Blog post: Public action needed to remove entry barriers for Hungarian firstcomers to CCS

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Hanna Biro from Bellona Europa, originally from Hungary, recently traveled to her home country to attend a local workshop which brought together national CSC stakeholders. The workshop aimed to identify the challenges and limitations of CCS deployment in Hungary, as well as ways to overcome them. The workshop was organized within the framework of the CCS4CEE project in which Bellona Europa participates as an expert partner. The brainstorming that took place during the workshop addressed the issues of national legislative barriers, essential regulatory incentives, the need for coordination at the national level, as well as geological capabilities.

In this blog post, Hanna Biro, policy assistant at Bellona Europa, explains that while in many respects Hungary seems ideal for the deployment of CCS, Hungarian stakeholders – eager to take the first step – still face barriers to entry and development in the form of financial risks. and the lack of forums to facilitate coordination. These are obstacles that could be successfully overcome through recognition, action and public support. Financial support for transporting CO2 by rail and road in the short to medium term is considered essential to kick-start the deployment of CCS in Hungary – a country which already has considerable experience with CO2 injection and wishes to adopt mature carbon capture technologies already in common use in other parts of Europe.

As Hungary strives to meet EU emissions reduction targets on its way to climate neutrality by 2050, carbon capture and storage (CCS) technologies – crucial for industrial decarbonisation effective and on a large scale – are seen as part of the solution. 12% of Hungary’s national emissions result from industrial processes and product use, partly due to Hungary’s production of cement, steel and chemicals. These are all economic activities that will benefit from the regional deployment of CCS because the extent to which they can be directly electrified or decarbonized by other means is limited, if not impossible.

This is what national stakeholders came together to discuss at a recent workshop organized within the framework of the CCS4CEE project, in which Bellona Europa participates as an expert partner. While many stakeholders want to take the first step towards realizing the first CCS projects in Hungary, they cite a number of concerns that seem to have delayed the realization of such projects in the past and which, if not addressed , could continue to do so.

Namely, the financial risks that the government seems reluctant to overcome through support, and the lack of forums to facilitate coordination among stakeholders. These large-scale CCS projects often require bilateral and multilateral agreements with neighboring countries, and generally benefit from governments acting as mediators between national and international actors and stakeholders by providing a platform that facilitates discussion and discussion. coordination across the entire CO2 value chain. Financial risks for individual actors should also be mitigated by treating CCS deployment as a common good; it helps manage Hungary’s CO2 waste, helping to put Europe on the path to net zero by 2050.

In many ways, Hungary is ideal for deploying CCS: the country has extensive experience in injecting CO2 into geological formations due to its experience in enhanced oil recovery (EOR). Unlike EOR (injecting CO2 into oilfields to pump more oil out of the ground), CCS provides a real climate benefit by storing CO2 away from the atmosphere without supporting oil extraction. At the same time, Hungary has significant geological potential for CO2 storage, mainly consisting of depleted reservoirs and hydrocarbon deposits.

To start the deployment of the CCS, financial support for the first arrivals is necessary to reduce the risks. Platforms that bring relevant stakeholders together around the same table to facilitate discussions and coordination among them are also needed. According to Hungarian stakeholders, the national government can support the deployment of CCS in several ways: through tax breaks and tax credits, green certification programs or public procurement procedures. In particular, due to the relatively small geographical area of ​​Hungary and the long lead times for CO2 gas pipeline projects, stakeholders highlight the need to support multiple transport modalities, namely road and rail – including the importance was underlined by Bellona in its campaign around the TEN-E and TEN-T regulations.

CCS is not only a key technology to decarbonise the industrial sector in Central and Eastern Europe, but it is also an important just transition tool for the region by ensuring that those working in heavy industries are not forgotten in policies and actions that accelerate the transition to a climate-neutral economy. CCS helps retain jobs and create additional green jobs, in line with the EU’s long-term vision and net zero by 2050. Additionally, the deployment of CCS provides a way to increase connectivity regional not only between the countries of Central and Eastern Europe, but also between the Western Europe and CEE region. Cross-border projects accelerating the deployment of CCS, such as the development of CO2 transport and storage infrastructure, increase the diffusion of technological know-how, promote international cooperation and increase the economic development of the CEEC region by strengthening integration European economy.

At Bellona, ​​we know that CCS technologies are absolutely crucial to achieve full decarbonisation in different industrial sectors, and we advocate for European and national funds to be allocated to support the deployment of CCS at scale of the EU. EU. While we encourage Hungarian stakeholders to take the first step so that Hungary can start deploying the technology, an important piece of the puzzle is the recognition, support and funds available from the EU and national government for the entire CCS value chain.

Significant progress has already been made, one being the revision of the TEN-E regulation to include CO2 storage in addition to pipeline transport. The annual CCUS forum organized by the European Commission is another milestone. In addition, the ongoing TEN-T review is an opportunity to address one of the shortcomings cited by workshop participants in Hungary: by contributing to the deployment of additional transport modalities to pipelines, such as rail and truck.

Many thanks to Cambridge Econometrics Hungary and Energy Policy Group (EPG) for organizing the workshop and inviting Bellona Europa to participate. We are also grateful to grants from the EEA and Norway for funding the CCS4CEE project.

Laura T. Thrasher