EU seeks solutions to sustainably reduce CO2 levels
The deployment of permanent carbon dioxide removal (CDR) technologies is still in its early stages in Europe.
DG Climate is exploring the possibility of developing a pan-European CDR purchasing programme that would encourage investment, drive technological progress and help achieve the EU’s climate goals.
A key challenge to scaling up permanent carbon removal is the lack of sufficient demand. The lack of demand stems from the nature of CDR, which as a public good generates little private value without political intervention. While some private entities purchase limited quantities of permanent CDR in line with voluntary mitigation targets and corporate reporting, the current lack of private business cases for purchasing carbon removal highlights the need for public procurement and public policy to generate demand.
The first report, entitled ‘An EU programme for purchasing permanent carbon removal measures: assessing policy options and recommendations for short-term policy’, examines different options for purchasing CDRs at EU level. It explores the potential role of an EU-wide purchasing programme and how it could create demand for permanent CDRs in the short term (2025-2030). It recommends that the programme should not be limited to purchasing removal credits alone, but should help grow the market by strategically purchasing different types of removal credits. This approach promotes technological development and market efficiency. The report suggests using a mix of funding sources, including the EU budget, contributions from Member States and private funding, and linking with existing initiatives such as the Innovation Fund, to streamline processes and increase attractiveness.
Two additional reports examine in more detail the current situation of CDR in Europe and the funding needs.
Carbon removal in the EU: an overview of current carbon removal projects and early-stage financing - provides a comprehensive overview of the current state and future potential of permanent CDR in Europe, assessing technologies, costs, financing needs and barriers to deployment, while mapping existing and planned projects up to 2035.
Carbon removal in the EU: an assessment of existing EU funding programmes and new financing models to scale up carbon removal supply - examines EU programmes such as the Innovation Fund or Horizon Europe that support CDR companies and explores innovative financing models to strengthen early-stage CDR projects.
