Policy support for BECCS and DACCS in Europe: the view of market participants
2024
Pu Yang | Sam Fankhauser | Stephen M Smith | Ingrid Sundvor | Stephanie Hirmer | Injy Johnstone | Joseph Stemmler
Carbon dioxide removal (CDR) is the essential ‘net’ in net zero. However, a thriving CDR industry will not come into being without government intervention. As governments start to devise CDR support policies, this paper solicits the views of market participants in two of the most prominent CDR methods: bioenergy with carbon capture and storage (BECCS) and direct air carbon capture and storage (DACCS). We survey 47 BECCS and DACCS project developers and financiers active in Europe, conducting in-depth interviews with 27 of them to identify their key challenges and preferred policy interventions to address them. We find that participants prefer compliance markets, such as links to emissions trading systems, to generate demand but seek government support to cushion early market risks. They acknowledge the need for stringent monitoring and regulation to ensure environmental integrity. Bearing industry expectations in mind, policymakers face five key challenges in developing CDR: reaching scale, striking a balance with emissions cuts, safeguarding integrity, ensuring fairness and accelerating the speed of deployment.
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