By Valter Selén, Policy Director at Carbon Gap

Taking action on carbon removal to reach climate goals

Carbon dioxide removal (CDR) must feature high on the EU policy agenda during the next five years to keep the Paris Agreement goals in sight. An array of CDR technologies and methods that remove carbon from the atmosphere to store it durably are necessary to complement ongoing emissions reduction efforts. In the longer run, CDR will be needed to achieve net negative emissions, helping reverse some of the damage done by legacy emissions.

CDR is not only a climate necessity. It represents a critical business opportunity for the EU economy. CDR covers a suite of technologies that can advance the EU’s strategic competitiveness agenda under the new mandate. As an emerging field within cleantech, CDR has the potential to create new jobs across clean industries and supply chains. Investments in carbon removal could contribute to regional regeneration and economic growth, whilst delivering clear climate benefits. Workers across numerous sectors and geographies, from agriculture to industry, stand to benefit.

Worryingly, the current pace and scale of CDR investment and deployment is insufficient to deliver the volumes of high-quality CDR needed to achieve climate neutrality in 2050. This delay is partly due to a lack of market confidence in the role of carbon removal in EU policy, and an unclear business case that deters much-needed private investment.

Governments have a key role to play in supporting promising yet early-stage CDR methods as they transition from demonstration to deployment at scale. Currently, the EU is falling behind other global players such as the US, Canada and Switzerland – where governments have mobilised financial support that encourages international CDR firms to settle within their borders. While the EU certification framework for carbon removals (CRCF) is laudible, a failure to commit real funds to carbon removal will see CDR innovators continue to move overseas.

Moving from rule-setting to deployment and scale-up

To catch up and position the EU as a CDR innovation hub, we need a quantum leap on CDR financing, and we need it now. It will require unprecedented investment in carbon removal in the EU in the years to come. The European Commission has taken welcome steps in the right direction when it comes to supporting CDR by publishing a communication on Industrial Carbon Management and by considering a strategy for financing permanent carbon removal. Furthermore, the Clean Industrial Deal provides the EU with an opportunity to make procurement of CDR part of its efforts to deliver a green and competitive transition for Europe.

Bridging the ambition gap in the EU through procurement

The time has come for the EU to take a note from the current leaders on carbon removal by introducing a pilot public procurement programme for CDR. Such a programme would crowd in private funding for CDR by sending a political signal in support of a home-grown carbon removal sector.

A dedicated procurement programme would allow a European CDR ecosystem to develop, bringing together CDR start-ups with value chain players like . Similar programmes in the US have successfully created a multiplier effect, with small initial public purchases being multiplied by private investments.

Carbon Gap has developed a proposal for what such a programme could look like. Starting in 2025, the EU pilot procurement programme would buy permanent removals from suppliers based in the EU, with public funding to be matched or extended by private investments. It would use a relatively small budget, in the tens of millions to procure , providing an early proof of concept for the CRCF framework.

The pilot procurement programme could draw from existing EU funding mechanisms which could include the Innovation Fund (call for Net Zero Technologies – pilots), the Resilience and Recovery Facility (RRF), the LIFE sub-programme on climate change mitigation and adaptation, the Just Transition Fund, or the Cohesion Fund. New funding mechanisms such as a possible “Competitiveness Fund” should also be considered for the procurement programme.

Leveraging the Clean Industrial Deal to deliver on EU priorities

EU policymakers must act now to inspire the confidence of private sector investors seeking proof of concept for CDR. Seizing the opportunities provided by CDR would position the EU as an international trailblazer in cleantech policy,  secure competitiveness, and cement the EU’s reputation as a force for effective and just climate change action.

Any opinions expressed in this commentary reflect the views of the author and not of Carbon Pulse.