This paper “Potential Regulatory Frameworks for Cross-Border CO2 Transport between the EU and UK” by the Oxford Institute for Energy Studies outlines the history and current state development of CCS in Europe. Upon that basis, potential regulatory frameworks that can enable a competitive cross-border CO2 transport and storage network between Western Europe and the UK are explored and proposed.
CCS has been identified as the most-ready technology for hard-to-decarbonise sectors like cement, steel, chemicals and refining. Development has accelerated over the last few years in Europe, with several projects spanning capture, transport and storage slated to receive FID by 2025 and be online by 2030. This pace has been backed by ambitious targets of European governments – EU, UK and Norway which not only plan to either build or subsidise these networks but have also enshrined the requirement for CCS in their ambitious plans to be net-zero economies by 2050. Altogether, the continent plans to capture close to 700 MtCO2 annually by 2050, up from 1.9 MtCO2 in 2023.
Given its geological conditions, the North Sea has emerged as the main hub of CCS activity in Europe, hosting most of the storage sites under development. However, CO2 producers are limited in their ability to leverage the entire network under regulations currently in place. Together, the London Protocol and the respective ETS markets are hurdles that must be addressed for cross-border CO2 transport to be feasible. For the London Protocol, this would require either a bilateral agreement between interested EU countries and the UK along the lines of the post-Brexit TCA, or collaboration on a proposal for the London Protocol to specifically exclude CO2 from coverage by Article 6 although this may be less likely to succeed.
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