Carbon emitters in Europe using offshore carbon dioxide (CO2) storage would benefit from 21% cost savings, according to a new report from The Carbon Capture and Storage Association (CCSA).
The Accelerating a Europe-wide CO2 storage market report found emitters in EU27 countries would also benefit from a €16/t reduction in the cost for offshore transport and storage, representing 28% cost savings – though current policies are a barrier.
With the EU alone projected to need 164 MtCO₂pa of offshore CO2 storage by 2040, this would represent €2.6bn in annual savings, the report states.
The report, based on modelling and analysis by Xodus Group, shows that enabling cross-border CO2 transport and storage is critical for reducing emissions efficiently and on time.
Currently, policy remains the largest obstacle to transporting CO2 across the EU-UK border, which would otherwise be technically feasible.
The CCSA report notes that the European Commission and the UK Government can take concrete actions that would send a strong signal to European businesses by signing a bilateral agreement under the Trade and Cooperation Agreement (TCA) to enable mutual recognition of each jurisdiction’s CCS regulatory regime, and amend EU and UK Emission Trading Schemes to accommodate CO2 storage outside the EU and EEA.
Moreover, there is currently no financial incentive or route to market for EU capture projects to utilise non-EEA third country CO2 storage, and no system of recognition or equivalence between the EU ETS and UK ETS.
As CCUS projects progress in the EU, Norway and the UK – with the first sites beginning operations as soon as 2026 – enabling cross-border CO2 transport and storage would make these systems more resilient.
While suitable geology for CO2 storage can be found across Europe, by far the largest known resource – and therefore the primary CO2 storage basin for North-Western Europe – is below the North Sea. The UK’s offshore CO2 storage potential is estimated at 78 billion tonnes, almost one third of Europe’s geological CO2 storage capacity.
Olivia Powis, CEO of the CCSA, said, “A Europe-wide CO2 market is within reach, but policies are standing in the way. We can cut storage costs by 20% and save billions annually if the EU and UK break down these barriers, and make cross-border CO2 storage happen now. The future of the European industry and climate action depends on it.”
The report urges policymakers to act quickly before higher cost options are locked in, or companies move their operations outside Europe, and the opportunity to prevent Europe’s deindustrialisation is lost.
It recommends the development of minimum CO2 stream specification standards to be recognised across Europe, which are not excessively restrictive, standardising methodologies for CO2 stream metering, and ensuring standardisation and alignment where possible on third-party access principles across Europe.
For a Europe-wide CO2 market to be established, supporting fit-for-purpose infrastructure and facilities will also need to be developed across the continent.
source: gasworld
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