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January 14, 2022

European Commission plans regulatory framework for carbon certificates

On December 16, 2021, the European Commission published the communication "Sustainable Carbon Cycles". Therein, it emphasizes the importance of actively removing CO2 from the atmosphere to meet climate targets. Such removals can be achieved through carbon uptake and storage in ecosystems, such as in forests or soils (carbon farming), or through industrial/technical processes.

In the land use sector (LULUCF), the plan is to achieve net annual removals of 310 megatons of CO2eq. by 2030, of which carbon farming initiatives should contribute 42 megatons. These initiatives will be supported by European instruments such as the Common Agricultural Policy (CAP), the LIFE program or the Cohesion Fund. Synergies with biodiversity goals, ecosystem services and increased climate resilience are expected. Regrettably, the Commission does not elaborate on the difficulties associated with soil carbon storage, e.g., the additional arable inputs or the limited storage capacities, which vary depending on soil type.

In this context, the Commission plans to create a European regulatory framework for carbon certificates that transparently considers criteria such as the duration of carbon removal, the risk of re-release, measurement uncertainties, and leakage effects. This is intended to increase confidence in the quality of traded certificates and is also a prerequisite for using them to fulfill European climate commitments. An expert commission is to be established to develop such a framework. The work of the BonaRes Centre on the suitability of soil carbon certificates for climate protection has already created an important scientific basis with regard to the agricultural sector. While we confirm the significant synergistic effects for all soil functions associated with soil organic carbon build-up, permanence of carbon storage cannot be guaranteed in the complex soil system. In addition, potential leakage effects, uncertain additionality, and lack of long-term monitoring present challenges for certification.

The Commission's consideration of climate-friendly behavior in agriculture also creates another point of contention: by December 2023, a study will examine the extent to which the "polluter pays" principle can be applied to greenhouse gas emissions in agriculture. This would have significant implications for agricultural practices. For example, draining organic soils for agricultural use would become uneconomical due to high greenhouse gas emissions.


Further reading:

Wiesmeier, M., Mayer, S., Paul, C., Helming, K., Don, A., Franko, U., Steffens, M., Kögel-Knabner, I. (2020). CO2 certificates for carbon sequestration in soils: methods, management practices and limitations. BonaRes Series. DOI: 10.20387/bonares-ne0g-ce98


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