Keywords: climate change, emissions trading, carbon capture, carbon transport, carbon storage, environ mental liability
Carbon capture and storage (CCS) is a controversial response to climate change, described variously as a 'magic bullet';1 'an uncomfortable but necessary option';2 'an expensive distraction';3 and a 'false hope'.4 The Directive on the geological storage of carbon dioxide (CO2)5 provides a legal framework for the regulation of CCS. CCS is the process of removing CO? from the emissions of industrial processes, injecting and storing it permanently underground, where it is prevented from entering into the atmosphere and thus contributing to climate change. While the climate change imperative seems to have provided significant impetus for expedited negotiation and adoption of the Directive,6 CCS technology is of course as much about energy security and the continued use of fossil fuels.7 In response to policy options which would favour enhanced investment in renewables and energyefficie ncy over the continued use of coal, the Directive notably describes CCS as 'a bridging technology' which 'should not serve as an incentive to increase the share of fossil fuel power plants'.8
The Directive does not make CCS mandatory for new or existing fossil fuel power stations, which in view of the technology's infancy was thought premature.9 Efforts have been made, however, to incentivise and provide investment in CCS via the EU Emissions Trading Scheme (ETS), which from 2013 will not require the surrender of allowances in respect of CO2 verified as captured and transported for permanent storage to a facility with a storage permit.10 There is to be no free allocation of allowances to CCS operators,' though allowances from the New Entrants Reserve will be made available to support CCS demonstration plants.12 Additionally, Member States will be permitted to use funds from auction revenues to support CCS projects.13
The CCS Directive applies only to the storage of CO2 in geological formations14 within the territory of Member States, their exclusive economic zones and on their continental shelves.15 This envisages CO2 storage both on and offshore. The underpinning aim of the Directive is the 'environmentally safe' storage of CO2, meaning the 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'.16 Such risks stem from the fact that CO2 is corrosive and an asphyxiant which is also denser than oxygen, potentially fatal for humans, animals, biodiversity and marine life. Atmospheric release can be damaging to the surrounding environment and leakage into water can cause acidification and contamination.17
The Directive focuses on addressing the storage of CO2, opting to regulate capture and transport within existing regimes. Uncertainty as to the legality of CCS posed by existing EC legislation concerning water and waste is clarified.18 This note will provide a brief overview of the Directive and outline some of the key difficulties in the approach it adopts, starting with capture and transport before turning to storage.