Strategy for biogenic carbon capture
A new industry is currently emerging. Flue gases from biogenic sources are to be captured, for example from the combustion of forest industry residues in heating plants. The carbon dioxide can then be stored in the bedrock, creating negative emissions (BECCS), or turned into new fossil-free products (BECCU). Fossil Free Sweden’s strategy focuses on how Sweden can take a leading role in this development.
To achieve the Paris Agreement, which aims for a maximum temperature increase of 1.5 degrees, the world must return to the same carbon dioxide levels in the atmosphere as in the mid-1980s. It is therefore not enough to drastically cut carbon dioxide emissions; we must start capturing carbon dioxide and storing it permanently in the bedrock (CCS, carbon capture and storage). The captured carbon dioxide can also be converted into fossil-free products such as electrofuels and chemicals (CCU, carbon capture and utilization).
The emerging technology presents great opportunities for Sweden, which has unique conditions to develop carbon dioxide capture from biogenic sources. The pulp and paper industry and the combined heat and power sector are activities with large emissions of biogenic carbon dioxide, where the technology can be used.
“The smoke from our large chimneys is a completely untapped resource today, which is on its way to becoming the foundation of a new Swedish export industry. It’s an exciting realization that we may not see any flue gases from these chimneys in the future,” says Svante Axelsson, national coordinator, Fossil Free Sweden.
The purpose of Fossil Free Sweden’s sixth strategy for fossil-free competitiveness is to show how Sweden can gradually reduce the carbon dioxide content in the atmosphere, take a leading role within the EU, and develop a new export industry for both BECCS and BECCU. The strategy has been developed in collaboration with companies and academia to enable technological development and facilitate the implementation of the 22 roadmaps for fossil-free competitiveness that the business sector has developed within the framework of Fossil Free Sweden.
Carbon dioxide capture should not replace emission reductions
Negative emissions will be needed partly for companies and countries to reach their net-zero emission targets, but it is also important that carbon dioxide capture only compensates for emissions that are very difficult and expensive to reduce, so-called residual emissions. In the long term, negative emissions are also needed to reverse the trend to reach mid-1980’s carbon dioxide levels. It is therefore important not to “waste” this potential just to reach net-zero.
It is also important that biodiversity is valued all the way from production to end-use. Sustainable bio-raw materials are a limited resource and need to contribute to the climate transition in an energy- and resource-efficient way.
Prioritized proposals to the government
Sustainable carbon-based products created through CCU can substitute fossil products and thereby contribute to emission reductions. Upcoming policy instruments within the EU will, in the long term, create significant demand for electrofuels in the aviation and maritime sectors. To strengthen Sweden’s competitiveness and support Swedish industry in meeting the upcoming demand, policy instruments are needed to stimulate domestic production of electrofuels. The government should therefore introduce a flexible and long-term policy instrument in the form of a revenue guarantee for domestic production of electrofuels and other renewable fuels.
Industries where biogenic carbon dioxide is used as a raw material for chemicals and materials are currently not covered by any existing policy instruments. To provide clear guidance and incentives for the transition from fossil to recycled and renewable raw materials for chemicals and plastic products, Sweden should take leadership on this issue and introduce targets for recycled and/or renewable raw materials for chemicals and plastic products within the EU. Additionally, Sweden should advocate for a common phase-out year, preferably 2040, for the use of new virgin fossil raw materials.
To increase investment opportunities in CCUS from mixed streams, where emissions from a facility consist of both biogenic and fossil carbon dioxide, the government should work within the framework of the EU ETS Directive, as well as other relevant directives, to allow for the allocation of biogenic and fossil carbon dioxide in mixed streams to different purposes.
Separate targets for emission reductions and carbon storage within the EU clarify that most emission sources and sectors need to reach net-zero emissions by 2050 at the latest, and reduce the risk that negative emissions slow down technological development and efforts to limit fossil emissions. Therefore, in the upcoming work on the EU’s 2040 targets, Sweden should advocate for separate targets for emission reductions and carbon storage, including a specific share of permanent negative emissions.
To realize the potential of BECCS, it is crucial that there is market trust in permanent negative emissions as one of the options to limit global warming. Using negative emissions to compensate for necessary emission reductions that would otherwise need to be made to meet set climate targets could harm the credibility of negative emissions in the market and lead to the climate benefits of negative emissions being questioned. This would hinder the development of a technology necessary to achieve the 1.5-degree target. Therefore, the government should clarify that Sweden will only use permanent negative emissions to compensate for residual emissions in a way that does not slow down the pace of ongoing emission reductions.
Facilities for BECCS are a costly investments that governments will need to help finance in order to scale up and create the necessary infrastructure to make the technology accessible. To leverage public funds and realize as much potential as possible from permanent negative emissions, the upcoming Swedish support system for BECCS should be designed in a way that ensures the share of taxpayer money is minimized when combined with private financing. This also helps ensure that private purchases of permanent negative emissions contribute to additional climate benefits. In the upcoming regulation on government operational support for BECCS, the government should:
- Clarify that the entire intended budget framework should be used to create incentives for the establishment of BECCS and that any refunded funds go back to the budget allocated for BECCS.
- Design the support system so that those who invest in the production of negative emissions can adjust their bids in auctions, taking into account revenues from the voluntary market, and ensure that no adjustments to the support levels are made as a result of private revenues.
- Avoid risks of overcompensation under state aid rules by ensuring that all revenues and costs of the project are reported.
- Introduce a minimum threshold for private financing, preferably at least 50 percent, for the negative emissions co-financed with the voluntary market.
To store or use the captured carbon dioxide, a functioning infrastructure for the transport and storage of carbon dioxide is needed. To facilitate the investments in infrastructure solutions required for scaling up BECCUS, the government should clarify the regulations for green credit guarantees so that they can be used as a way to reduce investment risks in such projects.
Companies and organizations behind the strategy
Stiftelsen Futura Environmental Initiatives