The EU enabling legal framework for carbon capture and geological storage

AbstractAs part of the Barroso Package on Climate Change and Energy, adopted on 23 January 2008, the European Commission proposed an enabling legal framework for carbon capture and geological storage. This paper sets out and explains the approach. The legal framework comprises a Proposal for a Directive on the geological storage of sarbon dioxide (COM(2008)18 final) and explicit recognition of capture, transport and storage of CO2 in the proposal amending Directive 2003/87/EC so as to improve and extend the greenhouse gas emissions allowance trading system of the Community (COM(2008)16 final). The first proposal covers the regulation of the elements of the CCS chain. Capture and transport are regulated using existing legal frameworks, but the proposal lays out a dedicated legal framework for storage. The framework builds on the IPCC 2006 Inventory Guidelines and the OSPAR 2007 risk management framework for CCS, and covers site exploration, selection, permitting, monitoring, reporting, measures in case of leakage, liabilities, financial provisions for any leakage, and access to the transport and storage network. The second proposal provides that capture, transport and storage of CO2 are activities under Annex I of the Emissions Trading Directive, without any free allocation (as they are abatement activities). Emissions captured, transported and safely stored will be considered as not emitted under the ETS, but allowances will have to be surrendered for any leakage. Auctioning revenues from the third phase of the ETS (which proposes full auctioning for the power sector) will provide a potential source of finance for CCS demonstration