Introduction

Biomass use for energy production in processes such as combustion and gasification, and its use to produce biofuels such as bioethanol, results in CO₂ emissions. If carbon dioxide capture and storage (CCS) is applied to these emissions, because the CO₂ is recently taken-up by the biomass from the atmosphere, then actual CO₂ removal from the atmosphere can take place. This is referred to as ‘negative emissions’. At present there is only one technology which may be able to be deployed at the required scale – biomass with CCS (bio-CCS or BECCS).

There is a need for analysis of the options for correctly accounting, reporting and rewarding all emissions relating to bio-CCS, and of ways of including it in emissions trading schemes (ETS) to appropriately recognise its greenhouse gas (GHG) reduction performance. IEAGHG commissioned this analysis to Carbon Counts Company (UK) Ltd.

Key Messages

• Most schemes at least recognise negative emissions from bio-CCS by either allowing for net-back accounting on a portfolio level (“pooling”) or the generation of credits (“offsetting”).

• Regional cap-and-trade schemes generally do not recognise negative emissions from bio-CCS. However, the architecture of most schemes would allow for either pooling or offsetting if the regulating bodies implement these methods in the schemes.

• Incentivising bio-CCS remains a challenge, due to the baseline of many schemes. Currently, there is a debate about whether bio-CCS delivers a double dividend for emissions abatement and thus should receive double credits.

• Land use change (LUC) is a big concern. Especially in developing countries “carbon leakage” is likely to occur. Some schemes might accelerate forest clearing in these countries. The opposite can happen as well, i.e. generation of more forest plantation due to increased demand. Low carbon fuel standards (LCFSs) include detailed GHG accounting rules for calculating upstream emissions and also consider LUC effects to some extent.

• Regulating bodies in the EU and US are currently discussing how to address the sustainability concerns around bio-CCS, including the parity of treatment between fossil and biogenic CO₂. This broader discussion will likely initiate a complex political process.