Carbon Capture and Storage
According to its title, Directive 2009/31/EC deals with the geological storage of carbon dioxide.    However, geological storage of carbon dioxide forms part of the broader concept of carbon capture and storage (CCS). Briefly put, CCS is a collective name for a number of, partly alternative, techniques and methods which, when combined, allow carbon dioxide to be sequestered and thus prevented from reaching the atmosphere. Technically, it comprises three main stages: capturing the carbon dioxide (pre- or post-combustion), transporting it to a suitable storage site, and final storage/disposal. The Commission held in 2008 that a 50 per cent reduction of the EU’s emissions of carbon dioxide or those of the world as a whole by 2050 will not be possible without the use of CCS.81 CCS has also prompted considerable legislative activity at the international law level, primarily intended to incentivise CCS activities and enable them to be carried out in a safe manner consistent with international environmental regimes.82
The ‘CCS Directive’, which is based on the predecessor ofArticle 192 TFEU, establishes a legal framework for the environmentally safe geological storage of carbon dioxide to contribute to the fight against climate change. But it also, primarily by amending relevant provisions of other EU legal acts, deals with the other elements of CCS, that is, capture and transport of carbon dioxide intended for geological storage.83 In order to incentivise CCS, such activities have also been included in the EU ETS by amendments to Directive 2003/87/EC.
The CCS Directive applies to geological storage of carbon dioxide in the territory of the Member States, in their exclusive economic zones, and on their continental shelves and prohibits storage outside these areas. However, storage activities with a total intended storage below 100 kilotonnes, undertaken for research, development, or testing of new products and processes, are exempted from the Directive. The storage of carbon dioxide in the water column, that is, in the sea itself, is prohibited. (Art 2.)
It is for each Member State to decide whether it will allow geological storage of carbon dioxide within its territory and if so to determine the areas from which storage sites may be selected pursuant to the requirements of the Directive. Any Member State which intends to allow geological storage shall undertake an assessment of the storage capacity available in parts or in the whole of its territory. The suitability of any specific geological formation for use as a storage site is to be determined pursuant to criteria set out in Annex I.
The identification of suitable storage sites by means of activities intruding into the subsurface such as drilling must only be allowed with an exploration permit. The actual storage of carbon dioxide in such a storage site also requires a permit from a competent national authority. Procedures for the granting of storage permits must be open to all entities possessing the necessary capacities and the permits are to be granted on the basis of objective and transparent criteria. A particular geological formation may only be selected as a storage site, and thus a permit granted, if under the proposed conditions of use there is no significant risk of leakage, and if no significant environmental or health risks exist.84 (Art 4.)
Member States must make available to the Commission permit applications, draft storage permits, and any other material taken into consideration for the adoption of the draft decision. Within four months after receipt of a draft storage permit, the Commission may issue a non-binding opinion on it. If the national authority departs from the Commission’s opinion it must state its reasons. (Art 10.)
Directive 85/337/EEC on the assessment of the effects of certain public and private projects on the environment (subsequently superseded by Directive 2011/92/EU with the same name) to make these legal acts apply to and enable the deployment of environmentally safe CCS activities.
84 A ‘significant risk’ is defined, in Art 3(18), as ‘a combination of a probability of occurrence of damage and a magnitude of damage that cannot be disregarded without calling into question the purpose of [the] Directive for the storage site concerned’. Whereas the purpose of the Directive is not set out explicitly, it ‘establishes a legal framework for the environmentally safe geological storage of carbon dioxide (CO2) to contribute to the fight against climate change’ (Art 1 (1)). The purpose of ‘environmentally safe geological storage of CO2’ is defined as ‘permanent containment of CO2 in such a way as to prevent and, where this is not possible, eliminate as far as possible negative effects and any risk to the environment and human health’ (Art 1 (2)). Hence, the purpose of the Directive must be assumed to be at least that. Accordingly, a ‘significant risk’ should be at least a combination of a probability of occurrence of damage and a magnitude of damage that cannot be disregarded without calling into question the ability of permanent containment of CO2 (at a specific site) to prevent and, where this is not possible, eliminate as far as possible negative effects and any risk to the environment and human health. Reasonably, it is a tall order to establish, for example, when a risk calls into question the ability to eliminate as far as possible negative effects and any risk which may not be prevented. Not least since the definition appears to be based on circular reasoning.
A storage permit may be issued only if the competent authority is satisfied that all requirements of relevant EU legislation are met and that the operator is financially sound and technically competent and reliable to operate and control the site. A financial security or an equivalent shall also be presented by the potential operator in order to ensure that all obligations arising under the permit can be met. (Arts 8 and 19.)
The Directive contains rules on monitoring, based on an approved monitoring plan, for the detection of migration or leakage of carbon dioxide or any significant adverse effects for the surrounding environment, as well as on measures taken to correct significant irregularities or to close leakages, in accordance with an approved plan (Arts 13 and 16).
When injection of carbon dioxide has ceased and the storage site has been closed, which normally requires that all relevant conditions stated in the permit have been met, the responsibility for monitoring, reporting, and taking corrective measures, and for all obligations relating to the surrender of emission allowances in case of leakages and taking preventive and remedial actions pursuant to the directive on environmental liability (Directive 2004/35/EC), may be transferred from the operator to the Member State. Transfer requires that all available evidence indicates that the stored carbon dioxide will be completely and permanently contained and normally also that a minimum period of at least twenty years has elapsed. Before any transfer may occur, the operator must also make a financial contribution available to the competent authority to cover at least the anticipated cost of monitoring for a period of thirty years. (Arts 17, 18, and 20.)
As mentioned previously, CCS activities have been made subject to the EU ETS. This means that capture of greenhouse gases and transport of such gases by pipeline for geological storage, as well as the storage of greenhouse gases in storage sites permitted under the CCS Directive, require a permit and that the operators must surrender allowances to cover any leakage of carbon dioxide. It also means that no allowances must be surrendered in respect of emissions verified as captured and transported for permanent storage in accordance with the CCS Directive. A large number of allowances in the new entrants’ reserve have also been made available to help stimulate the construction and operation of commercial demonstration projects for environmentally safe CCS. (Directive 2003/ 87/EC, Arts 2 and 12.)
Other measures have also been taken to financially stimulate development of large-scale CCS projects. However, CCS has not yet taken off in Europe, partly due to the surplus of allowances in the EU ETS and the attendant low cost imposed on emissions. Cost estimates of CCS vary depending on fuel, technology, and so on, but most calculations fall in the range of €30 to €100 per tonne of CO2 stored.85 That no storage by commercial actors will come about as long as the cost for emitting a tonne of carbon dioxide is €5—10 is rather obvious, and the CCS policy of the EU must be described as being in a state of crisis.