The European Union (EU) has taken a significant step towards addressing climate change by introducing a proposed law for the certification and oversight of carbon removal initiatives. This new law aims to enable income generation for businesses engaged in carbon removal and farmers who practice carbon farming. The EU believes that carbon removals must play a growing role in achieving EU climate neutrality by 2050, as they help balance out emissions that cannot be eliminated.
The agreement reached by the European Council and the European Parliament is still provisional, pending formal adoption. However, it covers the certification of four types of carbon removals: permanent carbon removal to storage, temporary carbon storage in long-lasting products, temporary carbon storage from carbon farming, and reduction of carbon emissions from farmed soil. These measures will apply to activities taking place within the EU, but the possibility of allowing geological carbon storage in neighboring third countries is being considered, as long as they align with EU environmental and safety standards.
One of the key benefits of carbon removal is that each metric ton of CO2 removed through certified carbon capture activities counts as a contribution towards the EU’s and its member states’ greenhouse gas emission reduction goals under the Paris Agreement. This is significant because participating countries are required to report their contributions to reducing greenhouse gas emissions to the United Nations every five years.
The new legislation also stipulates that certification and audit information must be made public, and an electronic EU-wide registry will be established after four years. Fees will be charged for querying the registry, and the income generated from these fees will be used to fund the registry. The certification of carbon removal will create new income opportunities for industries deploying carbon removal and storage technologies, as well as for farmers engaging in innovative carbon farming practices.
The introduction of this proposed law has not been without controversies. Changing farming practices for hundreds of years to achieve the greenhouse gas reduction goal poses a significant social and economic challenge for many farmers worldwide. Additionally, the success of carbon capture and sequestration projects has been limited, with 80% of projects failing in the last 20 years. The credibility of revenues and incentives, along with capital costs and technological readiness, are key factors in the success of these projects. One major incentive for companies has been to sell the captured CO2 to petrochemical companies for enhanced oil and gas extraction.
Furthermore, the Institute for Energy Economics and Financial Analysis (IEEFA) has highlighted concerns about the long-term efficacy of carbon capture and storage. They argue that even if the carbon dioxide can be injected underground, there is no guarantee that it will stay there and not leak into the atmosphere. Citing the failure of the In Salah project in Algeria, which was suspended after concerns about the integrity of the seal and movements of trapped carbon dioxide, the IEEFA questions the effectiveness and reliability of carbon storage.
Norway, however, has extensive experience with carbon dioxide capture and storage, operating successful projects at the Sleipner and Snøhvit sites. These projects store CO2 separated during natural gas production and inject it back underground. While these sites have been operational for many years, some experts argue that their experience raises doubts about the technical prowess, regulatory oversight, and long-term commitment needed to keep carbon dioxide sequestered permanently.
Despite these controversies, the EU’s proposed law for the certification and oversight of carbon removal initiatives marks a significant step towards addressing climate change. It will make the EU a global leader in carbon removals and foster private investment while ensuring climate integrity and preventing greenwashing. By providing income opportunities for businesses and farmers, this legislation encourages innovation and supports the EU’s goal of achieving climate neutrality by 2050. However, it also highlights the challenges and uncertainties associated with implementing carbon capture and storage projects effectively.
