ICAP Emissions Trading and Carbon Capture and Storage: Mapping possible interactions, technical considerations, and existing provisions

Carbon Capture and Storage (CCS) can be a key tool in the response to climate change. CCS applications can support decarbonization by helping to reduce emissions from emissions-intensive industries and through the retrofitting of existing infrastructure. Moreover, some CCS applications can reduce atmospheric concentrations of carbon dioxide and are an important component in compensating for residual emissions and achieving net zero by mid-century.

Most jurisdictions with Emissions Trading Systems (ETSs) in force either already have policies on CCS or intend to make use of CCS applications. Moreover, there is an important overlap between the sectors covered by ETSs and those in which CCS shows the most promise. At the same time, there has been limited attention to the interactions between ETSs and CCS. This report explores how CCS is treated in different ETSs around the world; if and how ETSs could play a role in incentivizing the development and deployment of CCS applications; and the challenges and opportunities in developing the required regulation in this context.

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