In the letter sent to European Commission President Ursula von der Leyen, UK Prime Minister Keir Starmer, and senior EU and UK leaders, the signatories welcome progress towards linking the EU and UK ETS systems, but warn that without urgent steps to coordinate on CCUS, the ambition risks getting stuck in the pipeline.
The signatories call for the immediate creation of a dedicated Working Group on CCUS under the Trade and Cooperation Agreement’s Specialised Committee on Energy. Such a forum would provide structured dialogue on cross-border CO2 transport and storage and regulatory coordination, key elements for ensuring clarity and predictability for industrial actors investing in decarbonisation.
“Establishing a Working Group on CCUS would allow ETS linkage and cross-border CO2 trade discussions to progress in parallel, accelerating the development of cross-border projects,” the letter states. “This will benefit both EU and UK industrial stakeholders by enabling them to decarbonise their activities while staying competitive”.
According to CCSA’s report Accelerating a Europe-wide CO2 storage market, with access to UK CO2 storage sites, EU emitters would also benefit from significant cost savings (on average) up to 28% (€16/t of CO2).
The letter outlines key recommendations for the EU and UK’s preparatory work on ETS linkage, including:
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Ensuring mutual eligibility of emission allowances across both systems and joint oversight of registries and auctions
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Developing compatible market stability mechanisms and aligning phase-out of free allowances
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Recognising CO2 transport and storage under both regulatory regimes, to enable access to UK storage sites and deliver significant cost savings for EU emitters
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Coordinating standards on CO2 specifications, metering, carbon removals integration, and certification methodologies
With both the EU and UK highlighting CCUS as a pillar of their decarbonisation strategies, the signatories stress that now is the opportune moment to act. By confirming the role of CCUS into ETS linkage negotiations, policymakers can accelerate the rollout of crucial CO2 cross-border infrastructure.