CO₂ Storage: Law Creates Urgently Needed Framework for Market Ramp-Up

With today’s conclusion of the industry consultation on the amendment to the Carbon Dioxide Storage Act (KSpG), the political shaping of a CO₂ market in Germany is moving a decisive step closer. In its statement, the association Die Gas- und Wasserstoffwirtschaft (the german gas and hydrogen industriy) welcomes the draft law as an important contribution to climate protection and industrial transformation. However, the sector sees a need for improvement in key areas. CO₂ storage and the ramp-up of hydrogen must be considered together, as both technologies are indispensable for a secure, affordable, and climate-neutral energy supply.

The development of CO₂ infrastructure in Germany is gaining momentum: The draft amendment to the Carbon Dioxide Storage Act (KSpG) creates, for the first time, a legal framework for the transport and geological storage of CO₂. The association “Die Gas- und Wasserstoffwirtschaft” has actively contributed its position to the process in the consultation ending today and sees it as a fundamental step forward for building a CO₂ market in Germany. “Carbon Capture and Storage (CCS) is a necessary climate protection instrument that enables the transformation of emission-intensive sectors. The 6th IPCC Assessment Report also confirms the necessity of CCS for all realistic climate pathways,” emphasizes Dr Timm Kehler, CEO of the association. “Our industry can and wants to contribute its decades of experience in transport, trading, and safe infrastructure planning. We invite policymakers to actively make use of this expertise.”

The Deutsche Carbon Management Initiative (German Carbon Management Initiative), initiated by Die Gas- und Wasserstoffwirtschaft, has also submitted its own statement. Both positions are clear: CO₂ storage and the hydrogen ramp-up must not be played off against each other. Kehler: “Both technologies are complementary and belong together as part of the energy transition. They must be further developed hand in hand. The hydrogen ramp-up must not be jeopardized by unnecessary conflicts.”

From the association’s point of view, new gas-fired power plants for public electricity supply should be designed to be H₂-ready – at the same time, carbon capture must remain possible at gas power plants, especially to enable industrial power plant sites to use hydrogen and CCS flexibly. “This means that CCU/S is much more than just a technical climate protection instrument: it is an effective industrial policy tool that enables companies to shape their transformation processes independently and economically,” Kehler adds.

Die Gas- und Wasserstoffwirtschaft also sees further need for action: The sector calls for a viable investment framework for CO₂ pipelines, storage facilities, and terminals, particularly in the initial phase. As a necessary first step, Germany must also swiftly ratify the 2009 London Protocol to legally enable CO₂ transport and offshore storage.

“There are still open questions, especially regarding international cooperation, the market framework for CO₂, and infrastructure financing,” Kehler explains. These should be clarified quickly in a stakeholder process.