Germany's economy ministry is relaunching the stakeholder process for the country's carbon management strategy, as companies await more clarity on the role of negative emissions and possible carbon storage sites.
The relaunch of the stakeholder process for Germany's carbon management strategy — renamed the "carbon management action plan" to reflect the change in government — is "imminent", the federal ministry of economic affairs and industry said today, although it would not give a timeline.
Stakeholders have been asked to draw up proposals to policymakers by the summer break. A draft carbon management strategy is then expected to be presented in the autumn.
While the government's carbon management action plan is important, the really crucial decisions concern the future inclusion of negative emissions in the EU emissions trading system (ETS) and will be made at European level, Germany's Carbon Management Alliance (CMA), which represents industrial companies active in the sector, said. The European Commission will begin its scheduled review of the EU ETS in July.
Excluding negative emissions from the ETS will make business cases for carbon capture, use and storage (CCUS) far more difficult, as will any softening of the ETS price, CMA expert Norman Wendt said.
The announcement last week that Germany will not provide financial support for the development of carbon transport infrastructure to storage sites in the North Sea is probably understandable, Wendt said, as "these are not times for government spending on large infrastructure projects".
But the government nonetheless has a role to play in setting the right incentives for private investments, Wendt said, including through derisking instruments and equity participation models. It will also need to ensure "targeted" and "co-ordinated" infrastructure planning, bearing in mind potential onshore options, Wendt said.
More concerning is the government's assumption that federal states will allow onshore carbon storage on their territory, towards which none has made any move, Wendt said. If a federal state decides to start the necessary legislation it will likely face public resistance and is likely to take years, Wendt said.
Once onshore carbon storage is permitted in a state, its mining authority would still need to decide on appropriate storage sites, which would take too much time, particularly for industry first movers already planning their CCS activities, Wendt said.
