CO₂ markets and transportation infrastructure – Annex to survey responses
This document is the annex to ZEP’s response to the EU public consultation on a forthcoming legislative initiative on CO₂ markets and transportation infrastructure. It complements the questionnaire with detailed ZEP’s recommendations for the legislative initiative. Drawing on the insights from the industrial carbon management community, the recommendations aim to ensure the CO₂ market enables the timely buildout of the CO2 infrastructure in line with the European Union’s climate goals.
About the annex
The Zero Emissions Platform (ZEP) welcomes the opportunity to provide feedback to the public consultation on the forthcoming EU legislative initiative on the CO₂ markets and CO₂ transport and storage infrastructure.
The upcoming instrument should primarily aim to timely deploy the CO₂ transport and storage infrastructure in line with EU climate objectives, while preserving economic efficiency and effective competition over time. While equally important, these objectives will not always align and should therefore be calibrated to the evolving state of the market, ensuring that regulation remains proportionate as the CO₂ value chain develops.
Therefore, the regulatory framework should be designed as an iterative and adaptive system, capable of evolving in response to changing market maturity, infrastructure availability, and competitive dynamics. When choosing the regulatory approach, we recommend prioritising learning by doing, enabling practical experience from early projects to inform subsequent regulatory intervention, rather than relying on fixed regulatory approaches based on predefined timelines, which risks being overly rigid.
Where markets remain nascent or infrastructure-constrained, regulatory design should prioritise infrastructure rollout, project bankability and investment certainty. Where and when markets become sufficiently developed, liquid, and competitive, regulatory focus should shift towards more stringent competition safeguards, ensuring fair access, preventing foreclosure and supporting long-term efficiency within a market-driven and cost-efficient European CO₂ value chain.
Key recommendations
Against this background, ZEP recommends that the forthcoming framework be anchored in the following design principles:
Anchor the legislative initiative on a dual legal basis under Articles 192 (environment) and 194 TFEU (energy)
The forthcoming European legislative proposal on CO₂ markets and infrastructure should have a dual legal basis, namely energy law under Article 194 TFEU and environmental law under Article 192 TFEU.
Establish a clear governance framework and designation of NRAs
A clear governance structure is needed to ensure consistent implementation across Member States. ZEP recommends that Member States designate competent National Regulatory Authorities (NRAs) by a set deadline (e.g. 2028) with clearly defined responsibilities and powers to oversee CO₂ transport and storage markets.
The choice of TPA regime for pipelines should reflect their economic characteristics and system role of CO₂ pipelines, while avoiding excessive fragmentation across interconnected networks.
The European Commission should therefore assess whether the most robust approach is either:
• a general EU framework of nTPA with strong NRA oversight
• differentiated approach for backbone-type infrastructure and onshore monopolies (rTPA) and nTPA subject to oversight for genuinely project-specific offshore pipelines
In either case, the instrument should ensure predictability through harmonised minimum requirements on transparency, access procedures, information disclosure, tariff principles, and dispute resolution, thereby supporting a coherent EU market while allowing proportionate differentiation where justified.
Use negotiated TPA for CO₂ storage, with regulatory oversight
ZEP recommends negotiated third party access for CO₂ storage, combined with regulatory oversight to prevent discriminatory practices and address potential market power concerns as the market evolves.
Avoid unbundling requirements in early phases, combined with NRA oversight and an EU reassessment clause
In the early stages of market development, mandatory unbundling could increase costs and undermine investment incentives. This recommendation supports allowing integrated business models initially combined with NRA oversight to address competition concerns. We also recommend including an EU-level review clause to reassess the need for unbundling measures in e.g. 2035 as markets mature.
Ensure tariff transparency and non-discriminatory access
To support market formation, reduce contractual uncertainty, and mitigate price volatility, robust transparency requirements should apply to CO₂ transport and storage from the outset. Transport and storage operators should publish indicative tariff ranges and standard access conditions – irrespective of the TPA regime applicable – in a way that enables potential users to assess likely access costs and compare offers across providers.
Adopt a multimodal framework for CO₂ transport
The upcoming framework should establish a comprehensive, multi-modal definition of “CO₂ transport” that encompasses pipelines as well as shipping, rail, and road transport. The definition should also include all functionally linked infrastructure and services necessary for an integrated transport chain, such as CO₂ conditioning and liquefaction, intermediate storage, compression and pumping facilities, transhipment operations, and loading/unloading terminals.
Introduce a CCS Availability Guarantee Mechanism to support early movers
ZEP recommends establishing an EU-level, targeted and time-limited CCS Availability Guarantee Mechanism (e.g., under the forthcoming Industrial Decarbonisation Bank) to address low-probability, high-impact CO₂ network disruption risks where transport or storage is temporarily unavailable despite compliant behaviour.