Europe Builds Industrial-Scale Carbon Capture and Storage Market
Europe is establishing an industrial-scale carbon capture and storage market, driven by projects like Northern Lights and Greensand, targeting heavy industries and net-zero emissions.
Europe is currently laying the foundations for a new commercial carbon capture and storage (CCS) market at an industrial scale. This regulatory-backed and publicly funded initiative aims to deepen emission reduction efforts beyond electrification and efficiency measures, moving toward the net-zero emission target.
Industrial Scaling and Market Maturity
According to Susan Joho, an economist at Julius Baer, infrastructure projects such as Northern Lights and Greensand demonstrate market maturation. For high-emission heavy industries such as cement, steel, and chemicals, investing in carbon capture facilities is becoming economically viable. This momentum is supported by the completion of the European Union carbon trading system via the Carbon Border Adjustment Mechanism (CBAM), which expanded carbon pricing to imported goods.
Two significant milestones were recorded last September: Europe's largest commercial industrial carbon capture facility began operations at a Yara International fertilizer plant, with a capture capacity of up to 800,000 tons of CO2 per year, transported by ship from the Netherlands to Norway for permanent underground storage. Simultaneously, the Greensand network launched with an initial storage capacity of 400,000 tons annually. Both networks provide initial proof that cross-border transport and storage of carbon from commercial clients can operate at scale.
Economic Drivers and Future Challenges
The choice to start with fertilizer plants is deliberate. Ammonia production yields a relatively pure stream of carbon dioxide, allowing for significantly more efficient and cheaper capture compared to other processes. With carbon prices currently exceeding 80 euros per ton, adding capture facilities to fertilizer production becomes profitable.
The primary challenge over the coming decade will be scaling the solution to more complex sectors such as cement and steel. Heidelberg Materials is already among the first Northern Lights subsidy recipients.
Technology costs in these sectors still need to drop from over 500 euros per ton toward 200 euros.
Biogenic Carbon and Negative Emissions
Concurrently, the field of biogenic carbon capture is developing, enabling negative emissions. Swedish energy company Stockholm Exergi is developing a massive project at a biomass-powered plant to transfer carbon to Northern Lights, alongside Danish company Orsted at two of its facilities and the Greensand project.
