Turning decarbonisation options into board-ready decisions A structured technical and economic screening process is vital for translating EU policy drivers into actionable investment choices
Andrew Last, Tracy Sadowski, and Scott Sayles Becht
F or European refiners, the past two direct operating cost. With a total annual emissions tax cost reaching billions of euros ( EEA, 2025 ), emissions have shifted from a compliance item to a material factor in margin resilience and capital planning. The challenge has evolved from identifying decarbonisation options to selecting the right ones. Refiners must evaluate competing technologies, infrastructure requirements, and capital intensity while maintaining operational reliability. A structured technical and economic screening process is essential to translate policy drivers into practical investment decisions. decades have seen decarbonisation move from a policy discussion to an increasing The cost of emissions initially justified energy- efficiency improvements and is now a rising annual cost of tens of millions of euros for refining sites, driving margin and competitiveness decisions, large-scale project spending, and, for some sites, closure ( TCE, 2025 ).
As project announcements have surged, particularly in biofuels and hydrogen, they must now contend with the practicalities of execution. The next phase will depend less on headline ambition and more on disciplined assessment of technology, configuration, and delivery risk. The region’s refiners face the challenge of selecting and implementing the right decarbonisation projects for their site’s realities and market position to avoid eroding competitiveness or committing capital to the wrong long-term configuration. Confidence in decarbonisation technology claims can outpace practical readiness; an independent third-party assessment can provide a structured counterweight. By evaluating technical feasibility, integration risk, Capex intensity, and schedule realism during scenario screening, a broad technology debate can be converted into a board-ready decision framework.
European refinery decarbonisation drivers Using the European Union’s Emission Trading Scheme (EU ETS) as an example of a major decarbonisation driver, refineries each have individual emissions allocations, with a cost for any emissions beyond the annual cap. As the free allocation for each refinery has
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Figure 1 Total EU refinery emissions (2013-2025) (EEA, 2025 )
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