storage  as  strategic  net-zero  technologies  and  supports  project  deployment  with  regulatory 
measures,  including  accelerated  permitting  procedures.  The  proposal  also  includes  a  target  for 
the  EU  to  have  available  capacity  to  annually  store  50  million  tonnes  of  CO2  by  2030  and 
mandates oil and gas producers to invest in those initial infrastructures, recognising the sector’s 
specific know-how in this field. 

Based on these policies, 20 Member States have already included industrial carbon management 
solutions in their draft national energy and climate plans (NECPs).22 In their draft plans, Member 
States  project  that  annually  a  volume  of  up  to  34.1  million  tonnes  of  CO2  will  be  captured  in 
2030,  of  which  5.1  million  tonnes  from  biogenic  sources23.  This  compares  with  an  overall 
injection  capacity  estimated  by  Member  States  of  39.3  million  tonnes  per  year  in  203024. 
According  to  the  submitted  draft  NECPs,  CO2  would  be  captured  mainly  from  process 
emissions, especially in the cement, steel and natural gas processing sectors. Member States also 
prioritise  carbon  capture  in  the  production  of  electricity,  especially  from  biomass,  and  in  the 
production  of  low-carbon  hydrogen.  Other  applications  for  carbon  capture  reflected  in  the 
NECPs are in the refining sector, waste incineration and thermal heat production. 

Seven  Member  States  have  also  included  these  technologies  in  their  recovery  and  resilience 
plans.  Denmark  and  the  Netherlands  already  have  functioning  national  subsidy  schemes  for 
carbon  capture  and  have  accelerated  action  to  make  CO2  storage  available.  Together  with 
Norway  and  Iceland,  these  four  countries  are  pioneering  the  geological  storage  of  CO2  on  an 
industrial  scale  and  are  seeing  increasing  commercial  interest  in  both  onshore  and  offshore 
storage  licenses.  France,  Germany  and  Austria  are  currently  developing  carbon  management 
strategies. 

To support carbon capture and use, a stakeholder dialogue platform, the CCUS Forum25, was set 
up in 2021. Working groups under the CCUS Forum focused on key issues in connection with 
the development of the carbon management market: infrastructure (including an expert group on 
CO2 specifications/standards), public perception and industrial  partnerships26. The Commission 
intends  to  continue  drawing  on  this  platform  in  the  future  work  on  industrial  carbon 
management.  

21 Proposal for a regulation of the European Parliament and of the Council on establishing a framework of measures 
for  strengthening  Europe’s  net-zero  technology  products  manufacturing  ecosystem  (Net  Zero  Industry  Act), 
COM(2023) 161. 
22 Member States have different priorities, Germany, Hungary, Lithuania, Portugal (CCS & CCU), Cyprus, Czechia, 
Denmark, Estonia, Greece, Spain, France, Croatia, Italy, Netherlands, Romania, Sweden, Slovenia, Slovakia (CCS), 
Finland, Luxembourg (CCU). 
23  Based  on  the  draft  National  Energy  and  Climate  Plans  (NECP)  submitted  by  30  June  2023  (COM(2023)  796 
final),  Belgium,  Czechia,  Denmark,  France,  Greece,  Italy,  Lithuania  and  Netherlands  project  annually  capture  of 
CO2 from as early as 2025, in total Member States project to capture  34.1 Mt CO2 annually by 2030, of which 5.1 
Mt CO2 from biogenic sources. 
24 In their draft NECPs, only Denmark, Italy and Netherlands have estimated annual CO2 injection capacity available 
in  2030,  additional  Member States  are  currently undergoing  or  planning  to  conduct  assessments  of  their  potential 
geological capacity. 
25 Link. 
26 Link. 

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Despite  the  policies  supporting  industrial  carbon  management  and  the  projects  planned, 
operational large-scale projects are limited in Europe. Furthermore, today’s experience reveals a 
number of challenges, notably; 

-  difficulties  in  building  a  viable  business  case,  including  because  of  significant  up-front 
investment  capital  required,  uncertainty  of  future  CO2  prices  and  the  need  for  extra 
attention for matching supply and demand for low-carbon products, 
the lack of a comprehensive regulatory framework across the entire value chain, notably 
for industrial carbon removals and for certain CO2 uses.  

- 

-  The  first  businesses  involved  in  building  carbon  value  chains  also  face  CO2-specific 
cross-value chain risks, such as liability for leakages or the unavailability of transport or 
storage infrastructure.  
Insufficient coordination and planning, especially in cross-border contexts. 
Insufficient  incentives  for  private  and  public  investment  to  proof  the  business  case  for 
industrial carbon management. 

- 
- 

In  general,  governments  across  the  EU  still  need  to  recognise  carbon  capture  and  storage  as  a 
legitimate and necessary part of the solution to decarbonise.  

This strategy addresses each of these challenges, based on the steps already undertaken and the 
political and economic case for a more ambitious industrial carbon management in Europe. 

3.  A vision for the European approach to industrial carbon management  

A  common  approach  and  vision  are  needed  to  establish  a  single  market  for  industrial  carbon 
management  solutions  as  a  key  building  block  to  achieve  climate-neutrality  in  2050.  This 
includes an enabling business and investment framework, boosted with more ambitious and well-
coordinated  policies  at  national  level,  as  well  as  strategic  infrastructure  planning  at  EU  level, 
underpinned  by  close  cooperation  between  the  EU  and  national  administrations  and  also 
businesses, civil society and research communities. 

To achieve this, Europe will have to deploy large-scale carbon value chains in Europe to support 
the different stages of industrial carbon management.  

The EU’s strategic objective for 2030 is the deployment of CO2 storage capacity of at least 50 
million  tonnes  per  year27  together  with  related  transport  modes  consisting  of  pipelines,  ships, 
trains and trucks, depending on each business case. 

The 2030 targets for the uptake of renewable hydrogen in industry and transport will incentivise 
the use of CO2 for the production of methanol and e-fuels. The first CO2 infrastructure hubs and 
industrial clusters are expected to emerge in Europe, serving CO2 capture projects supported by 
national  and  EU  funding  programmes,  for  which  many  rely  on  cross-border  CO2  transport.  In 
this  early  phase  of  CO2  transport  development,  the  majority  of  CO2  transport  will  take  place 

27 COM(2023) 161 final. 

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through alternative forms of transportation to the coast, followed by shipping to offshore storage 
locations. Alongside these CO2 infrastructure hubs, the first commercial off-take agreements for 
CO2  capture  and  storage  are  being  signed,  especially  for  the  industrial  facilities  where  carbon 
capture  costs  are  relatively  low.  Investments  in  these  hubs  will  be  facilitated  by  new  EU-wide 
CO2 transport infrastructure interoperability rules, including minimum CO2 quality standards to 
ensure it can flow freely across the EEA. 

By  2040,  most    carbon  value  chains  should  become  economically  viable  to  meet  EU  climate 
objectives  based  on  CO2  as  a  tradable  commodity  for  storage  or  use  within  the  EU’s  single 
market. Up to  a third of the captured CO2 could be used. These  value chains  would  need  EU-
wide  transport  and  storage  infrastructure  with  pipelines  being  the  main  means  of  transport,  as 
well as shipping options. Infrastructure enables the cross-border transport of captured CO2 either 
for  storage  or  for  use,  based  on  a  regulatory  environment  that  guarantees  non-discriminatory 
access to competitive services of transport and storage. Capturing  hard-to-abate CO2 emissions 
in  industrial  sectors  would  become  the  norm,  including  all  relevant  remaining  sources  of 
industrial  process  emissions.  To  meet  the  2040  net  GHG  emission  reduction  objective,  the 
capture levels of biogenic and atmospheric CO2 should already be comparable to the capture of 
fossil CO2 by 2040, and eventually exceed those levels (see Figure 1). 

After  2040,  industrial  carbon  management  should  be  an  integral  part  of  the  EU’s  economic 
system,  and  biogenic  or  atmospheric  carbon  should  become  the  main  source  for  carbon-based 
industrial  processes  or  transport  fuels.  Any  remaining  fossil-based  CO2  would  need  to  be 
captured, and a strong business case for negative emissions would be in place.  

Achieving  this  vision  of  a  well-functioning  and  competitive  market  for  captured  CO2  requires 
partnership  with  industry  and  Member  States,  and  ressources  to  develop  a  coherent  policy 
framework  that  provides  regulatory  certainty  and  incentives  for  investments  in  carbon  capture, 
storage,  use  and  carbon  removals.  They  are  technologies  indispensable  to  achieve  climate 
neutrality  and  to  underpin  efficient  infrastructure  investments  in  transport  and  storage 
infrastructure. 

4.  Envisaging a policy framework to deploy industrial carbon management solutions 

The capture of CO2 emissions is the common starting point for all industrial carbon management 
pathways: carbon capture and storage (CCS), carbon removals and carbon capture and utilisation 
(CCU).  In  addition,  CO2  transport  infrastructure  is  needed,  on  top  of  local  use  and  storage  of 
CO2, to enable the establishment of the different pathways and to create a single market for CO2 
in Europe. 

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Figure 2: Description of the CO2 value chains  

Sources 

Capture 

Transport 

Utilisation 
Input or feedstock products 

Process 
emissions 

Fossil fuel 

Biogenic 

Industrial 
facility 

Energy 
production facility 

Pipelines 

Ships 

Fuels  Construction  Plastics  Other 

Air 

Direct air 
capture 

Trucks 

Trains 

Onshor
e 

Offshore 

Permanent storage 
Underground geological formations 

4.1 

Deploying transport infrastructure for a single market for CO2  

Transport  of  CO2  is  already  a  commercial  activity,  however,  the  volumes  moved  by  various 
modes  of  transport  and  local  networks  are  very  small  compared  with  the  future  needs  of 
industrial carbon management.  

Emitters capturing CO2, utilisation companies and storage site operators should be able to rely on 
a  functioning  cross-border,  open-access  CO2  transport  network  as  such  networks  are  currently 
not regulated at EU level. All CO2 transport modes are covered by the EU ETS, but accounting 
and liability rules need to be developed for emissions from all modes within this framework. 

To  build  a  market  catering  for  the  needs  of  developing  CCS,  CCU  and  industrial  carbon 
removals,  significant  investments  will  be  needed.  A  Commission  study  estimates  that  CO2 
transport  network,  including  pipelines  and  shipping  routes,  could  span  up  to  7300  km  and 
deployment could cost up to EUR 12.2 billion in total by 2030, rising to around 19 000 km and 
EUR  16  billion  in  total  by  204028.  Several  challenges  need  to  be  overcome  to  mobilise 
investment and deploy such an extensive transport network. 

While  pipelines  are  in  many  cases  the  most  common  transport  option  for  CO2,  initial  capital 
costs of building them are high and with long lead times. Before 2030, shipping of CO2 will be 
an important option, but this requires the availability of a fleet of specialised CO2 transport ships. 
Uncertainty  regarding  future  CO2  volumes,  complicated  coordination  across  the  value  chains, 
and long  permitting  procedures constitute significant  barriers for investors to  move ahead with 
the  projects.  In  addition,  large-scale  cross-border  transport  infrastructure  will  require  handling 

28 The medium estimates provided here, for the purpose of this strategy,  are based on the 2040  modelling figures. 
For the overall JRC study, estimates also include Fit-for-55 modelling, and could therefore be different. Tumara, D., 
Uihlein, A. and Hidalgo González, I. Shaping the future CO2 transport network for Europe, European Commission, 
Petten, 2024, JRC136709. 

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CO2  streams  from  different  sources,  captured  with  different  technologies  and  using  different 
transport means and different storage sites, which calls for ensuring interoperability.  

Going  forward,  minimum  CO2  stream  quality  standards  will  be  needed  to  avoid  market 
fragmentation29.  The  standardisation  work  should  address  issues  such  as  composition,  purity, 
pressure  and  temperature.  In  addition,  common  guidelines  are  needed  regarding  ‘incidental 
associated substances from the source, capture or injection process’ that can be accepted in CO2 
storage  permits30.  This  would  support  a  fair  market  by  creating  a  balance  between  cost 
effectiveness and risks, as different CO2 purity levels come with different costs, while preventing 
significant risk to the environment. 

Carbon  capture  installations  located  away  from  industrial  hubs  and  storage  sites  and  smaller 
emitters lacking sufficient CO2 volumes to interest transport operators risk being excluded from 
the  market  altogether,  which  could  significantly  undermine  decarbonisation.  Specific  solutions 
are  needed  to  meet  the  needs  of  such  sites  and  of  vulnerable  regions  and  increase  their 
negotiating power with network operators and to ensure a just transition leaving no one behind. 

Transport  infrastructure  is  required  to  create  a  single  market  for  CO2  in  Europe.  Developing  a 
non-discriminatory,  open-access,  transparent,  multimodal,  cross-border  CO2  transport  and 
storage  infrastructure  requires  coordination  across  the  value  chain,  contract  and  price 
transparency and timely permitting.  

Given the potential size of this market as evidenced in the analytical work31, a dedicated policy 
and  regulatory  framework  will  be  necessary  to  optimise  its  development  and  ensure 
harmonisation across Europe, in line with EU competition rules.  

To optimise the benefits of capital spent on infrastructure, a future framework would also need to 
look at interactions with the electricity, gas and hydrogen sectors and the need for future spare 
capacity, including the mapping of the potential repurposing and re-use of existing infrastructure 
for CO2 streams. The aim is to ensure system integration and to promote flexibility and resilience 
in  the  EU  energy  system.  Such  network  planning  across  the  EU  should  be  based  on  a 
participatory  approach,  as  taken  in  the  electricity  and  gas  sectors,  where  stakeholders  provide 
input through consultation processes. To support early CO2 (cross-border) infrastructure projects, 
the  Commission  will  consider,  in  close  engagement  with  industry,  nominating  European 
coordinators  to  address  issues  such  as  particular  difficulties  or  delays  and  to  inform  the 
development  of  fit  for  purpose  regulatory  framework.  The  CCUS  Forum  will  provide  input  to 
this work with the JRC underpinning the process with its work on pan-European CO2 transport 
infrastructure development32.  

The Commission foresees to: 

29 An interoperable CO2 transport network – towards specifications for the transport of impure CO2 (link). 
30 In line with Article 12(2) of Directive 2009/31/EC. 
31 ENTEC study - EU regulation for the development of the market for CO2 transport and storage (link). 
32 Tumara, D., Uihlein, A. and Hidalgo González, I. Shaping the future CO2 transport network for Europe, European 
Commission, Petten, 2024, JRC136709. 

9 

 
 
 
• 

• 

from  2024,  initiate  preparatory  work  in  view  of  a  proposal  for  a  possible  future  CO2 
transport  regulatory  package;  it  will  consider  issues  including  market  and  cost 
structure,  cross-border 
technical  harmonisation  and 
investment  incentives  for  new  infrastructure,  third-party  access,  competent  regulatory 
authorities, tariff regulation and ownership models. 

integration  and  planning, 

from 2024, work towards proposing an EU-wide CO2 transport infrastructure planning 
mechanism  in  cooperation  with  Member  States  and  the  CCUS  Forum  stakeholder 
platform.  The  work  related  to  network  planning  will  also  assess  to  what  extent  it  is 
possible to reuse/repurpose existing infrastructure for CO2 transport and storage, when 
considering  the  priority  for  infrastructure  needs  of  renewable  gases,  and  if  so,  what 
regulatory changes are needed. 

• 

from  2024,  consider,  in  close  engagement  with  industry,  nominating  European 
coordinators to support the early development of (cross-border) infrastructure projects.  

•  develop emissions accounting rules in the context of the EU ETS to enable all means of 

transport of CO2, and ensure liability for leakage. 

•  work with the European standardisation bodies to establish minimum standards for CO2 
streams to  be used in  a  network code, applicable to  all  industrial carbon  management 
solutions, and in addition in cooperation with Member States to consider guidelines on 
‘incidental  associated  substances”  to  ensure  the  integrity  of  the  infrastructure  and 
reservoirs.  

•  promote  through  the  International  Maritime  Organization  the  development  of  any 

necessary guidelines on safe transportation of CO2 by sea. 

4.2 

Capturing and storing CO2 emissions instead of releasing to the atmosphere 

Carbon capture and storage includes applications where CO2 is captured and permanently stored. 
According to the Impact Assessment underlying the EU’s 2040 Climate Target Communication, 
CCS must be deployed at large scale to complement other mitigation actions to address hard to 
abate emissions, in particular industrial process  emissions, and to achieve climate neutrality by 
2050.  

As for most other industrial carbon management pathways, it starts with capturing hard-to-abate 
industrial  CO2  emissions  instead  of  releasing  them  to  the  atmosphere.  The  ETS  carbon  price 
provides an incentive to capture CO2 generated from fossil fuel and industrial process emissions. 
This  incentive  is  expected  to  grow  as  a  result  of  the  last  reform,  as  the  ETS  emissions  cap  is 
steadily decreasing further, setting a strong price expectation for carbon in the EU.  

Today industrial companies throughout the EU are reviewing strategic options to transform their 
production processes into net-zero emission operations in order to lower costs and offer low- or 
zero-carbon end products to the market. Industrial sectors whose process emissions are hard-to-

10 

 
 
 
abate (e.g. cement) are increasingly developing investment plans to capture CO2 either for reuse 
to produce fuels/chemicals (CCU) or to permanently store it (CCS)33.   

Investment  decisions  depend  on  the  development  of  markets  for  low-  or  zero-carbon  end 
products  and  the  availability  of  a  full  CO2  value  chain  with  capture,  transport,  utilisation  or 
storage services offered at competitive prices.  

The Commission will work towards establishing by 2026 an EU CO2 aggregation platform that 
supports  companies  capturing  CO2  to  procure  CO2  value  chain  services.  The  objective  is  to 
facilitate matching storage demand and storage availability in terms of time and locations, while 
contributing to security of storage supply in terms of volume and affordability34. This platform 
could  also  provide  contracting  and  procurement  transparency  and  give  transport  and  storage 
providers  information  on  infrastructure  planning.  This  is  particularly  relevant  for  capturing 
companies with less bargaining power. 

Carbon capture and storage requires not only capturing the CO2 but also storing it permanently. 
Developing  storage  sites  to  meet  the  2030  target  for  injection  capacity  will  need  support  from 
and  dialogue  with  permitting  authorities.  The  application  processes  for  storage  permits  are 
ongoing in only four Member States,35 but eight Member States project that in total 15.2 million 
tonnes CO2 annually will be captured starting as early as 2025, which underlines the urgent need 
to open operational CO2 storage capacity before 203036.  

This  underlines  the  importance  of  early  engagement  between  permit  applicants  and  competent 
authorities during the preparatory phase of strategic net-zero CO2 storage projects and highlights 
the need for further economic incentives to identify and build more storage capacity. It will also 
be important that all Member States complete their analysis of capture needs and storage options 
in the final National Energy and Climate Plans in line with the Commission recommendations.37 

The  business  case  for  developing  critical  CO2  storage  infrastructure  extends  beyond  the 
immediate goal to reduce emissions over the next decades as it has the potential to contribute to 
economy-wide  negative  emissions  even  after  2050.  As  a  first  step,  Member  States  should 
recognise  and  support  storage  sites  and  related  capture  and  transport  infrastructure  as  net-zero 
strategic  projects  under  the  NZIA  to  ensure  sufficient  access  to  injection  capacity  for  hard-to-

33 This includes companies that have applied to the Innovation Fund, which in total have plans to capture more than 
20 million tonnes of CO2 by 2030.  
34 In comparison to AggregateEU for LNG and gas, which relies on existing gas market infrastructures (e.g. virtual 
trading points or LNG terminals), the CO2 platform will have to address longer timelines, as the deployment of new 
CO2 infrastructures and capture installations takes time, but also relies on contractual certainty.  
35 The latest Implementation Report of the CCS Directive (COM(2023) 657 final) shows that as of April 2023 two 
thirds of Member States allow CO2 storage on their territories, and half of them have engaged in discussions about 
cross-border cooperation in view of ensuring CO2 flows to the planned storage sites in the EEA. 
36  Based  on  the  draft  National  Energy  and  Climate  Plans  (COM(2023)  796  final),  Belgium,  Czechia,  Denmark, 
France,  Greece,  Italy,  Lithuania  and  Netherlands  project  annually  capture  of  CO2  from as  early  as 2025,  while  in 
total Member States project to capture 34.1 Mt CO2 annually by 2030, of which 5.1 Mt CO2 from biogenic sources.  
37 For more information see section “2.5 Integrating long-term geological storage of CO2” in the Commission Notice 
on  the  Guidance  to  Member  States  for  the  update  of  the  2021-2030  national  energy  and  climate  plans  (2022/C 
495/02). 

11 

 
 
 
abate CO2 emissions. This would incentivise industrial carbon management value chain clusters 
aimed at pooling initial capture volumes to de-risk storage site investments.  

To  lower  the  upfront  costs  for  storage  investors,  Member  States  can  consider  aggregating 
financial security required from CO2 storage operators in the form of levies per volume of CO2 
stored,  taking  account  of  the  low-risk  degree  CO2  storage  in  comparison  with,  for  instance, 
hydrocarbon production operations38. 

Detailed CO2 emission reduction roadmaps should be co-designed and implemented at sectoral 
level,  taking  into  account  the  complexity  of  industrial  processes.  The  knowledge-sharing 
platform for industrial CCUS projects is the appropriate platform for sectoral roadmaps if the use 
of industrial carbon management is involved. 

Based on the modelling of the impact assessment for the 2040 climate target, an increase in the 
annual  CO2  injection  capacity  for  geological  storage  to  at  least  250  million  tonnes  of  CO2  per 
year  in  2040  in  the  European  Economic  Area  would  be  needed39.  To  do  this,  the  EU  needs to 
identify  and  develop  its  potential  CO2  storage  capacity  and  to  ensure  that  CO2  transport  and 
storage infrastructure capacities are scaled to  meet  the growing  needs of industrial  capture and 
storage post 2030.  

The Commission will therefore kickstart work to create an EU-wide investment atlas of potential 
CO2 storage sites. Following a stocktake of data needs and human and fiancial resources already 
available, the Commission will compile a digital inventory of the underground storage of CO2, 
building  on  the  work  of  European  geological  surveys.40  Each  potential  storage  site  will  be 
labelled according to its ‘storage readiness level’ and matched with public data to speed up the 
work to identify and assess the storage capacities.41  

Geological  services  in  the  EEA  should  be  resourced  and  able  to  aggregate  all  existing  subsoil 
knowledge.  Where  available,  this  should  include  technical  information  such  as  well  samples, 
geophysical  behaviour,  seismic  data  from  hydrocarbon  production  sites  and  early  CO2  storage 
sites. Investors should be able to use this atlas to identify potential storage opportunities as part 
of CO2 value chains.  

In  addition,  CO2  storage  permitting  procedures  need  to  be  well-defined,  made  transparent  and 
comparable  across  the  EU.  The  Commission  will  support  Member  States  in  rolling  out 
recognised  net-zero  strategic  projects  for  industrial  carbon  management,  including  in  tackling 
CO2-specific cross-value-chain liability risks for operators.  

38 In line with Article 19 of Directive 2009/31/EC Member States can decide relevant arrangements. 
39  Modelling  results  from  Impact  Assessment  underlying  the  EU’s  2040  Climate  Target  Communication 
(SWD(2024) 63) show that the EU needs to capture 200 million tonnes of CO2 annually for storage by 2040 with the 
need  for  a  higher  annual  CO2  injection  capacity  to  take  account  of  normal  maintenance  downtimes.  This  annual 
injection capacity requires an aggregated geological storage capacity of several giga-tonnes of CO2 in the EEA.  
40 For example, the European CO2 Storage Atlas developed in 2013 by the CO2 Storage Potential in Europe Project 
(CO2StoP  project)  and  hosted  by  the  JRC  (link)  presents  a  good  basis,  but  also  shows  that  data  gaps  need  to  be 
closed.  
41 Which could be made available through the Commission's Energy and Industry Geography Lab, (link). 

12 

 
 
 
On the basis of the strategic sites that will provide the first 50 million tonnes of annual storage 
capacity by 2030, the Commission will develop guidelines for CO2 storage permitting, balancing 
site-specific  flexibility  with  investment  predictability  to  facilitate  and  speed  up  the  roll  out  of 
CO2 storage. 

The Commission foresees to: 

•  develop,  with  Member  States,  by  early  2026  at  the  latest,  a  platform  for  demand 
assessment and demand aggregation for CO2 transport or storage services, with the aim 
of matching CO2 suppliers with storage and transport providers and providing contract 
and procurement transparency  

•  aim  to  create  and  make  available  by  early  2026,  in  cooperation  with  the  geological 
services  of  the  EEA,  an  investment  atlas  of  potential  CO2  storage  sites  based  on  a 
common storage readiness level format. 

•  use  the  knowledge-sharing  Platform  for  industrial  CCUS  projects  to  develop  together 

with industry sectoral roadmaps for industrial carbon management.  

•  develop, with Member States, by 2025 step-by-step guidance for permitting processes for 

net-zero strategic projects for CO2 storage, notably regarding: 

o 

o 

the  transfer  of  responsibility  from  operators  back  to  the  competent  authorities 
and the corresponding financial security and financial mechanism requirements;  
transparency  on  the  permitting  requirements  and  risk-based  approaches  to 
facilitate final investment decisions by storage operators. 

Member States should: 

• 

include in their updated National Energy and Climate Plans their assessment of capture 
needs and storage capacity/options and identify actions to  support the deployment of a 
CCS value chain. 

•  by  2025,  ensure  that  they  have  transparent  processes  in  place  for  storage  permit 

applicants to engage with the competent authorities during the preparatory phase. 

• 

from  2024  onwards,  support  the  development  and  roll  out  of  cooperative  net-zero 
strategic  projects  under  the  NZIA  to  create  full  carbon  capture,  transport  and  storage 
value chains, including across borders. 

•  by 2025 at the latest, enable their geological services to contribute existing data and to 
generate  new  data  to  contribute  to  an  EEA-wide  investment  atlas  of  potential  CO2 
storage sites.  

13 

 
 
 
4.3 

Removing CO2 from the atmosphere 

Industrial  carbon  removals  value  chains  are  key  to  achieving  the  carbon  neutrality  objective 
enshrined in the European Climate Law.42 To reach net-zero economy-wide GHG emissions by 
2050,  the  EU  could  need  carbon  removals  to  balance  out  around  400  million  tonnes  CO2 
equivalent of residual emissions in hard-to-abate sectors such as agriculture, aviation and some 
industries.43 Nature-based  carbon  removal  solutions  will play an essential role in  this,  but  they 
will not be sufficient. Industrial carbon removals will also be needed to achieve this goal. 

Industrial carbon removals based on CCS technology capture CO2 directly from the atmosphere 
(DACCS) or capture biogenic CO2 from power plants or industrial processes (BioCCS) and store 
it  permanently  contrary  to  non-permanent  removal  solutions  such  as  reforestation,  soil  carbon 
sequestration,  or  bio-based  building  material.  However,  industrial  carbon  removals  face  high 
costs  and  entail  large  energy  requirements  (DACCS)  or  strong  needs  for  natural  resources 
(BioCCS)  that  can  raise  concerns  around  sustainability  if  not  properly  addressed.  The 
deployment  of  both  permanent  and  non-permanent  carbon  removals  requires  incentives  that 
consider their specific characteristics.  

Industrial  carbon  removals  are  not  currently  covered  by  the  EU  ETS  Directive  nor  the  Effort 
Sharing44  or  the  Land,  Land  Use  Change  and  Forestry  (LULUCF)45  regulations.  Since  the  EU 
ETS  does  not  recognise  negative  emissions,  capture  and  storage  of  biogenic  and  atmospheric 
CO2  is  not  incentivised  by  the  EU  compliance  carbon  market  price,  and  currently  the  only 
incentive at EU level comes from the Innovation Fund. In this context, investment decisions for 
this type of operations mainly rely on state subsidies or voluntary carbon markets. The voluntary 
EU  carbon  removal  certification  framework,  accounting  for  life  cycle  emissions  of  carbon 
removals  activities,  will  help  mobilise  financing  while  ensuring  the  environmental  integrity  of 
carbon removals but it is important that the Commission assesses how best to provide incentives 
for industrial carbon removals in existing EU legislation or through new instruments. 

As carbon removals will be instrumental in achieving the 2040 objective and climate neutrality 
by 2050, setting specific objectives for carbon removals could be considered, if necessary, in line 
with the overall EU net GHG emission reduction objective for 2040. 

The Commission has already been mandated by the co-legislators to assess by 2026 if and how 
the CO2 removed from the atmosphere and safely and permanently stored could be accounted for 
and  covered  by  emissions  trading46.  This  must  be  achieved  without  offsetting  emission 
reductions  and  while  ensuring  environmental  integrity,  especially  regarding  the  use  of 
sustainably sourced biomass for BioCCS. 

This  could  be  done  either  by  integrating  industrial  carbon  removals  in  the  EU  ETS  (a  single 
market  where  the  generation  of  industrial  removals  to  comply  with  surrender  obligations  is 

42 Regulation (EU) 2021/1119. 
43 Impact Assessment underlying the EU’s 2040 Climate Target Communication (SWD(2024) 63). 
44 Regulation (EU) 2023/857. 
45 Regulation (EU) 2018/841. 
46 See Article 30 of Directive 2003/87/EC.  

14 

 
 
 
allowed with or without restrictions) or by creating a separate compliance mechanism for  such 
removals,  connected  directly or indirectly to  the  EU ETS.  As a result, this would create price-
based incentives for the generation of industrial carbon removals.  

Initially,  one  of  the  main  challenges  would  be  to  overcome  the  significant  current  difference 
between the prevailing carbon price and the cost of removing CO2 through industrial solutions. 
Although the cost for some BioCCS installations may not be much higher than for capture and 
permanent storage of fossil fuel and process CO2 emissions47, for other types of removals, such 
as direct air carbon capture and storage, the estimated future costs range from EUR 122 to EUR 
48,  well  above  the  current  ETS  price.  Integration  in  the  EU  ETS  pricing 
539  per  tonne  of  CO2
system alone might thus be an insufficient incentive for industrial removals. At an early stage of 
deployment, additional support will be required to accelerate technological learning and reduce 
costs further. In this context, it would also be important to look at the role of the Member States 
in developing industrial carbon removals. 

At the same time, it will be important to accelerate research, development and demonstration to 
advance  new  carbon  removal  technologies  and  lower  their  costs.  Since  different  removal 
technologies are at different stages of maturity, tailored programmes will be needed to guide the 
development.  The  Commission  will  use  its  existing  instruments  to  support  industrial  carbon 
removal  technologies.  Specifically,  the  Horizon  Europe  programme  will  focus  on  stepping  up 
research  to  improve  the  efficiency  and  feasibility  of  removal  technologies,  notably  direct  air 
capture  technologies,  as  well  as  their  commercialisation  and  scale-up  to  market  with  support 
from  the  European  Innovation  Council.  The  Innovation  Fund  will  continue  to  support  clean 
technologies to help scale up carbon removals. 

The Commission foresees to: 

•  assess overall objectives for carbon removals needs in line with the EU’s 2040 climate 
ambition  and  the  goal  to  reach  climate  neutrality  by  2050  and  negative  emissions 
thereafter. 

•  develop  policy  options  and  support  mechanisms  for  industrial  carbon  removals, 

including if and how to account for them in the EU ETS. 

• 

in parallel, boost EU research, innovation and early-of-a-kind demonstration for novel 
industrial  technologies  to  remove  CO2  under  Horizon  Europe  and  the  Innovation 
Fund.  

47 For example, current estimates suggest a future cost of BECCS (including storage) of around  EUR 52-134/tCO2. 
(original values in USD. 1 USD = EUR 0.92). In Bednar, Johannes & Höglund, Robert & Möllersten, Kenneth & 
Obersteiner, Michael & Tamme, Eve.  (2023). The role of carbon dioxide removal in contributing to the long-term 
goal of the Paris Agreement. 
48 Ibid. 

15 

 
 
 
 
4.4 

Using captured CO2 as a resource to replace fossil fuels in industrial production 

Capturing  CO2  and  recycling  it  to  produce  advanced  synthetic  fuels,  chemicals,  polymers  or 
minerals  is  another  important  and  innovative  aspect  of  an  industrial  carbon  management  value 
chain.  It  also  contributes  to  the  circular  economy  model,  which  will  gain  further  importance 
under the climate action framework up to 2040. The production of chemicals and materials still 
relies  heavily  on  fossil-based  feedstocks,  which  will  be  gradually  substituted  by  alternative 
49. So, by replacing fossil-
feedstocks, like sustainable biomass, recycled waste and captured CO2
based feedstocks, CCU can contribute to emission reduction,  energy security and autonomy of 
the EU.  

Moreover,  CCU  promotes  industrial  symbiosis  and  better  integration  of  processes  within 
industrial  clusters.  To  this  end,  CCU  related  infrastructure  should  be  implemented  in  a 
decentralised  way,  connecting  sources  of  industrial  emissions  to  production  sites  across  value 
chains at local level, without necessarily requiring large CO2 transport infrastructure. Access to 
hydrogen  is  also  needed  to  enable  CCU  technologies.  Therefore,  synergies  between  CCU 
applications and hydrogen networks can play a key role to boost decarbonisation. However, the 
benefits of these CO2 utilisation technologies are not yet fully recognised, nor is their capacity to 
provide  an  alternative  source  of  carbon  to  replace  fossil  carbon  in  specific  sectors  of  the  EU 
economy  that  are  carbon-dependent.  The  assessment  of  the  full  climate  benefit  of  each  CCU 
application  as  alternative  to  a  fossil-based  product  will  have  to  take  into  account  the  energy 
consumption to power this energy-intensive process. 

Certain uses of captured CO2 in products are supported by legislation50. These rules  encourage 
the  deployment  of  CCU-based  fuels  to  replace  fossil  fuels  in  key  sectors,  with  safeguards  in 
place to ensure that they provide the required minimum GHG emission savings. 

The  ETS  Directive  provides  a  maximum  of  20  million  allowances  from  2024  to  2030  to  be 
allocated for free to aircraft operators to cover the remaining cost-difference for the deployment 
of  renewable  fuels  of  non-biological  origin  and  sustainable  alternative  fuels51.  The  ReFuelEU 
aviation52  rules  also  require,  from  2030,  renewable  fuels  of  non-biological  origin  (RFNBO)  to 
cover also synthetic fuels produced with renewable energy through CCU. Similarly, the FuelEU 
Maritime  Regulation53  puts  in  place  a  special  incentive  regime  to  support  the  uptake  of 
RNFBOs54. The use of such CCU fuels will also be recognised in the EU ETS to avoid double 
counting the embodied carbon emissions. 

The 2023 revision of the EU ETS Directive also acknowledges the permanence of carbon storage 
in  certain  types  of  products.  The  Commission  is  preparing  a  delegated  act  to  specify  the 
conditions under which permanent storage can be recognised, to put permanent CCU and CCS 

49 Transition pathway for the chemical industry (link) 
50 Directive (EU) 2018/2001 and Commission Delegated Regulation (EU) 2023/1185. 
51 Article 3c(6) of Directive 2003/87/EC. 
52 Regulation (EU) 2023/2405. 
53 Regulation (EU) 2023/1805. 
54 The FuelEU Maritime Regulation also provides a review clause for the possible inclusion of carbon capture and 
temporary storage onboard ships. 

16 

 
 
 
on an equal footing in the ETS. Consistent with the EU ETS framework, the EU carbon removal 
certification  framework  will  give  the  option  to  certify  carbon  removals  generated  by  industrial 
activities  storing  atmospheric  or  biogenic  carbon  in  products  in  a  manner  that  prevents  the 
carbon to be re-emitted to the atmosphere. 

However,  additional  measures  are  needed  to  recognise  the  potential  climate  benefits  of  using 
sustainable  carbon  from  captured  CO2  rather  than  fossil  carbon  for  other  applications.  In  the 
chemical industry, captured CO2 could be used as feedstock to substitute fossil-based feedstocks, 
e.g.  in  the  manufacturing  of  polymers,  plastics,  solvents,  paints,  detergents,  cosmetics  and 
pharmaceuticals. The annual carbon demand for the chemical sector alone in Europe is currently 
estimated  around  125  million  tonnes,  or  about  450  million  tonnes  CO2  equivalent,  more  than 
90 % of which is supplied with fossil carbon55. 

It  is  crucial to  promote  sustainable carbon cycles and  significantly decrease the reliance of the 
chemical  industry  on  fossil  feedstocks  and  to  make  use  of  sustainable  carbon  sources  in  those 
sectors where they are most needed and can achieve the highest climate benefit. It can be done 
by  supporting  circular  models,  harnessing  a  circular  and  sustainable  EU  bioeconomy  and 
stimulating  the  use  of  captured  CO2  as  a  new  carbon  resource,  while  taking  into  account  the 
related energy requirement and cost challenges.  

To  play  a  significant  role  in  the  EU  economy,  existing  structural  challenges  and  regulatory 
barriers to the deployment of CCU technologies need to be identified and addressed. There needs 
to be a framework for CCU that tracks the source, transport and use of several hundred million 
tonnes  of  CO2.  It  should  ensure  environmental  integrity,  including  liabilities  for  CO2  leakage, 
and  create  a  price  incentive  that  accurately  reflects  the  climate  benefit  of  a  solution  across  the 
industrial carbon management value chain. 

To  provide  an  efficient  and  effective  incentive,  the  framework  must  build  on  a  robust  and 
transparent  accounting  system  that  gives  every  operator  in  the  value  chain  a  clear  and  direct 
incentive  for  action  that  is  not  dependent  on  the  actions  of  other  upstream  or  downstream 
operators.  

The  2026  review  of  the  EU  ETS  will  assess  several  issues,  including  whether  the  EU  ETS 
accounting system ensures that all emissions are accounted for and avoids double counting when 
CO2 captured is used in products that are not considered as permanent in an ETS context. It will 
assess whether the CO2 potentially released from non-permanent CCU products and fuels should 
be accounted at the point of emission to the atmosphere (‘downstream accounting’) or when the 
CO2 is initially captured (‘upstream accounting’).  

The  2026  review  of  the  EU  ETS  will  also  assess  the  feasibility  of  including  municipal  waste 
incineration  installations  in  the  EU  ETS,  and  the  possibility  of  including  other  waste 
management  processes,  in  particular  landfills,  taking  into  account  relevant  criteria  such  as 
environmental integrity and alignment with the objectives of the circular economy and the Waste 

55 Kähler, F., Porc, O. and Carus, M. 2023. RCI Carbon Flows Report: Compilation of supply and demand of fossil 
and renewable carbon on a global and European level. Editor: Renewable Carbon Initiative, May 2023. (link). 

17 

 
 
 
Directive56. It would assess in particular whether including these sectors in in the EU ETS could 
help  recognise  non-permanent  CCU  as  a  pathway  to  reduce  surrender  obligations  by  pricing 
emissions downstream. 

The Sustainable Carbon Cycles Communication57 also set the objective of achieving 20% of the 
carbon used in the chemical and plastic products originating from sustainable non-fossil sources 
by  2030.  To  achieve  this  objective,  action  is  needed  to  develop  with  the  chemical  industry  a 
pathway for production routes that substitute fossil carbon with sustainable carbon. 

Achieving  these  objectives  will  require  support  for  innovative  technologies  that  capture  CO2 
from the atmosphere or from industrial waste streams and turns it from a pollutant into a valuable 
resource. The captured CO2 can then be converted to all sorts of sustainable products, including 
fuels, chemicals or mineral materials. 

Such  support  should  be  available  for  technologies  at  all  levels  of  technological  readiness.  It 
should  draw  on  the  Horizon  Europe  programme  for  exploratory  research,  the  European 
Innovation Council for CCU applications that have already achieved a certain level of maturity 
and the Innovation Fund for pre-commercial projects with the potential for scale-up. 

The Commission foresees to: 

•  assess demand pull options, in concertation with industries, to increase the uptake of 
sustainable  carbon  as  a  resource  in  industrial  sectors  in  full  consideration  of  the 
Commission’s upcoming Biotech and Biomanufacturing initiative.  

•  use  the  knowledge-sharing  Platform  for  industrial  CCUS  projects  to  co-develop  with 

industries sector specific roadmaps on CCU activities.  

•  draw  up  a  coherent  framework  to  account  for  all  industrial  carbon  management 
activities that accurately reflect the climate benefits across their value chains, and to 
incentivise  the  deployment  of  innovative  and  sustainable  permanent  and  non-
permanent CCU applications, while removing barriers. 

5.  Creating an enabling environment for industrial carbon management 

To unlock the full potential of industrial carbon management, favourable conditions need to be 
created for the development of  every element  of the  carbon value chain. This  implies not  only 
fit-for-purpose  regulation,  but  also  investment  and  funding,  both  for  research,  innovation  and 
early  deployments.  Certainty  for  investors  and  viable  business  cases  also  requires  public 
understanding  and  awareness  of  industrial  carbon  management  solutions.  Finally,  as  the  cross-
border  dimension  is  crucial  for  the  scale  up  of  industrial  carbon  management,  international 

56 Directive 2008/98/EC. 
57 COM(2021) 800 final. 

18 

 
 
 
 
cooperation will be necessary  to  maximise the potential  of mitigating  emissions  in Europe and 
beyond.  

5.1 

Investing and funding the clean carbon transition 

The proposed NZIA target of 50 million tonnes of annual CO2 storage capacity by 2030 requires 
approximately EUR 3 billion investments in carbon storage facilities, depending on the locations 
and  capacity  of  the  geological  storage  sites58.  Furthermore,  a  Commission  report  estimates 
investment needs for the transport infrastructure of pipelines and ships associated with the NZIA 
target at between about EUR 6.2 and 9.2 billion by 203059. Finally, the capture costs from point 
sources are estimated to range from EUR 13/t and EUR 103/t of CO2 depending on the industry, 
capture  technology  and  CO2  concentration.  In  addition,  a  report  prepared  by  industry 
stakeholders for the CCUS Forum estimates a funding shortfall of cumulatively EUR 10 billion 
by 2030 for currently announced CCS projects60
. 

Beyond  2030,  the  Commission  estimates  that  the  required  investment  needs  in  CO2  transport 
infrastructure would rise to between EUR 9.3 and 23.1 billion in 2050 to meet the 2040 and 2050 
objectives, set out in the EU’s 2040 climate target communication.  

Despite increasing investment needs, the CCUS Forum report expects that a commercially viable 
market  will  begin  to  take  shape  after  2030,  where  investors  can  earn  a  competitive  return  on 
invested capital  based on the  EU carbon price.  The carbon price signal  in  the EU ETS  will be 
key to make CCS projects commercially viable, factoring in the costs of capture, transport and 
storage of CO2 on the one hand and the price of emitting the same amount of CO2 on the other 
hand.  

Additionally,  the  introduction  of  tariffs,  new  financing  instruments,  guarantees  and  risk 
instruments would be required to facilitate investments. Ultimately, these investment needs are 
set against an estimated extrapolated theoretical market potential of captured CO2 in the EU of 
between 360 and 790 million tonnes of CO2, which could generate between EUR 45 billion and 
EUR  100 billion  in  total  economic  value  of  the  future  CO2  value  chain  in  the  EU  from  2030 
onwards and help create between 75 000 and 170 000 jobs61.  

58  SWD(2023)  68  final,  Investment  needs  assessment  and  funding  availabilities  to  strengthen  EU's  Net-Zero 
technology manufacturing capacity. 
59 Tumara, D., Uihlein, A. and Hidalgo González, I. Shaping the future CO2 transport network for Europe, European 
Commission, Petten, 2024, JRC136709. 
60 These projects add up to 80 million tonnes of CO2 captured. A Vision for Carbon Capture, Utilisation and Storage 
in the EU prepared for the European Union’s CCUS Forum by the CCUS Vision Working Group, April 2023 (link). 
The  analysis  is  based  on  existing  European  and  national  funding  available  for  CCS  projects,  and  the  investment 
needs  based  on  the  net  present  value  of  capture,  transport  and  storage  costs  of  projects  in  the  CATF  European 
carbon capture and storage database. 
61 SWD(2023) 219 final, staff working document for a Regulation of the European Parliament and of the Council on 
establishing  a  framework  of  measures  for  strengthening  Europe’s  net-zero  technology  products  manufacturing 
ecosystem  (Net  Zero  Industry  Act),  based  on  “The  potential  of  a  European  CCS  market  viewed  from  a  Danish 
perspective”, Kraka Advisory, March 2023. 

19 

 
 
 
In the period up to 2030, additional support at EU and national level is critical to developing and 
scaling  up  industrial  carbon  management  solutions,  including  investments  to  develop  the 
necessary  skills.  First-of-a-kind  industrial  carbon  management  projects  are  costly  and  final 
investment decisions depend on many factors. This includes  the ability to combine public and 
private  finance.  Furthermore,  coordination  is  needed  between  such  projects  and  other 
stakeholders, in particular energy and transport operators, to lay the ground for final investment 
decisions.  

Today,  bridging  grant  funding  mechanisms,  including  the  EU  ETS  Innovation  Fund,  remain 
available  to  provide  some  financing  for  deployment  of  selected  innovative  large  scale  CO2 
projects. To date, the Innovation Fund has allocated support under the EU ETS Directive to 26 
large- and small-scale CCS and CCU projects with more than EUR 3.3 billion in grants.  

The  Connecting  Europe  Facility  (CEF)  Energy  is  another  key  EU  support  mechanism  for  the 
development  of  cross-border  energy  and  transport  infrastructure  projects.  So  far,  CEF  has 
granted around EUR 680 million to CO2 projects of common interest.62 Market-based finance for 
economically  viable  CCS  and  CCU  projects  can,  in  principle,  also  be  supported  under  the 
InvestEU Fund63. 

Furthermore,  the  Recovery  and  Resilience  Facility  is  available  to  Member  States  to  support 
investments  in  carbon  capture64.  On  State  aid  for  industrial  carbon  management  solutions,  the 
Guidelines  on  State  aid  for  climate,  environmental  protection,  and  energy65  and  the  General 
Block  Exemption  Regulation66  include  conditions  under  which  State  aid  for  CCS  and  CCU 
investments would be permissible. CCS is also included in the EU sustainable finance taxonomy, 
a classification system developed to identify and define economic activities that are considered 
environmentally sustainable.67 The European Investment Bank has included carbon capture and 
storage in its EUR 45 billion financing package to support the Green Deal Industrial Plan68. 

To close the gap between the carbon price and the cost of industrial carbon management projects, 
Member  States  can  look  at  proposing  ‘Carbon  Contract  for  Difference’  (CCfD)  schemes  with 
subsidies covering the difference between a carbon reference price and an agreed ‘strike price’ 
representing  the  project’s  true  costs69.  This  method  of  support  provides  a  predictable  revenue 
stream for project developers and is a good solution to de-risk investment. 

62 Regulation (EU) 2021/1153. 
63 Due to the higher-risk nature of CCS and CCU projects, InvestEU Fund-supported finance of financial institutions 
could complement grant funding from other EU or national sources or  could be provided as ‘blending operations’ 
combining resources from InvestEU and other Union programmes.  
64 For example, Denmark and Greece have included carbon capture projects in their resilience and recovery plans. 
State aid rules apply in the framework of the Facility. 
65  Communication  from  the  Commission  (2022/C  80/01).  Guidelines  on  State  aid  for  climate,  environmental 
protection and energy 2022. 
66 Regulation 2014/651/EC. 
67 Regulation 2020/852/EC. 
68 EIB to support Green Deal Industrial Plan with EUR 45 billion in additional financing (link).  
69  Certain  Member  States  have  implemented  CCfD  schemes  to  provide  targeted  and  necessary  support  for 
decarbonisation projects, including for carbon management deployments, in line with the applicable State aid rules. 

20 

 
 
 
To  move  beyond  the  initial  stage  with  large-scale  net-zero  strategic  projects,  the  carbon  price 
signal  in  the  EU  ETS  will  be  key  to  make  CCS  projects  commercially  viable,  factoring  in  the 
costs of capture, transport and storage of CO2 on the one hand and the price of emitting the same 
amount of CO2 on the other hand. 

Where  public  support  is  needed,  an  EU-wide  mechanism  under  the  Innovation  Fund  could  be 
envisioned  as  a  joint  “auctions-as-a-service”  support  mechanism  that  would  enable  EEA 
countries to use their national budget to award support to projects located on their territory based 
on  a  EU-wide  auction  mechanism.  This  could  accelerate  projects  in  the  single  market  and 
identify the most competitive and environmentally effective projects, in line with State aid rules 
and with sufficient competing national projects. A first competitive bidding mechanism is being 
pioneered  under  the  Innovation  Fund’s  pilot  auction  for  renewable  hydrogen  production  in  the 
EU70. To participate in joint support mechanisms, interested countries must follow the State aid 
notification process71. 

In  addition,  the  successful  adoption  of  battery  and  hydrogen  as  important  projects  of  common 
European interest (IPCEI) has shown that close cooperation with Member States and companies 
willing to undertake ambitious innovative or open infrastructure projects brings good results on 
complex  cross-border  integrated  projects  that  are  important  due  to  their  contribution  to  EU 
objectives.  

In  October  2023,  the  Commission  launched  a  Joint  European  Forum  for  Important  Projects  of 
Common  European  Interest  (JEF-IPCEI)  to  focus  on identifying  and  prioritising  strategic 
technologies for the EU economy that could be relevant candidates for future IPCEIs72. Member 
States  may  therefore  make  use  of  the  JEF-IPCEI,  which  brings  together  experts  from  Member 
States and the Commission services, as a platform for coordinated and transparent selection and 
design of a possible IPCEI in the area of industrial carbon management.  

The Commission foresees to: 

•  work,  as  of  2024,  with  Member  States  in  the  transparent  and  coordinated  design  of  a 
possible important project of common European interest for CO2 transport and storage 
infrastructure  via  the  JEF-IPCEI.  To  start  the  process  as  soon  as  possible,  use  the 
existing  CCUS  Forum  platform  to  ensure  good  coordination,  set  the  timing,  monitor 
progress  and  maintain the  pace  of  the  project.  Consider  establishing  a dedicated  high-
level platform to work beyond 2030. 

•  assess  by  2025  whether  certain  CO2  capture  installations,  such  as  cement  or  lime 
production  facilities,  are  mature  enough  and  sufficient  competition  may  be  expected  to 
move from project-based grant support to a market-based funding mechanisms, such as 
competitive bidding auctions as a service under the Innovation Fund. 

70 See: Competitive bidding: A new tool for funding innovative low-carbon technologies under the Innovation Fund, 
(link). 
71  In  addition  to  joint  support  mechanisms,  Member  States  retain  the  possibility  to  set  up  independent  support 
schemes, in line with State Aid rules.  
72 Link. 

21 

 
 
 
•  engage, as of 2024, with the European Investment Bank on financing of CCS and CCU 

projects. 

• 

facilitate  investment  needs  in  industrial  carbon  management  up  to  2040  and  2050, 
including by making smart use of public funding to leverage private investment. 

5.2 

Public awareness 

As industrial carbon management infrastructure projects are necessary for Europe to reach net-
zero  and  will  need  public  funding  at  least  in  the  initial  deployment  phase,  it  is  essential  that 
Member States stimulate and support an inclusive, scientifically informed and transparent debate 
on  all  industrial  carbon  management  technologies.  Moreover,  ensuring  social,  environmental, 
and  health  safeguards  will    be  key  in  supporting  responsible  implementation  and  public 
adherence. The engagement of public authorities, project developers, NGOs and the civil society 
should  take  place  before,  during  and  after  the  policymaking  and  project  implementation.  It  is 
essential to involve all stakeholders proactively so that it is not a one-way information process 
and to consider awarding local populations for hosting carbon management infrastructure. 

Based  on  their  identified  decarbonisation  objectives,  Member  States  should  engage  all 
stakeholders  working  on  national  industrial  carbon  management  strategies.  In  addition  to 
stimulating  a  national  debate  on  industrial  carbon  management  in  the  context  of  the  climate 
targets,  such  discussions  should  also  set  out  the  economic  rationale  behind  the  support  for  the 
technology  and  its  application,  the  resulting  opportunities  and  also  the  costs,  safety  and 
environmental  concerns  and  risks,  and  regulatory  actions  addressing  these  concerns.  These 
discussions should also take place internationally.  

The Commission will use the CCUS Forum and other Commission fora, including the European 
Sustainable  Energy  Week,  to  stimulate  public  debate  and  increase  public  understanding  and 
awareness  on  industrial  carbon  management.  It  will  also  contribute  to  the  public  debate  at 
national  and  local  levels  by  sharing  data  and  experience  from  projects  it  supports,  including 
under the Innovation Fund and the Trans-European Energy Networks. 

The  Commission  will  monitor  public  opinion  on  industrial  carbon  management,  including 
through  Eurobarometer  surveys,  and  it  will  encourage  Member  States  to  measure  public 
awareness at national level. EU research funding programmes on industrial carbon management 
will include topics on public perception.  

The Commission foresees to: 

•  work with Member States to specify operating conditions for CO2 transport and storage 

projects that can reward local communities for hosting them. 

•  work  with  Member  States  and  industry  to  increase  knowledge,  awareness  and  public 

debate on industrial carbon management. 

22 

 
 
 
5.3 

Research and innovation 

Investments in research and innovation yield significant cost reductions. Stakeholders highlight a 
clear potential for innovation to drive efficiency and cost reductions and to improve integration. 
During  the  period  2007-2023,  the  Commission  has  invested  more  than  EUR  540  million  in 
innovative  CCUS  solutions  through  its  successive  framework  programmes  for  research  and 
innovation (FP7, Horizon 2020 and Horizon Europe). The Commission will continue to invest in 
research  and  innovation  for  all  industrial  carbon  management  technologies,  including  new 
solutions, to increase the availability of technologies on the market as well as meeting mid- and 
long-term targets. 

Pre-normative research based on open data can contribute to standardisation work. For example, 
we  currently  lack  a  complete  picture  on  the  physical  and  chemical  behaviour  of  impure  CO2. 
Research  and  innovation  are  needed  to  further  optimise  carbon  capture  technologies  (e.g. 
purification)  and  increase  its  energy  efficiency.  Fundamental  research  is  therefore  needed,  and 
concepts are also needed to track or monitor all relevant impurities. In cases such as this, access 
to  readily  available  and  open  data  is  needed  for  research  to  support  components  for 
standardisation and help avoid overly strict limitations.  

As a growing number of CCUS projects are on track to become operational before 2030, there is 
great  value  in  aggregating  these  industrial-scale  projects  into  a  knowledge-sharing  platform  to 
facilitate  the  collection  and  sharing  of  information  and  best  practices  on  and  between  CCUS 
projects in the EU. The Innovation Fund has already started this work with the projects that have 
received  a  grant.  The  current  focus  of  the  knowledge  sharing  is  on  lessons  learned  on  how  to 
reach  final  investment  decisions,  including  matching  capture  and  storage  volumes,  permitting 
and addressing inter-value chain risks.  

In  future,  knowledge  sharing  will  encompass  capture  technologies,  transport  and  storage 
infrastructure,  storage  site  characteristics,  regulatory  aspects,  needs  for  standards,  access  to 
funding and stakeholder management. This will also cover lessons learned on public engagement 
and  on  sharing  best  practice  of  dialogues  between  project  developers,  local  and  national 
authorities. The knowledge sharing platform will be open to all projects that are ready to share 
information  and  cooperate  without  disclosing  commercially  sensitive  information  and  in  full 
compliance with single market competition rules. 

The  lessons  learned  from  the  industrial  projects  should  feed  back  into  national  and  European 
programmes  for  research  and  innovation  to  close  knowledge  gaps  and  accelerate  the 
development of new technologies. 

The Commission foresees to: 

•  support  a  new  collaboration  and  knowledge-sharing  platform  for  industrial  CCUS 

projects. 

•  continue  to  invest  in  R&I  for  industrial  carbon  management  technologies,  including 

23 

 
 
 
energy  and  cost  efficiency  optimisation  of  processes  and  pre-normative  research  to 
contribute to standardisation. 

5.4 

Cross-border and international cooperation 

The  successful  deployment  of  scalable  industrial  carbon  management  systems  will  also  be 
required for our global partners and critical for meeting their targets under the Paris Agreement. 
For example, the United States uses its Bipartisan Infrastructure Law to support direct air capture 
and  has  increased  the  tax  credits  for  carbon  capture  and  permanent  storage  under  the  Inflation 
Reduction  Act.  The  UK  published  its  vision  for  carbon  capture,  use  and  storage  in  2023,  and 
aims to develop a market to capture 20-30 Mtpa of CO2 by 2030.73 The business opportunities 
for EU industries are therefore global in scale. Cooperation with other frontrunner countries with 
the aim of pricing carbon and reducing the costs of value chains will also provide opportunities 
to accelerate the pace of GHG emission reductions world-wide. 

At the same time, there are clear opportunities to cooperate across borders. The first commercial 
cross-border agreement to capture CO2 produced in the EU and ship it for storage in Norway has 
already  been  signed74.  For  Member  States  of  the  European  Economic  Area  (EEA),  the 
implemented  EU  legal  framework  is  the  relevant  ‘arrangement’  between  the  Parties  in  the 
meaning of Article 6(2) of the international 1996 Protocol to the Convention on the Prevention 
of  Maritime  Pollution  by  Dumping  of  Waste  and  Other  Matter,  1972  (the  ‘London  protocol’). 
Accordingly, any operator of CO2 transport networks and/or CO2 storage sites can draw the full 
benefit of the EU's legal framework to import or export captured CO2 within the EEA.  

For the time being, the only way of extending such benefits to non-EEA countries would be to 
operate storage sites under an ETS that is linked with the EEA ETS75 and under a framework that 
provides legal safeguards equivalent to the EU’s CCS Directive.  

A potential future recognition of CO2 storage sites in third countries without a linked ETS would 
depend on there being equivalent conditions to ensure permanently secure and environmentally 
safe  geological  storage  of  captured  CO2,  provided  that  the  storage  is  not  used  to  increase 
hydrocarbon  recovery  and  that  this  leads  to  an  overall  reduction  in  emissions.  EU  candidate 
countries  considering  temporary  carbon  pricing  systems  -  if  linked  with  the  ETS  -  present 
particular welcome potential for cooperation in the pre-accession period.  

Internationally,  the  Paris  Agreement  requires  parties  to  measure  and  report  progress  on  their 
GHG  emission  reduction  targets,  and  to  account  for  their  nationally  determined  contribution. 
This  includes  reporting  on  carbon  removals  by  sinks  and  other  industrial  carbon  management 

73 The White House (2023) Clean Energy Economy:  A Guidebook to the Inflation Reduction Act‘s investments in 
clean energy and climate action, Jan. 2023 & Department for Energy Security and net Zero (2023), Carbon Capture 
Use and Storage: A vision to establish a competitive market, December, 2023. 
74  Yara  invests  in  CCS  in  Sluiskil  and  signs  binding  CO2  transport  and  storage  agreement  with  Northern  Lights 
(link). 
75 By agreement under Article 25 of Directive 2003/87/EC.  

24 

 
 
 
 
activities. Emissions and removals must be counted and claimed only once and by one party to 
avoid double counting. 

The reporting of industrial carbon management activities in GHG inventories under the United 
Nations  Framework  Convention  on  Climate  Change  (⁠UNFCCC⁠)  is  a  key  topic  to  tackle. 
Particular  attention  should  be  given  to  international  value  chains  where  the  CO2  is  captured, 
transported, stored or used in different countries. These include imported CCU-based fuels used 
in  the  EU  as  well  as  international  carbon  removal  value  chains,  for  instance  in  BioCCS  or 
DACCS  operations.  The  Intergovernmental  Panel  on  Climate  Change  (IPCC)  will  play  an 
essential role in providing clear guidelines and methodologies to properly report all type of CCS, 
CCU and industrial carbon removal operations in the UNFCCC GHG inventories  

International collaboration will also be necessary to maximise the potential of industrial carbon 
management in mitigating CO2 emissions on a global scale, such as through the Carbon Dioxide 
Removal  Mission  under  Mission  Innovation76.  In  particular,  developing  a  common 
understanding  on  how  to  permanently  store  CO2  away  from  the  atmosphere  geologically  or  in 
durable products could help accelerate and scale up projects, and make them more economically 
viable and efficient. 

The EU should contribute to international exchanges and workshops with industry, academia and 
government  as well as international organisations  on industrial carbon management to mitigate 
CO2 emissions  on a global  scale and also  to  enable EU  companies to  operate on third country 
markets.  It  will  also  be  important  to  engage  with  third  countries  to  ensure  that  third  country 
markets  remain  open  for  the  access  of  EU  industry  and  technologies  and  vice  versa,  notably 
public procurement markets. 

The  G7  confirmed  that  while  the  immediate,  sustained  and  rapid  reduction  of  GHG  emissions 
remains a key priority, to achieve the net-zero targets, rolling out carbon removal processes with 
robust  social  and  environmental  safeguards,  such  as  strengthening  natural  sinks,  BioCCS  and 
DACCS,  will  be  essential  to  help  counterbalance  residual  emissions  from  sectors  that  are 
unlikely  to  achieve  full  decarbonisation.  The  G7  also  recognised  that  ‘CCU/carbon  recycling 
and  that  CCS  can  be  an  important  part  of  a  broad  portfolio  of  decarbonization  solutions  to 
achieve net-zero emissions by 2050’. 

The Commission foresees to: 

•  work  towards  accelerated  international  cooperation  to  promote  harmonised  reporting 
and accounting of industrial carbon management activities, to ensure they are accurately 
accounted for under the UNFCCC transparency framework; 

•  work  to  ensure  that  internationally  carbon  pricing  frameworks  focus  on  the  necessary 
emissions  cuts  while  providing  for  carbon  removals  to  tackle  emissions  in  the  hard-to-
abate sectors. 

76 Co-led by Canada, US and Saudi Arabia, with participation of the European Commission, Australia, India, Japan 
and Norway (link). 

25 

 
 
 
6.  Conclusion 

To  reach  climate  neutrality  by  2050  and  provide  EU  economy  with  all  the  means  to  reach  the 
2040  climate  ambition,  the  EU  needs  to  develop  a  common  and  comprehensive  policy  and 
investment  framework  for  all  aspects  of  industrial  carbon  management.  Industrial  carbon 
management will be needed to complement mitigation efforts for hard-to-abate emissions and to 
achieve negative emissions after 2050. 

The technological solutions to capture, transport, use and store CO2 are available, but they need 
to be rolled out commercially and at scale, both in existing industries and to start removing CO2 
from  the  atmosphere.  Yet,  companies  that  deploy  them  today  identify  high  costs  of  carbon 
capture,  storage  and  use,  and  multi-faceted  market  failures  that  need  to  be  addressed  with  an 
integrated European approach to industrial carbon management. 

Many Member States have mapped theoretical geological storage sites, but these sites now need 
to  be  turned  into  bankable  CO2  storage  capacity.  This  requires  not  only  investments,  but  also 
building  a  broad  public  understanding  that  storing  CO2  underground  can  be  a  reliable  climate 
solution and a profitable business. It also requires putting in place CO2 transport infrastructure. 

Once captured, CO2 becomes a valuable commodity, especially if it is captured from bio-sources 
or the atmosphere. It should be used more widely in manufacturing processes, in particular for 
chemicals  and  plastics  that  today  use  crude  oil  and  natural  gas,  as  well  as  the  production  of 
sustainable fuels to tackle hard-to-abate transport. 

To create an ambitious industrial carbon management in the EU, support is needed for projects 
that  use  these  technologies  and  share  knowledge.  Member  States  and  the  Commission  need  to 
work together to develop and put in place the policy framework needed to increase certainty for 
investors, while engaging local communities in areas where geological CO2 storage can be used 
to help the economy decarbonise.  

All such solutions must first and foremost produce real and quantifiable benefits for citizens, the 
environment  and  the  climate.  With  this  Strategy,  industrial  carbon  management  is  a  legitimate 
and economically promising pathway for the EU towards climate-neutrality by 2050. Concerted 
efforts of the Commission, Member States, industry, citizen groups, research communities, social 
partners and other stakeholders will be essential to its swift implementation.  

26