Depending on how it is designed, the Commission’s newly proposed EU Buyers Club initiative for carbon removals may contribute little to the green transition or even set it off course. The CO2ol Down project proposes a workable alternative that develops permanent removals while slashing emissions.

With the European Union’s recently agreed 2040 climate target setting an unambitious course towards decarbonisation, the European Commission’s latest carbon dioxide removals plan will likely only push us further away from this goal. 

In an attempt to incentivise carbon removals and carbon farming in the Union, the Commission has backed a new EU initiative that would revolve around the proposed “EU Buyers’ Club”: coordinating a group of private companies that would voluntarily buy carbon removal and carbon farming credits certified under the Carbon Removals and Carbon Farming (CRCF) Regulation. 

However, this plan is unlikely to serve the EU’s environmental and climate goals. This is because the draft CRCF methodologies being developed by the Commission, which are meant to ensure that sustainable removals or carbon farming actually happened, are currently flawed. Additionally, it risks deterring companies from reducing their avoidable emissions if they could claim that they have bought removals instead.  

This type of private-sector involvement could be problematic if turned into yet another offsetting scheme. The Commission should ensure more financial support to develop sustainable permanent removals and to conserve and restore nature through carbon farming in a way that does not allow companies to compensate for their ongoing emissions.

Fabiola De Simone, Carbon Market Watch’s lead on carbon removals, explains that “in the short term, voluntary initiatives from the private sector are welcome if not used for offsetting or insetting, but the EU should soon move towards legal obligations to procure removals. The involvement of public authorities is crucial to ensure that carbon farming and carbon removal activities contribute to environmental and social wellbeing. The EU needs a proper policy for carbon removals based on the principle of the separation of targets.”

Blueprint for good governance 

The separation in policy between emission reductions, land-based sequestration and permanent removals is the backbone of proper carbon removals policies. This means that these activities should not replace, but rather reinforce each other. Once this principle is established, policies and instruments are needed for each of them.  

This is the idea behind the proposal for an EU permanent carbon dioxide removal development and delivery framework, co-created by academics, civil society and industry representatives in the second phase of CO2ol Down. This framework would ensure dedicated efforts towards the development of sustainable permanent removals, while maintaining emission reductions as the priority. 

The proposal suggests a two-pronged framework for the financing and development of permanent carbon removals in the EU. In the short term, the EU should dedicate some effort to testing, researching, or procuring already available sustainable permanent removals. To do that, funding can come from the EU and member states’ budgets, as well as contributions from private companies. The latter would not be allowed to use these removals to offset their emissions, but would give them the chance to contribute to their country’s climate goal.   

In the long term, the goal would be to create a removals compliance scheme that operates in parallel to and separate from the Emissions Trading System. This scheme would introduce carbon dioxide removal obligations for companies. They would have to buy removals that would contribute to the EU’s implementation of its Paris Agreement climate goals. 

The scheme, managed by the EU, would invest in high-quality, science-based carbon removal projects. Thus, this framework would guarantee a steady, reliable revenue stream for carbon removal efforts and ensure that residual emissions are balanced effectively, successfully reaching the EU’s climate-neutral goal of 2050. 

The CO2ol prototype

The prototype framework was created to serve as a source of inspiration for policymakers. It was launched at an event in December with more than 200 attendees, both online and in person. 

The event featured presentations from De Simone and the University of Oxford’s researcher Alice Evatt, as well as a panel discussion with Fabien Ramos from the European Commission’s Climate Directorate-General, Francesca Battersby of Carbon Gap, Silke Mooldijk of the NewClimate Institute and Atilla Yucel from the Negative Emissions Platform.

The panellists discussed the importance of a dedicated framework like the one devised by the CO2ol down project, as, according to Yucel, “Europe needs a CDR strategy that starts with specific targets like permanent carbon removals… and I think [the CO2ol down] proposal provides very fundamental building blocks for such a strategy.” 

The panellists also discussed the role of public institutions and private companies in incentivising sustainable carbon removals in the EU towards the common goal of carbon neutrality because, as Mooldijk concluded, “CDR should be considered a public good that is needed to limit global warming”. 

The proposal was welcomed by Ramos, the Commission’s representative, as it provides a “look at how EU public money could leverage actions from other actors” to drive investments in carbon removals. It is now up to policymakers to make the best use of this prototype with a forward-looking approach to climate action.