September 25, 2023

Who pays for net zero?

Holding the oil and gas sector accountable in the EU’s Net Zero Industry Act

As the climate crisis escalates, the EU Net Zero Industry Act (NZIA) offers momentum to accelerate EU climate action and foster the deployment of critical net zero technologies to reach climate neutrality by 2050. The NZIA includes some key provisions for the development of CO2 storage sites across Europe, the lack of which represents one of the main bottlenecks for the scale up of carbon management technologies (including CDR).

Article 18 of the proposal in particular has the potential to set a paradigm-shifting precedent that holds oil and gas producers accountable for contributing to “cleaning up” the pollution caused by their products.

In collaboration with the Carbon Balance Initiative, we assess the CO2 storage provisions of the NZIA and voice our support for increasing the accountability of oil and gas producers. In doing so, we propose ten concrete policy recommendations to inspire EU policymakers to strengthen the regulation and ensure that the Union creates a sound and ambitious framework to support the development of CO2 storage as a necessary step to its (durable) net zero goals.

The final text of the NZIA is yet to be defined, with the European Parliament and the Council expected to adopt their positions by the end of 2023 and begin negotiations thereafter. Learn more on the NZIA here