European Commission limits CDR procurement to large-scale industrial BioCCS and DACCS

The European Commission has proposed a regulatory framework to allocate revenues from 250 million EU ETS allowances between 2031 and 2040 for permanent carbon dioxide removal (CDR) procurement. This framework restricts initial technology eligibility to Bioenergy with Carbon Capture and Storage (BioCCS) and Direct Air Carbon Capture and Storage (DACCS), excluding biochar and other decentralised carbon removal pathways. The policy prioritises industrial point-source capture and geological storage, creating a centralised procurement market. Industry experts estimate current European BioCCS deployment costs at €300-€400 per tonne, posing potential financial risks against assumed procurement price targets. This approach focuses on large-scale industrial clusters near geological storage hubs, limiting direct participation for agricultural enterprises and decentralised pyrolysis operators.

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