Decarbonisation Technology - February 2025 Issue

Use the 'polluter pays' principle for GHG gas emissions with meaningful minimum costs (such as CO₂ €150 to €200 per tonne and others based on CO₂ equivalence). This will: u Incentivise sequestration of CO₂ that is already captured from natural gas processing, ammonia and ethylene oxide production, and coal-to-chemicals.  Incentivise capture of CO₂ from high partial-pressure process streams on SMRs.  Eliminate the need for a threshold approach to CO₂ intensity with an arbitrary cut-off point for ‘blue’ hydrogen. The 'polluter pays' principle would, in effect, implement a sliding scale of embedded CO₂ and tax or incentivise based on that. Broaden policy acceptance and viability of EOR and EGR as valid mechanisms for CO₂ sequestration. Commit to building common CO₂ pipeline infrastructure to link fossil, geogenic, and biogenic CO₂ emitters with CO₂ storage/utilisation/removals locations. Commit to building a colour-agnostic, common hydrogen pipeline infrastructure with underground hydrogen storage in salt or rock caverns. Support projects that build the bankability of green hydrogen to allow a progressive ramp-up of green hydrogen as renewable power ramps up to support it. Policy priorities for hydrogen and CO 2 management in the second half of this decade

Table 1

A fair assessment of CCS, EOR, and EGR Despite some failures, disappointments, and poor reporting in certain carbon capture and geological storage (CCS) projects, there have also been many successes. The way to get better is to do more and learn faster. Enhanced oil recovery (EOR) and enhanced gas recovery (EGR) should also be seen as meaningful ways to store CO₂ in suitable geological formations. Dismissal of EOR and EGR as valid CCS mechanisms due to concerns that they may increase fossil fuel production is not valid on a global scale. There is an abundance of crude oil and natural gas reserves in the Middle East and Russia; these nations will produce according to demand. To say that EOR or EGR stimulate demand for fossil fuels is a flawed argument. Local production avoids the cost and environmental impact of fuels distribution. Extending the life of wells can increase economic efficiency. Policymakers must take a more supportive view of EOR and EGR as valid means of CO₂ sequestration. Also, when we consider the number of successful EOR schemes, underground geological storage of CO₂ has an overwhelmingly positive history. Greenhouse gas emissions are the problem Excessive CO₂ in the atmosphere is the problem now and will remain a risk for eternity. We must

address the problem rather than favour one solution ahead of others. To do that is a risky guessing game that no policymaker can afford to make. In many areas, policy is no longer technology agnostic – it should return more closely to that principle. Now more than ever, a focus on CO₂ emissions reduction and carbon dioxide removals (CDR), by whatever means, must be priorities. The costs of GHG emissions, whether they be CO₂, methane, F-gases, or others, must be paid by the polluter. Taxation of the polluter pays principle has driven the reduction of NOx and SOx emissions in several countries in northern Europe. At present, CO₂ emissions are too cheap. The tax penalties or incentives for GHG emissions reduction are too weak. The cost of CO₂ emissions should be in the order of €150 to €200 per tonne (see Table 1 ). Methane, F-gases and nitrous oxide must be scaled in line with their CO₂ equivalence. Any concerns about unfair competition due to policies moving at different speeds around the world can be met with embedded CO₂ cross-border tax adjustments. The EU ETS, US 45Q, and other ‘carrot or stick’ schemes around the world must set a cost to CO₂ emissions, ensuring there is a business case for decarbonisation investments. Even if there is a degree of GHG emissions cost fluctuation,