Carbon circularity requires EU action: lessons from 3 EU projects [Promoted content]

CO2SMOS, VIVALDI and CATCO2NVERS are EU-funded projects exploring ways to replace fossil-based carbon in chemicals with carbon emitted by installations processing biomass. Their recommendations? EU regulations must ensure that sustainable carbon is recognised as the easier, cheaper and necessary alternative.

The projects CO2SMOS, VIVALDI and CATCO2NVERS have been funded to a total of €20 Million by the European Research and Development Programme Horizon 2020. The projects address the environmental challenge of decreasing the CO2 emissions of bio-based industries by developing innovative Carbon Capture and Utilisation (CCU) solutions to convert CO2 into high-added-value chemicals.

By exploring different solutions and business cases, the three projects are gathering the expertise of international partners representing the entire value chain to transform biorefineries into a new CO2-based industrial sector, contributing to largely decreasing the carbon footprint of the chemical industry and boosting the European Union economy.

Working towards the same goal, the 3 projects collaborate regularly to exchange expertise and tackle common challenges. In a workshop held on the 20th of February 2024, representatives from the projects presented EU policymakers and biochemical industry stakeholders their results and conclusions, together with the challenges they have ascertained during the course of their research:

EU policies must reward better the reuse of captured carbon.

If we are to move away from a fossil-based economy, for example, when producing plastics, we need to take into account not only what happens downstream (recycling, reuse, etc.), but also upstream, and whether fossil resources are used to make products. Reusing captured carbon to make plastics cannot be classified as equivalent to extracting ground oil to manufacture the same product. EU regulations must recognise the value in the reuse of existing carbon. 

EU regulations must be simplified.

If we are to validate new processes and technologies to replace the use of oil and gas to produce chemicals, we need to have clear, safe and swift regulatory approvals of new technologies encouraging fossil-free pathways. 

EU policies must boost demand for sustainable products.

If there are no buyers, there will be no sellers: creating sustainable products and chemicals comes with inherent constraints and costs, but they are worth it. However, renewable chemicals cannot compete with fossil-based equivalents on a purely free-market basis in a paradigm where fossil-based products are the near monopoly: we need to implement market-pull mechanisms for specific products like cosmetics, textiles, packaging, plastics, cleaning products, and more; all of which can be produced from captured carbon.

The mandatory use of at least 5%, 10% or 20% of alternative feedstock to make those products would create a demand for those alternatives, which in turn would drive more innovation, more production, more circularity and more sustainability. This can follow the example of CCU fuels for the aviation sector as witnessed in the recent in ReFuelEU Aviation Regulation.

European institutions, and the European Commission in particular, are starting to acknowledge this challenge, as published in two Communications in February 2024. The EU 2040 climate target highlights the need to be “replacing the fossil carbon currently used as feedstock in various industries with non-fossil carbon”; whilst the Industrial Carbon Management Strategy points out that “the benefits of these CO2 utilisation technologies are not yet fully recognised, nor is their capacity to provide an alternative source of carbon to replace fossil carbon in specific sectors of the EU economy that are carbon-dependent” and that “additional measures are needed to recognise the potential climate benefits of using sustainable carbon from captured CO₂ rather than fossil carbon for other applications”. 

The publication of these documents is a major step forward and sets the right tone and track for the coming years. In this context, the results and conclusions from our 3 projects are clear: the climate transition comes at a cost and requires enabling conditions. Replacing fossil resources is an absolute must, and it needs more support, more funding for innovation and research along the TRL scale, and more market interventions to break the near-monopoly of fossil-based products.

The European Commission estimates in its Industrial Carbon Management Strategy that “the annual carbon demand for the chemical sector alone in Europe is currently estimated around 125 million tonnes, or about 450 million tonnes CO₂ equivalent, more than 90 % of which is supplied with fossil carbon”. Alternative feedstock represents less than 10% of the annual carbon demand for chemicals. Scaling-up the substitution of fossils with CCU products is a significant task. These 3 EU projects can put forward the following recommendations and learnings on the existing challenges of this journey:  

– The sustainable option should be an easy choice, meaning simpler rules and expedited permitting processes

– The sustainable option must be the cheaper alternative, which will mean rewarding producers employing fossil-free carbon

– The sustainable option should be mandatory, meaning creating alternative carbon quotas for everyday products 

European authorities have a unique opportunity to help decrease our dependency on fossil-based resources while maintaining jobs and skills in Europe through the production of CCU chemicals. The work being done in the Transition Pathway for the Chemical Industry is a positive step into the right direction. By fixing the current system, by supporting funding and by creating new rules and incentives, chemical production can be moved away from fossil addiction. 

With the new EU political cycle starting after the EU elections in June 2024, it will be crucial for Europe to translate its intentions laid out in its 2040 climate targets and its Industrial Carbon Management Strategy into reality, and to support projects, companies and organisations trying to scale up the defossilisation of the EU economy.