2. International and EU Law

CCS regulation has a strong international character, which is partly due to CCS activity often being transboundary. Furthermore, on the European Union (EU) level, CCS activity is partly regulated through directives such as Directive 2009/31/EC on the geological storage of CO₂

Directive 2009/31/EC of the European Parliament and of the Council of 23 April 2009 on the geological storage of CO2 and amending Council Directive 85/337/EEC, European Parliament and Council Directives 2000/60/EC, 2001/80/EC, 2004/35/EC, 2006/12/EC, 2008/1/EC and Regulation (EC) No 1013/2006 (OJ L 140, 5.6.2009, p. 114–135).

(CCS Directive) and Directive 2003/87/EC (ETS Directive)

Directive 2003/87/EC of the European Parliament and of the Council of 13 October 2003 establishing a scheme for greenhouse gas emission allowance trading within the Community and amending Council Directive 96/61/EC (OJ L 275, 25.10.2003, p. 32–46)

. In the following subchapters (2.1-2.6), international and subsequently European legislation related to CCS is presented.

The London Convention

1972 Convention on the Prevention of Marine Pollution by Dumping of Wastes and Other Matter (adopted 29 December 1972, entered into force 30 August 1975) 1046 UNTS 120 (LC).

(“the Convention”) and the London Protocol

1996 Protocol to the Convention on the Prevention of Marine Pollution by Dumping of Wastes and Other Matter 1972 (adopted 7 November 1996, entered into force 24 March 2006) 36 ILM 7 (LP).

(“the Protocol”) are both international agreements regarding the prevention of marine pollution by dumping of wastes and other matter. The objective of the agreements is to promote the effective control of all sources of marine pollution. The London Protocol is a protocol to the London Convention. Regarding states party to the Protocol which are also party to the Convention the Protocol supersedes the Convention.

Article 23 LP.

The Convention entered into force on the 30^th of August 1975. The Convention consists of a “black-list” and a “grey-list” regarding dumping of waste, where the waste listed in the former is prohibited and the latter requires a special permit.

Article 4 LC.

All other materials that are not on the two lists can be dumped after a general permit is issued.

Article 4 LC.

All Nordic countries are parties to the Convention.

For an overview of the parties to the Convention see the United Nations Treaty Series, available at: https://treaties.un.org/pages/showDetails.aspx?objid=08000002800fdd18 (last visited 2022-08-26).

The London Protocol was brought forward to modernise and eventually replace the Convention. All Nordic countries are parties to the Protocol. The Protocol has a different approach compared to the Convention as it prohibits all dumping apart from that which is explicitly permitted in Annex I to the Protocol.

Article 4 and Annex I LP.

The Protocol is, therefore, more restrictive than the Convention.

Two resolutions to amend the Protocol have been put forward. One regards the inclusion of CO₂ sequestration in sub-seabed geological formations in the Annex I to the Protocol and was adopted in 2006.

Resolution LP.1(1) on the Amendment to Include CO₂ Sequestration in Sub-Seabed Geological Formations in Annex 1 to the London Protocol 2006.

The amendment further clarifies that CO₂ streams may only be considered for dumping under three conditions. Firstly, disposal must be made into a sub-seabed geological formation. Secondly, they must consist overwhelmingly of CO₂ but may however contain incidental associated substances derived from the source material and the CCS processes used. Thirdly, no wastes or other matter are to be added for the purpose of disposing of those wastes or other matter.

See Annex I para 4 LP.

Amendments to the Annexes of the Protocol enter into force for parties to the Protocol either immediately if the party notifies its acceptance to the International Maritime Organization (IMO) or 100 days after the adoption of the amendment.

Article 22(4) LP.

CO₂ streams from CCS processes for sequestration are therefore, after the amendment, included in Annex I and can be considered for dumping under the circumstances set out above.

The second resolution to amend the Protocol regarded export of CO₂ for storage in sub-seabed geological formations. The export of wastes for the purpose of dumping or incineration at sea is prohibited in article 6 of the Protocol.

Article 6 LP.

This includes the export of CO₂ streams as defined in Annex I. To allow the export of CO₂ streams from one State for sequestration in another State an amendment to article 6 was proposed in 2009. Amendments to the Protocol enter into force for the parties accepting the amendment when two thirds of the parties to the Protocol have deposited an instrument of acceptance to the IMO.

Article 21(3) LP.

As this has not yet happened, the amendment to article 6 is not in force and the export of CO₂ streams for dumping as stated above is prohibited. As of April 2023, of the required 35 only 10 states have formally ratified the amendment to article 6 – out of the Nordic countries Norway, Finland, Sweden and Denmark.

IMO, Status of IMO Treaties, 6 January 2023, p. 571. Available at: https://wwwcdn.imo.org/localresources/en/About/Conventions/StatusOfConventions/Status%20of%20IMO%20Treaties.pdf  (last viewed 2023-04-16).

Iceland is prioritising onshore CO₂ storage (see section 3.3) and therefore has no immediate need for the amendment to enter into force, which may, at least partly, explain why there is as of yet no Icelandic ratification.

As a provisional solution to the export prohibition, parties to the Protocol can enter into bilateral agreements. This is possible due to article 25 of the Vienna Convention on the Law of Treaties (VCLT) which allows for the provisional application on a treaty or a part of a treaty pending its entry into force. Such a provisional solution is allowed if the treaty provides for such an application or the negotiating States

“Negotiating State” means a State which took part in the drawing up and adoption of the text of the treaty, see article 2(1)(e) VCLT.

have in some manner so agreed. As the London Protocol does not in itself allow for provisional application pending entry into force, the parties to the London Protocol agreed through a resolution in 2019 that the amendment of article 6 of the London Protocol can be applied provisionally.

This took place at the 41st Consultative Meeting of Contracting Parties to the London Convention and the 14th Meeting of Contracting Parties to the London Protocol (LC 41/LP 14) 7-11 October 2019, see 41st Consultative Meeting of Contracting Parties to the London Convention and the 14th Meeting of Contracting Parties to the London Protocol (LC 41/LP 14) 7-11 October 2019 (imo.org).

Parties willing to apply the amended article 6 provisionally must deposit a declaration of provisional application and provide notification of any agreements or arrangements with the IMO.

Resolution LP.5(14) on the Provisional Application of the 2009 Amendment to Article 6 of the London Protocol (adopted on 11 October 2019) para 1 & 3.

Out of the Nordic countries, Norway, Denmark, and Sweden have accepted the provisional application of the amendment of article 6 as of January 2023.

IMO, Status of IMO Treaties, Comprehensive information on the status of multilateral Conventions and instruments in respect of which the International Maritime Organization or its Secretary-General performs depositary or other functions, 6 January 2023, p. 572. Available at: https://wwwcdn.imo.org/localresources/en/About/Conventions/StatusOfConventions/Status%20of%20IMO%20Treaties.pdf (last viewed 2023-04-16).

The parties shall also come to a bilateral agreement on the export of CO₂ for geological storage. An overview of London Protocol requirements in the context of the Legal Framework in the EEA has been presented in a paper published by the European Commission.

https://climate.ec.europa.eu/document/dfbbc90c-071e-4088-ada2-7af467084b30_en

The paper concludes that the CCS Directive and the ETS Directive can act as a relevant “arrangement” between the Parties in the meaning of Art. 6(2) of the London Protocol. Similarly, the EEA treaty and the incorporation of the two directives concerned in the EEA legal regime provides the necessary arrangement with EEA partners. Furthermore, the paper concludes that Member States that are party to the Protocol could conclude additional bilateral arrangements with other EU Member States and EEA partner countries only on issues that are not covered by the directives. These additional bilateral arrangements should be strictly limited to the residual issues not covered by EU law and they should not refer to the subject matters covered by EU rules.

The Netherlands and Norway signed a Memorandum of Understanding (MoU) in November 2021 agreeing to finalise a bilateral agreement. In September 2022, Denmark, and Flanders, Belgium signed a bilateral arrangement

https://en.kefm.dk/Media/638000596525014193/Bilateral%20arrangement%20DK-BE.pdf.

which makes it possible to transport CO₂ between the two countries for the purpose of permanent geological storage.

https://en.kefm.dk/news/news-archive/2022/sep/denmark-flanders-and-belgium-sign-groundbreaking-arrangement-on-cross-border-transportation-of-co2-for-geological-storage-

Langlet (2015) has argued that the London Protocol is an international agreement where “the rights and obligations of the treaty cannot be reduced to reciprocal rights and obligations between any two Parties”.

Langlet, D. (2015). “Exporting CO₂ for Sub-Seabed Storage: the Non-Effective Amendment to the London Dumping Protocol and its Implications”, International Journal of Marine and Coastal Law, 30(3), 395-417.

Langlet argues that, from a purely legal standpoint, the provisional solution of article 6 in today’s form may not be entirely suitable since dumping in one area of the sea within one state’s territory could have effects on the sea in other states territories, due to the movement of water and the sea’s inhabitants.

Langlet, D. (2015). “Exporting CO₂ for Sub-Seabed Storage: the Non-Effective Amendment to the London Dumping Protocol and its Implications”, International Journal of Marine and Coastal Law, 30(3), p. 414.

This argument can however be seen as less prominent when applied to CO₂ storage in sub-seabed geological formations, as the movement of waste is significantly less likely compared to dumping straight into the sea. However, leakage of CO₂ can in principle occur which would mean a risk of elevated CO₂ levels in the water column. For a further analysis see Weber (2021).

Weber, V. (2021). “Are we ready for the ship transport of CO₂ for CCS? Crude solutions from international and European law”, Review of European, Comparative & International Environmental Law, 30(3), 387-395.

Another international agreement relevant to sub-seabed geological storage of CO₂ is the 1992 Convention for the Protection of the Marine Environment of the North-East Atlantic

1992 Convention for the protection of the marine environment of the North-East Atlantic (adopted 22 September 1992, entered into force 25 March 1998) 2354 UNTS 67 (OSPAR Convention).

(OSPAR Convention) which applies to the northeast Atlantic.

For a closer description of the area covered see article 1(a) OSPAR Convention and

The Convention has been ratified by, amongst others, Denmark, Finland, Iceland, Norway, Sweden, and the EU.

OSPAR. Contracting Parties. Available at: https://www.ospar.org/organisation/contracting-parties (last visited 2022-09-09).

The Parties’ general obligation under the Convention is to prevent and eliminate pollution and to take the necessary measures to protect the maritime area against the adverse effects of human activities.

Article 2 OSPAR Convention.

All dumping of waste or other matters is prohibited with certain exceptions as set out in Annex II.

Article 4 OSPAR Convention.

In 2007, an amendment was made to Annex II of the OSPAR Convention in order to exempt CO₂ streams from CCS processes for storage from the dumping prohibition under some circumstances.

https://www.ospar.org/work-areas/oic/carbon-capture-and-storage

The amendment of Annex II largely reflects the amendment of Annex I of the London Protocol mentioned above, apart from the use of the term ‘sub-soil’ instead of ‘sub-seabed’ and the additional condition that the CO₂ streams are intended to be retained in these formations permanently and will not lead to significant adverse consequences for the marine environment, human health and other legitimate uses of the maritime area.

Article 3(2)(f)(i)-(iv) Annex IIOSPAR Convention.

The OSPAR Convention therefore, does not constitute an obstacle to the sub-seabed storage of CO₂.

The 1992 Convention on Biodiversity

1992 Convention on Biological Diversity (adopted 5 June 1992, entered into force 29 December 1993) 1760 UNTS 79 (CBD).

(CBD) is also relevant to CCS activity. The objective of the CBD is in part the conservation of biological diversity and the sustainable use of its components.

Article 1 CBD.

The CBD is ratified by all Nordic countries.

Convention on Biological Diversity. List of Parties. Available at: https://www.cbd.int/information/parties.shtml (last viewed 2022-09-09).

In 2010 a decision was adopted by the Parties to the CBD regarding a moratorium on climate-related geo-engineering.

Decision Adopted by the Conference of the Parties to the Convention on Biological Diversity at its Tenth Meeting, x/33. Biodiversity and Climate Change. 29 October 2010 (Decision X/33), available: https://www.cbd.int/doc/decisions/cop-10/cop-10-dec-33-en.pdf (last visited 2022-08-26).

In short, the decision sets out that in the absence of science-based, global, transparent and effective control and regulatory mechanisms for geo-engineering, and in accordance with the precautionary approach, no climate-related geo-engineering activities that may affect biodiversity shall take place until there is an adequate scientific basis on which to justify such activities.

Para 8(w) Decision X/33.

^,

Taking into consideration the associated risks to the environment and biodiversity and associated social, economic and cultural consequences.

CCS applied to emissions from fossil fuels is explicitly stated to not be included within “geo-engineering”.

See footnote 3 of Decision X/33.

As the decision only includes a provisional definition of “geo-engineering”, the implications of the Decision on BECCS is unclear.

Upon a request from the Swedish Energy Agency’s National Centre for CCS, the Swedish Environmental Protection Agency (SEPA) has analysed the wording of the moratorium to assess its legal meaning.

Swedish the Swedish Environmental Protection Agency, yttrande, Bedömning av eventuella rättsliga hinder för att bedriva verksamhet med bio-CCS, utifrån förutsättningarna i konventionen om biologisk mångfald (CBD), 2021-11-22.

The SEPA notes that the moratorium is a Conference of the Parties (COP) decision which means it is made by the highest decision-making body under the Convention and that the Convention is legally binding. Furthermore, it is noted that the paragraph in question uses the wording that Parties ”ensure […] that no climate-related geo-engineering activities that may affect biodiversity take place”, which is more stringently expressed than other parts of the decision. That being said, the SEPA also notes that the CBD is a Convention largely based on voluntary compliance which, according to the SEPA, gives the Parties a legal space and an obligation to regulate the conditions for BECCS in more detail. The SEPA concludes that BECCS in Sweden must be in line with the intentions of the CBD and that the negative environmental effects must be studied further. It cannot be concluded therefore that BECCS is compatible with the CBD as a general rule, but there is an opening for BECCS to be allowed provided that it can be shown its implementation does not impact biodiversity negatively.

The Swedish Environmental Protection Agency, yttrande, Bedömning av eventuella rättsliga hinder för att bedriva verksamhet med bio-CCS, utifrån förutsättningarna i konventionen om biologisk mångfald (CBD), 2021-11-22.

The Swedish Energy Agency has analysed whether the moratorium includes BECCS, taking the outcome of the SEPA analysis into consideration. The analysis concluded that the moratorium is applicable to BECCS if deployment is extensive and is considered to have an impact on biological diversity. The analysis proposes that a Swedish support scheme for BECCS should require that eligible BECCS operators must be able to present a sustainability statement for the biomass used, where applicable.

Swedish Energy Agency (2023), ”Särskild redovisning av Energimyndighetens arbete med utformning av stödsystem för bio-CCS 2022”, ER 2023:11.

The final official Swedish interpretation needs to be based on a government decision.

The Danish Ministry of Environment also analysed the same issue and concluded that that the rules must be interpreted so that a moratorium in the Biodiversity Convention for geo-engineering does not include CCS activities, regardless of whether it is CCS or BECCS. In that context, they looked particularly at a definition used in the context of the London Protocol:

Resolution LP.4(8) on the Amendments to the London Protocol to regulate the placement of matter for ocean fertilization and other marine geoengineering activities.

Furthermore, Fridahl et al. (2020) have concluded that the CBD will likely not be a strong barrier prohibiting BECCS due to the soft-law nature of the Convention and the moratorium.

Fridahl, M., et al. (2020). “Mapping Multi-Level Policy Incentives for Bioenergy with Carbon Capture and Storage in Sweden”, Frontiers in climate, 2, 1-25.

The 1992 Convention on the Protection of the Marine Environment of the Baltic Sea Area (Helsinki Convention) is an updated version of a convention of the same name from 1974. The Helsinki Convention entered into force in 2000 and is ratified by, amongst others, all Nordic States in the Baltic region, namely Sweden, Finland, and Denmark as well as the EU.

HELCOM. Contracting Parties. Available at: https://helcom.fi/about-us/contracting-parties/ (last visited 2022-09-09).

The Convention applies in the Baltic Sea area.

See article 1 of the Helsinki Convention: “This Convention shall apply to the Baltic Sea Area. For the purposes of this Convention the "Baltic Sea Area" shall be the Baltic Sea and the entrance to the Baltic Sea bounded by the parallel of the Skaw in the Skagerrak at 57° 44.43'N. It includes the internal waters, i.e., for the purpose of this Convention waters on the landward side of the base lines from which the breadth of the territorial sea is measured up to the landward limit according to the designation by the Contracting Parties”.

The convention sets out to prevent and eliminate pollution in order to promote the ecological restoration of the Baltic Sea Area and the preservation of its ecological balance.

See Article 3 of the Helsinki Convention.

The dumping of waste in the sea or into the seabed is prohibited in the Helsinki Convention. Dumping is defined as “any deliberate disposal at sea or into the seabed of wastes or other matter from ships, other man-made structures at sea or aircraft [or] any deliberate disposal at sea of ships, other man-made structures at sea or aircraft”.

Article 2(4)(a) Helsinki Convention.

None of the exemptions from the dumping prohibition relate to the sub-seabed storage of CO₂. No amendment to the Convention has been made that corresponds to those made in the London Protocol and OSPAR Convention exempting CO₂ from dumping prohibitions. This means that CO₂ storage in the Baltic Sea is still prohibited under the Helsinki Convention.

When the EU is party to an international treaty, the treaty becomes higher in the norm hierarchy than secondary EU Law such as directives. The EU Member States have a responsibility under EU primary law in accordance with the principle of sincere cooperation

See article 4(3) TEU.

to, inter alia, facilitate the achievement of the Union's task. In doctrine, the conclusion has been drawn that the aforementioned is an indication that the EU Member States party to the Helsinki Convention shall work toward the exemption of CO₂ from the dumping prohibition in the Convention.

SOU 2020:4 s. 455 f.

It should however be mentioned that the CCS Directive does not obligate EU Member States to allow storage of CO₂ within their territory. Therefore, it could be argued that it is not the Union’s task to facilitate storage to all ends.

The CCS Directive is an EU directive establishing a legal framework for the environmentally safe geological storage of CO₂

According to the definition in article 3(1)(1) of the CCS Directive the geological storage of CO2 “means injection accompanied by storage of CO₂ streams in underground geological formations”.

to contribute to the fight against climate change.

Article 1(1) CCS Directive.

The Directive should not apply to projects with a total intended storage below 100 kilotonnes, undertaken for research, development or testing of new products and processes.

Recital 18 CCS Directive.

According to the Directive, the purpose of environmentally safe geological storage of CO₂ is permanent containment of CO₂ in such a way as to prevent and, where this is not possible, eliminate as far as possible negative effects and any risk to the environment and human health.

Article 1(2) CCS Directive.

It also contains provisions on the capture and transport components of CCS, though these activities are covered mainly by existing EU environmental legislation, such as the Environmental Impact Assessment (EIA) Directive

https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A32014L0052.

or the Industrial Emissions Directive

https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32010L0075.

, in conjunction with amendments introduced by the CCS Directive. The CCS Directive is not directly applicable in the EU Member States and has to be implemented in the national legislation as it is a directive. Directives are binding on the Member States, as to the result to be achieved, but national authorities are left with the choice of form and methods.

Article 288 Treaty of the Functioning of the European Union (TFEU).

The CCS Directive was to be implemented before June 2011.

Article 39 CCS Directive.

The Directive is divided into eight chapters as follows: chapter one (article 1–3) sets out the subject matter, scope and definitions of the Directive; chapter two (articles 4–5) regards selection of storage sites and exploration permits; chapter three (articles 6–11) regards storage permits; chapter four (articles 12–20) regards operation, closure and post-closure obligations; chapter five (articles 21–22) regards third-party access; chapter 6 (articles 23–30) sets out general provisions; chapter seven (articles 31–37) consists of amendments to other directives; and chapter eight (articles 38–41) sets out final provisions.

The Directive builds largely on the Member States establishing or designating a so-called competent authority or authorities to be responsible for fulfilling the duties established under the Directive.

Article 39 CCS Directive.

Article 4 regards the selection of storage sites.

According to the definition in article 3(3) of the CCS Directive a storage site “means a defined volume area within a geological formation used for the geological storage of CO₂ and associated surface and injection facilities”.

Member States retain the right to determine in which areas within their territory storage sites may be selected, including the right not to allow any storage sites within their territory.

Article 4(1) CCS Directive.

If a Member States allows such storage, it shall undertake an assessment of the storage capacity available in parts or in the whole of the territory, including by allowing exploration through exploration permits.

Article 4(2) CCS Directive. According to the definition in article 3(9) of the CCS Directive an ‘exploration permit “means a written and reasoned decision authorising exploration and specifying the conditions under which it may take place, issued by the competent authority pursuant to the requirements of this Directive”.

The suitability of a potential storage site is to be assessed through a characterisation and assessment of the area as provided for in Annex I to the Directive.

Article 4(3) CCS Directive.

A storage site shall have no significant risk of leakage, and no significant environmental or health risks shall exist.

Article 4(4) CCS Directive.

In the Directive, significant risk is defined as “a combination of a probability of occurrence of damage and a magnitude of damage that cannot be disregarded without calling into question the purpose of this Directive for the storage site concerned”.

Article 3(18) CCS Directive.

If exploration is determined to be required by Member States to gain necessary information for the selection of storage sites, they must make sure that no exploration takes places without an exploration permit.

Article 5(1) CCS Directive.

All storage sites shall be operated with a storage permit, with only one operator being allowed to use each storage site.

Article 6(1) CCS Directive.

Which information that shall be included at a minimum in an application for such a permit is laid out in the Directive, including plans for monitoring, corrective measures, post-closure and proof of financial security.

Article 7 CCS Directive.

The minimal requirement of information to be contained in a storage permit is also set out in the Directive.

Article 9 CCS Directive.

Under the CCS Directive, only storage facilities in the EEA can obtain a permit.

The acceptance criteria for CO₂ streams are set out in the Directive.

Article 12 CCS Directive.

CO₂ streams are defined in the CCS Directive as “a flow of substances that results from CO₂ capture processes”.

Article 3(1)(13) CCS Directive.

The stream is to consist overwhelmingly of CO₂, which reflects the wording in the London Protocol.

Article 12(1) CCS Directive.

This entails that no waste or other matter can be added for the purpose of disposal.

Article 12(1) CCS Directive.

Incidental associated substances from the source, capture or injection process as well as trace substances added to monitor migration after injection are however permitted. These shall be below concentration levels that would adversely affect the integrity of the storage site or the relevant transport infrastructure; pose a significant risk to the environment or human health; or breach the requirements of applicable EU legislation.

Article 12(1) CCS Directive.

For all incineration plants with installed electrical power at least 300 megawatts (MW), where the competent authority determines that it is technically and economically feasible to carry out the capture and compression of CO₂, conditions shall be stipulated in the permit to ensure that sufficient space is allocated at the plant for the necessary retrofitting of equipment for this.

Article 33 CCS Directive & article 36 Directive 2010/75/EU of the European Parliament and of the Council of 24 November 2010 on industrial emissions (integrated pollution prevention and control) (OJ L 334 17.12.2010, p. 17) replacing article 9(1) Directive 2001/80/EC of the European Parliament and of the Council of 23 October 2001 on the limitation of emissions of certain pollutants into the air from large combustion plants (OJ L 309, 27.11.2001, p. 1-21).

In other words these plants are to be built CO₂ “capture ready”.

Member States are to ensure that the operator monitors both injection facilities, the storage complex and, where appropriate the surrounding environment.

Article 13 CCS Directive.

The purpose of the monitoring includes detecting leakage, migration, significant irregularities, and adverse effects on the surrounding environment. The monitoring shall be grounded on the monitoring plan, mentioned above, and be updated every five years.

Article 13(2) CCS Directive.

The Directive also sets out that the Member State shall determine reporting requirements for the operator.

Article 14 CCS Directive.

Also, Member States shall ensure that the competent authorities follow out inspections.

Article 15 CCS Directive.

In the case of a leakage or a significant irregularity, the Member State is to ensure that the operator immediately notifies the competent authority and take corrective matters. If there is a risk of leakage, the competent authority under the ETS Directive is to be notified.

When a storage site has been closed due to relevant conditions stated in the permit being met or to the request of the operator and after authorisation of the competent authority a transfer of responsibility is to take place from the operator to the competent authority under certain conditions.

Article 17(1)(a)-(b) & article 18(1).

These conditions include that all available evidence indicates that the stored CO₂ will be contained, completely and permanently, that the operator lives up to certain financial obligations towards the authority and that the site has been sealed and the injection facilities have been removed.

Article 18(1).

The Commission has adopted a Guidance Document on Criteria for Transfer of Responsibility to the Competent Authority, which aims to assist implementation of the CCS Directive.

EU Commission, Implementation of Directive 2009/31/EC on the Geological Storage of Carbon Dioxide, Guidance Document 3, Criteria for Transfer of Responsibility to the Competent Authority, 2011. Available: https://ec.europa.eu/clima/system/files/2016-11/gd3_en.pdf (last viewed 2022-08-31).

The Directive regulates third party access to transportation networks and storage sites. Member States are to take the necessary measures to ensure that potential users can obtain access to transport networks and to storage sites for the purpose of geological storage of the produced and captured CO₂. A transport network is the network of pipelines, including associated booster stations, for the transport of CO₂ to the storage site.

Article 3(1)(22) Directive 2009/31/EC.

In the future several EU Member States may cooperate in developing cross-border transport and storage infrastructure according to the CCS Directive's Article 24 (for example through joint ownership). It was expressed in stakeholder interviews that it would be beneficial if there were guidance regarding how the countries' respective goal fulfilment should be weighed against each other in relation to provisions on third party access.

In the case of transboundary transport of CO₂, transboundary storage sites or transboundary storage complexes, the competent authorities of the Member States are to jointly meet the requirements of this Directive and of other relevant EU legislation.

Article 24 CCS Directive.

It is important to note that the CCS Directive does not set out regulation for the intermediate storage of captured CO₂. How these storage sites are to be regulated is up to the Member States but shall, of course, live up to the requirements set out in other EU, national or international law applicable to the Member State. Another aspect that is not regulated in the Directive are permits for CO₂ capturing facilities, apart from the requirements to assess if such facilities can be added to new combustion plants when issuing permits as mentioned above.

Norway and Iceland are European Free Trade Association (EFTA) States and are parties to the European Economic Area Agreement

https://www.efta.int/eea/eea-agreement

(EEA Agreement). They are not members of the EU. The EEA unites EEA EFTA States with the EU Member States by extending the EU internal market.

EFTA. European Economic Area (EEA) / Relations with the EU. https://www.efta.int/eea (last visited 2022-08-16).

EU Acts can become binding on the EEA EFTA States if they are incorporated into the EEA Agreement.

This is done through an annex to the agreement or through the EEA Joint Committees Decisions, see article 7 EEA Agreement.

The CCS Directive was implemented in the EEA in 2012.

https://www.efta.int/eeahttps://www.efta.int/media/documents/legal-texts/eea/other-legal-documents/adopted-joint-committee-decisions/2012%20-%20English/115-2012.pdf

This means that the CCS Directive is to be implemented in Norway and Iceland even though they are not EU Member States.

Article 7(b) EEA Agreement.

The implementation of the CCS directive in the Nordic countries is described in section 3.

The Emissions Trading System Directive (ETS Directive)

Directive 2003/87/EC of the European Parliament and of the Council of 13 October 2003 establishing a scheme for greenhouse gas emission allowance trading within the Community and amending Council Directive 96/61/EC (OJ L 275, 25.10.2003, p. 32–46)

establishes the EU Emissions Trading System (EU ETS).

Article 1 ETS Directive.

The ETS Directive also falls under the EEA Agreement. There are connections between the EU ETS and CCS and their respective directives. In short, the EU ETS creates a system where certain operators must own emission allowances for GHG they produce and emit. Annex I of the ETS Directive sets out which activities that are included in EU ETS and includes both activities such as power generation but also the capturing and transportation by pipeline of CO₂ from installations covered by the Directive and the geological storage of CO₂ in a storage site.

See Annex I of the ETS Directive.

Article 12(3a) of the ETS Directive sets out that an obligation to surrender allowances shall not arise in respect of emissions verified as captured and transported for permanent storage to a facility for which a permit is in force in accordance with the CCS Directive. Since under the CCS Directive, only storage facilities in the EEA can obtain a permit, storage outside the EEA cannot comply with the requirements of Article 12(3a).

The EU ETS may provide economic feasibility for CCS applied to emissions from fossil fuels in the EU provided that the price of emission allowances (called EU Allowance Units, EAUs) is sufficiently high relative to the cost of CCS.

Weber, V. (2021), p. 393 note 87.

The EU ETS is based on allowances rather than credits and thus does not provide incentives for BECCS regardless of the EAU price. Allowing the use of BECCS credits for the purpose of compliance in the EU ETS would require significant revisions not only to the EU ETS, but also to the effort sharing regulation (ESR) and the land use, land use changes, and forestry (LULUCF) Directive.

Rickels, W., et al. (2021). “Integrating carbon dioxide removal into European emissions trading”, Frontiers in climate, 3, 1-10.

Through an Implementing Regulation

Commission Implementing Regulation (EU) 2018/2066 of 19 December 2018 on the monitoring and reporting of greenhouse gas emissions pursuant to Directive 2003/87/EC of the European Parliament and of the Council and amending Commission Regulation (EU) No 601/2012 (EUT L 334, 31.12.2018, s. 1–93) (Monitoring Regulation).

(Monitoring Regulation), the Commission has set out rules for the monitoring and reporting of GHG emissions and activity data pursuant to the ETS Directive.

Article 1 Monitoring Regulation.

According to article 49 of the Monitoring Regulation, CO₂ originating from fossil CO₂ in activities covered by the ETS Directive that is not emitted from the installation but instead transferred to a capture installation, a transport network or a storage site is to be subtracted from the emissions of the installation.

Article 49(1)(a) Monitoring Regulation.

A “transportation network” is defined in the Monitoring Regulation as it is in the CCS Directive, namely as “the network of pipelines, including associated booster stations, for the transport of CO₂ to the storage site”. This clearly does not include transportation by shipping. The consequence is that CO₂ that is captured and transported through shipping is not eligible to be subtracted from the emissions of the installation. This is of particular significance in a Nordic context as according to current plans, a significant part of the transportation of captured CO₂ will be through shipping.

As part of the ongoing revision of the ETS Directive, however, the Commission has proposed to extend the provision for transport of CO₂ for geological storage “by pipelines” to all means of transport.

https://climate.ec.europa.eu/document/dfbbc90c-071e-4088-ada2-7af467084b30_en

It is however not until CO2 has been transferred from other means of transport to a transportation network that is fixed to a storage site that the capturing installation can subtract the CO₂. Furthermore, a paper from the Commission published in 2022 states that “for concrete cases, the Commission, already today applies a broad interpretation so that the transfer of captured CO₂ to a ship or a truck does not prevent the right to subtract the CO₂ when it is later on transferred from the ship or the truck to a pipeline transport network or directly to a storage site. When that later transfer from the ship or truck to the network or storage site is completed, the capturing installation can subtract the CO₂ according to Article 49 (a) (ii) or (iii) of the Monitoring and Reporting Regulation 2018/2066”.

https://climate.ec.europa.eu/document/dfbbc90c-071e-4088-ada2-7af467084b30_en

It is also worth noting that the TEN-E regulation

Regulation (EU) 2022/869 of the European Parliament and of the Council of 30 May 2022 on guidelines for trans-European energy infrastructure, amending Regulations (EC) No 715/2009, (EU) 2019/942 and (EU) 2019/943 and Directives 2009/73/EC and (EU) 2019/944, and repealing Regulation (EU) No 347/2013.

(Annex II) acknowledges ship as one mode of CO₂ transport along with pipeline, barge, truck and train.

In a letter to the Commission, Norway has asked if the transfer of captured CO₂ to a ship or a truck prevents the right to subtract the CO₂ when it is later transferred from the ship or the truck to a pipeline transport network or directly to a storage site. The Commission answered that in view of article 49 of the Monitoring Regulation and the ETS Directive, an operator should be allowed to deduct any CO₂ intended for an offshore storage facility from its emissions, which is consistent with the position presented in the paper from the Commission published in 2022.

Letter from the European Commission, Directorate-General Climate Action, to the Ambassador of Norway to the European Union (Ref. Ares(2020)3943156 – 27/07/2020).

A second question that Norway posed to the Commission in the letter was if CO₂, regardless of fossil or biogenic origin, can be subtracted from the emissions of the installation as long as it does not exceed the installation's total amount of produced fossil CO₂. The Commission answered that that captured CO₂ from biological origin may not be subtracted from the emissions of the installation as there is no legal ground in the ETS Directive to support this. The Commission further states that article 49(1) of the Monitoring Regulation makes it clear that this is not possible “("The operator shall subtract from the emissions of the installation any amount of CO₂ originating from fossil carbon […]")”. The Commission deems however, that other instruments could address the issue of and create incentives for BECCS in a more efficient way.

Letter from the European Commission, Directorate-General Climate Action, to the Ambassador of Norway to the European Union (Ref. Ares(2020)3943156 – 27/07/2020).

In conclusion, as of the wording of the ETS Directive and the Monitoring Regulation captured CO₂ of biogenic origin from one installation cannot be deducted from the CO₂ emissions from the same installation. However, contrary to the direct wording of the ETS Directive and the Monitoring Regulation, captured fossil CO₂ transported by other method than pipeline, such as by ship, intended to be stored in a sub-seabed geological formation, can be deducted from the installations emissions from where it came as soon as it is stored.

Questions have been raised concerning the distribution of risk and liability between parties, e.g., Weber (2020). As noted by Weber, when CO₂ is transported by pipeline, the CO₂ producers’ risk goes, in accordance with the provisions of the ETS Directive and the Monitoring Regulation, to the storage operator as soon as the CO₂ is handed over. However, the current regulation does not provide the same clarity when other modes of transportation are involved. A paper from the Commission published in 2022 clarifies that in order to make the calculation consistent in the case of a “CCS value chain” (i.e. several installations together performing the capture, transport and geological storage of CO₂), the receiving installation has to add that CO₂ to its emissions, before it may again subtract the amount transferred to the next installation or to the storage site.

https://climate.ec.europa.eu/document/dfbbc90c-071e-4088-ada2-7af467084b30_en.

In other words, the liability for emissions caused by the operation of CO₂ capture, transport or storage in the CO₂ value-chain is transferred from one ETS installation to the other, without regard to the EEA country they are located in. Any leakage from storage is thus accounted as an emission by the storage operator, and also reported by the country where the storage site is located, in its national GHG inventory.

https://climate.ec.europa.eu/document/dfbbc90c-071e-4088-ada2-7af467084b30_en.