Push for CCU and CCS inclusion in EU Net Zero Industry Act gains momentum

A coalition of industry leaders, environmental advocates, and policymakers have called for the inclusion of Carbon Capture and Utilisation (CCU) and Carbon Capture and Storage (CCS) technologies in the European Union’s Net Zero Industry Act (NZIA) as strategic net-zero technologies.

The joint statement, signed by the Methanol Insitute, Eurofer, and FuelsEurope, among other organizations, highlighted the pivotal role that CCU technologies play in reducing greenhouse gas emissions and the production of renewable fuels.

“CCU is of strategic importance to reach net zero objectives, and should be recognized as such also in the NZIA, considering that its relevance has been acknowledged by recent legislations and by EU funding mechanisms – in the EU Innovation Fund’s third call for large-scale projects from July 2023, out of 41 projects selected, at least 10 projects were about CCU,” the letter said, adding that these technologies will support both the realization of EU hydrogen goals and a replacement of fossil-based products.

The NZIA distinguishes between “net-zero technologies” and “strategic net-zero technologies.” Strategic net-zero technologies enjoy priority treatment from national authorities, streamlining permitting procedures, public procurement, and access to financing. Additionally, they are supported by an ambitious 40% EU annual manufacturing target.

To identify strategic net-zero technologies, the European Commission employs criteria based on:

• Technology Readiness Level (TRL): Indicating commercial availability and scale-up potential, with a minimum requirement of TRL 8.
• Greenhouse Gas (GHG) Emission Reduction: Recognizing their contribution to reducing GHG emissions.
• Economic Resilience: Evaluating their overall impact on the resilience of the EU economy.

The coalition behind the call for CCU technologies emphasizes that CCU meets all these criteria and thus qualifies as a strategic net-zero technology.

The inclusion of CCU technologies and CCS in the NZIA is deemed essential to:

1. Emission Reduction: Enable the substantial reduction of emissions and promote carbon circularity while preserving and strengthening Europe’s skilled technical workforce.
2. Investment Certainty: Ensure a predictable environment for the deployment of CCU technologies, thereby attracting investment and advancing their adoption.
3. Alignment with Legislative Priorities: Harmonize the NZIA with the technological priorities outlined in the recent Fit for 55 legislation, creating synergy in climate and energy ambitions.

While the NZIA initially excluded CCU from the list of strategic net-zero technologies, it was argued that CCU does not qualify as a manufacturing technology. Contrary to this notion, the co-signatories assert that CCU is indeed a manufacturing technology, as it involves the transformation of captured carbon into value-added products. The exclusion of CCU from the strategic net-zero technologies list is seen as a potential obstacle to its development and the realization of EU climate goals.

CCU technologies have received recognition in several EU legislative efforts, including RED III, FuelEU Maritime, ReFuelEU Aviation, REDII Delegated Regulation (EU) 2023/1185, ETS Directive, EU Carbon Removals Certification framework proposal, Sustainable Carbon Cycles Communication, and the upcoming Industrial Carbon Management Strategy. These initiatives highlight the importance of CCU in mitigating climate change, reducing emissions in hard-to-abate sectors, and promoting sustainability across various industries.

Carbon capture is vital in the context of renewable fuels of non-biological origin (RFNBO) for the maritime industry as it reduces emissions, supports sustainable fuel production, and helps transition to renewable energy sources. It has been recognized as such in the FuelEU Maritime directive. What is more, the regulation opens a window for recognition of onboard carbon capture technologies by the EU once the technology becomes more mature.

Onboard carbon capture for ships operates by capturing carbon dioxide (CO2) emissions from the ship’s exhaust gases, preventing their release into the atmosphere and facilitating their storage or utilization, thereby reducing the vessel’s carbon footprint.

The technology is still in the early stages of testing onboard several vessels and is yet in the pilot stages of development.

The signatories include the European Chemical Industry Council (Cefic), The European Cement Association (Cembureau), Cewep, CO2 Value Europe, ECFD, eFuel alliance, Eurogas, Eurofer, FuelsEurope, Methanol Institute, Renewable Carbon Initiative, and UPEI.