Europe has no shortage of carbon capture project proposals. What it lacks is bankable deals. And according to a new analysis from the Carbon Capture and Storage Association (CCSA) and Deloitte, that gap could cost the bloc both its climate targets and its industrial base.
The Financing Bottleneck
The European Commission estimates that hundreds of millions of tons of CO₂ will need to be captured annually by mid-century to meet long-term climate goals. Today, Europe’s operational CO₂ storage capacity is marginal. Transport networks and injection sites are lagging far behind policy ambition.
The CCSA/Deloitte report identifies the choke point: commercial structure. Developers aren’t short of project concepts — there are proposals across steel, cement, chemicals, and waste-to-energy. But three structural problems are freezing capital:
- Fragmented national regulations that vary wildly between member states
- Unclear allocation of long-term storage liability — who’s responsible if something goes wrong in 50 years?
- Slow permitting for shared infrastructure — the CO₂ pipelines and terminals that multiple projects need
The result: investors with capital ready to deploy are sitting on the sidelines.
The Competitive Threat Is Real
This isn’t just a climate problem — it’s an industrial competitiveness problem. UK developers have already warned publicly that they’ll redirect CCUS investment abroad if policy uncertainty continues. The same dynamic could play out within the EU, especially now that the 2040 emissions target is locked into law, compressing delivery timelines.
If cement plants in Poland or steel mills in Germany can’t access CCUS infrastructure at competitive costs, they face a choice between paying escalating carbon prices under the ETS or relocating to jurisdictions where decarbonization pathways are clearer and cheaper.
What the Report Recommends
The authors propose “no-regret” actions in phases: de-risk early projects now while building toward a self-sustaining market. The endgame is industrial hubs connected by cross-border CO₂ corridors, with demand-side incentives eventually replacing subsidies.
The critical point: CCUS must be treated as a single system. Capture without transport is useless. Transport without storage is pointless. Weakness in any link undermines the entire investment case.
The Net Zero Industry Act set near-term CO₂ storage targets for 2030. The window for first-of-a-kind projects to reach final investment decisions is narrowing fast. Without rapid coordination between Brussels and member states, Europe’s CCUS strategy risks becoming a masterclass in ambition outpacing execution.