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A wave of commercial carbon storage projects will begin operating in Europe this year, marking the first time the continent has been able to transport and bury emissions at scale as the EU tightens carbon tax rules.
Heavy industrial groups are preparing to put captured CO₂ into new offshore storage sites in Norway and Denmark, driven by the next phase of the EU’s emissions trading scheme, as the bloc’s Carbon Border Adjustment Mechanism is phased in.
The acceleration has sharpened the controversy around carbon capture and storage (CCS), which environmental groups say risks delaying the shift away from fossil fuels. However, industrial groups argue that carbon capture is the only practical way to cut emissions from energy-intensive sectors in the timeframe required by European climate policy.
“We don’t have the luxury to wait for perfect solutions,” said Svein Tore Holsether, chief executive of Norwegian fertiliser producer Yara, which this year embarks on what it called Europe’s largest industrial CCS project. “This is happening now.”
Europe’s experience with carbon storage has been limited to small volumes injected at Norway’s Sleipner and Snøhvit gasfields, but larger infrastructure is now advancing. The Dutch Porthos scheme plans to store 2.5mn tonnes of CO₂ a year from Rotterdam industry, while Norway’s Northern Lights transport-and-storage network is due to open to commercial users this year.
About 800,000 tonnes of CO₂ a year will be captured from Yara’s ammonia plant in Sluiskil in the Netherlands, according to the fertiliser producer.
The emissions — a high-purity carbon stream produced during the manufacture of grey ammonia — will be liquefied on site and shipped to the Norwegian coast. It will then be pumped 2.6km under the seabed for permanent storage under a 15-year agreement with Northern Lights. The project, which involves spending about €200mn on equipment, is due to start operating in the second quarter.
The Ineos-led Greensand project in Denmark will also start injecting CO₂ into depleted North Sea oil reservoirs this year. Meanwhile Airbus has begun trialling a direct air capture system in Canada, using technology derived from life-support systems the aerospace company developed for the International Space Station.
As free allowances under the EU emissions trading scheme are phased out from this year, producers of fertiliser, steel and cement will face rising carbon costs unless they substantially reduce emissions or import lower-carbon inputs.
“This is first and foremost cost avoidance,” said Holsether. “Europe is clearly saying it is staying the course on emission reductions.”
He added that the company has been preparing for tighter regulation under the carbon border mechanism for years and viewed the Sluiskil project as central to keeping its European operations competitive.
Environmental campaigners say carbon capture must not replace cutting fossil fuel consumption. “The problem with CCS is that it’s unproven, shown not to work on the whole, is really high cost, relies on huge subsidies, and projects take time to get up and running,” said Andrew Reid, an energy finance analyst at the Institute for Energy Economics and Financial Analysis, a US-based think-tank. “The risk is that it becomes an expensive distraction which fails.”
Reid said there remained a danger that CCS “doesn’t work at scale, that many billions are spent trying and failing, and that we realise this 10 or more years from now this won’t work, putting increased pressure on 2050 carbon reduction targets”.
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Yara argues that its ammonia process is unusually well suited to carbon capture because natural gas is split into hydrogen and a nearly pure stream of CO₂ that can be captured without the complex separation needed in many other industries. Most of those emissions are released into the atmosphere.
“The technology is proven; we’re just scaling it up,” Holsether said. “This is not a pilot — it’s full scale, full blast.”
Yara has also invested in green ammonia, including one of Europe’s largest electrolysers at its Porsgrunn plant in Norway. Holsether said Europe lacked the low-cost renewable electricity needed to expand the technology rapidly.
“Neither green ammonia nor CCS is cheap, but right now CCS is much more affordable,” he said. “We simply don’t have the terawatt hours available to go massive on green.”
Policymakers argue that carbon storage on a continental scale will be required to meet Europe’s net zero objectives. Brussels has proposed creating at least 250mn tonnes a year of storage capacity by 2040, an order of magnitude larger than the projects coming online this year.