Case study: Carbon capture, utilization & storage (CCUS) — a leading organization's implementation and lessons learned

In September 2024, the Northern Lights project—a joint venture between Equinor, Shell, and TotalEnergies—became the world's first commercial cross-border carbon capture and storage facility, storing CO₂ 2,600 metres beneath the North Sea floor. This milestone arrived as global CCUS operational capacity reached just over 50 Mt CO₂/year, while the EU's Net-Zero Industry Act mandated a binding target of 50 Mt CO₂/year injection capacity by 2030. For EU founders navigating the climate technology landscape, the gap between ambition and deployment has never been starker: Europe had 205 CCUS facilities in development by Q2 2025, yet only approximately 4 Mt of capture capacity and 14 Mt of storage capacity reached Final Investment Decision (FID) during 2024-2025. The European CCS market, valued at €1.2 billion in 2024, is projected to reach €12.14 billion by 2033 at a 21% CAGR—representing one of the fastest-growing segments in climate infrastructure. Understanding how leading organisations have implemented CCUS, the lessons they've learned about duration, degradation, revenue stacking, and grid integration, provides critical intelligence for founders seeking to capitalise on this €10+ billion opportunity.

Why It Matters

Carbon capture, utilization, and storage represents one of three technology pillars—alongside electrification and hydrogen—essential for achieving net-zero emissions in hard-to-abate sectors. The International Energy Agency estimates that CCUS must capture 1 billion tonnes of CO₂ annually by 2030 to align with 1.5°C pathways, yet current global capacity captures only 5% of this target. For EU founders, this supply-demand imbalance creates unprecedented market opportunity, but only for those who understand the operational realities that separate successful implementations from stranded assets.

The EU Industrial Carbon Management Strategy, published in February 2024, established a trajectory requiring 280 Mt CO₂/year capture capacity by 2040 and 450 Mt by 2050. This regulatory certainty, combined with the Net-Zero Industry Act's binding 2030 target, has transformed the investment landscape. The EU Innovation Fund allocated €5+ billion in November 2024 for 85 climate initiatives, with CCUS receiving priority status. Norway alone commits €1.6 billion annually to carbon management infrastructure, while the Netherlands has allocated €6.7 billion to CCS projects and the UK government committed £21.7 billion to its industrial clusters.

For founders, the strategic implications are profound. First, the hub-and-cluster model—shared infrastructure serving multiple emitters—has emerged as the dominant deployment paradigm, reducing per-tonne costs by 40-60% compared to standalone facilities. Second, revenue stacking across EU Emissions Trading System (ETS) allowances, voluntary carbon market credits, and offtake agreements has become essential for project economics. Third, permitting timelines remain the critical path constraint: projects in Norway achieve FID within 3-4 years, while German and Italian projects have stalled for 5+ years awaiting regulatory clarity.

The capacity factor economics deserve particular attention. Unlike renewable energy projects with weather-dependent generation, CCUS facilities targeting industrial point sources can achieve 85-95% availability rates—but only when capture technology matches the host facility's operating profile. The Heidelberg Materials Brevik cement plant, which began operations in late 2024 as Europe's first industrial-scale cement CCUS facility, demonstrates this principle: its amine-based capture system was specifically designed for continuous kiln operations, avoiding the cycling penalties that have plagued power sector applications.

Key Concepts

Storage Permanence and Duration: The fundamental value proposition of geological storage rests on sequestration timescales measured in millennia. The Northern Lights facility injects CO₂ into the Johansen Formation, a saline aquifer with an estimated geological storage capacity of 70 billion metric tonnes across Norway's North Sea territories. Regulatory frameworks require demonstration of 1,000+ year containment security, verified through seismic monitoring, pressure management, and tracer compound detection. For founders, duration certainty directly affects carbon credit pricing: permanent geological storage commands €100-150/tonne in voluntary markets, while temporary storage (forestry, soil carbon) trades at €15-40/tonne. The EU Carbon Removal Certification Framework, adopted in 2024, explicitly differentiates permanent from temporary removals, creating regulatory tailwinds for geological storage ventures.

Capacity Factor and Degradation Curves: CCUS economics are exquisitely sensitive to utilization rates. A capture facility designed for 1 Mt CO₂/year but operating at 70% capacity factor effectively increases per-tonne costs by 43%. Amine solvent systems—representing >80% of deployed capture capacity—experience degradation rates of 0.5-2 kg solvent per tonne CO₂ captured, depending on flue gas composition. Sulphur dioxide and nitrogen oxides accelerate solvent breakdown, requiring upstream scrubbing for coal and heavy fuel oil applications. The Quest CCS facility in Alberta, operated by a Shell consortium, has captured 8.8+ Mt CO₂ since 2015 while maintaining 95%+ availability through rigorous solvent management protocols. For founders developing capture technologies, demonstrating degradation resistance under real-world conditions—not just laboratory environments—represents the key technical differentiator.

Revenue Stacking and Additionality: No European CCUS project has achieved FID on carbon credit revenue alone. Successful implementations combine multiple revenue streams: EU ETS allowance value (€65-90/tonne in 2024-2025), voluntary carbon market offtakes, government contracts for difference (CfDs), and in some cases, utilization revenues from CO₂-derived products. Additionality—the requirement that emissions reductions would not have occurred without the intervention—presents particular complexity for CCUS. Projects capturing CO₂ from facilities that would operate regardless face "anyway capture" additionality challenges; projects enabling lower-carbon production (green cement, blue hydrogen) can demonstrate stronger additionality claims. The Carbon Removal Certification Framework addresses this through lifecycle assessment requirements, but interpretation remains contested across Member States.

Grid Integration and Energy Penalty: Capture technologies impose significant parasitic loads on host facilities. Post-combustion amine scrubbing consumes 2.5-4.0 GJ/tonne CO₂—equivalent to 25-35% of a coal plant's output or 15-20% for combined-cycle gas. This energy penalty directly affects grid integration: capture facilities represent predictable baseload demand, potentially valuable for grid balancing, but also compete with electrification for clean power supply. The emerging "electrochemical capture" approaches—using electricity rather than steam for solvent regeneration—offer potential for load-following operation aligned with renewable generation profiles. For founders, grid integration strategy increasingly determines project viability, particularly in markets with constrained transmission capacity.

What's Working and What Isn't

What's Working

Cross-Border Infrastructure Collaboration: The Northern Lights model—purpose-built transport and storage infrastructure accepting CO₂ from multiple nations—has proven commercially viable. Denmark, Belgium, the Netherlands, and Sweden have signed agreements with Norway for cross-border CO₂ transport, creating a network effect that reduces per-tonne infrastructure costs as volumes scale. The Phase 1 capacity of 1.5 Mt CO₂/year, operational since September 2024, will expand to 5 Mt/year in Phase 2 following the March 2025 FID. This shared infrastructure approach reduces individual project risk while establishing common technical standards.

Cement Sector First-Mover Advantage: The cement industry—responsible for 8% of global CO₂ emissions—has emerged as CCUS's most successful deployment sector. Unlike power generation, cement production generates unavoidable process emissions from limestone calcination that cannot be eliminated through electrification or fuel switching. The Heidelberg Materials Brevik plant captures 400,000 tonnes CO₂ annually from a facility with no alternative decarbonization pathway. This "no regrets" positioning has accelerated permitting approvals and unlocked €190 million in EU Innovation Fund support for the ANRAV project in Bulgaria and similar scale for Romania's Carbon Hub CPT01.

Corporate Offtake Agreements Unlocking Finance: Microsoft's carbon removal procurement commitments have catalysed project development across Europe. Offtake agreements with Stockholm Exergi's BECCS facility, Hafslund Oslo Celsio's Klemetsrud waste-to-energy plant, and Ørsted's Kalundborg project provided the revenue certainty required for Final Investment Decisions. These agreements, typically structured as 10-15 year fixed-price contracts at €100-200/tonne, bridge the gap between current voluntary market prices and infrastructure capital requirements. For founders, securing anchor offtake agreements before seeking project finance has become the standard pathway.

Regulatory Certainty in Lead Markets: Norway, the Netherlands, and the UK have established comprehensive CCUS regulatory frameworks encompassing permitting pathways, liability transfer mechanisms, and long-term monitoring requirements. The Norwegian Longship programme, providing €1.6 billion annually, offers a replicable template: government absorbs early-stage infrastructure costs while establishing commercial frameworks that attract private capital for subsequent phases. The UK's Track-1 and Track-2 cluster designations, backed by £21.7 billion in government support, demonstrate how targeted industrial policy can accelerate deployment.

What Isn't Working

Permitting Paralysis in Major Economies: Germany, Europe's largest industrial emitter, released its Carbon Management Strategy only in 2024 after years of political deadlock. Offshore storage remains legally prohibited, forcing reliance on cross-border transport to Norwegian facilities—adding €10-20/tonne in transport costs. Italy has approved zero CCUS projects despite substantial geological storage potential. Poland, with one of Europe's largest storage potentials, lacks the regulatory framework to develop domestic infrastructure. For founders, country selection has become a strategic imperative: projects viable in Norway or the Netherlands may be fundamentally unfinanceable in Germany or Italy.

Power Sector Economic Challenges: Coal and gas power plants with CCUS have consistently underperformed economic projections. The energy penalty reduces saleable electricity by 15-35%, while cycling operations—increasingly common as renewables dominate generation—accelerate solvent degradation and reduce capture rates. Boundary Dam in Saskatchewan and Petra Nova in Texas—the only operational power sector CCUS facilities at scale—have both experienced extended outages and capacity factor shortfalls. The UK's Net Zero Teesside Power project, reaching FID in December 2024, represents a renewed attempt at power sector CCUS, but its 742 MW gas plant will operate as baseload rather than flexible generation.

Direct Air Capture Cost Trajectories: Despite €1+ billion raised by Climeworks alone, direct air capture (DAC) costs remain at €400-600/tonne—4-6x higher than point-source capture from industrial facilities. The thermodynamic reality is stark: capturing CO₂ at 420 ppm atmospheric concentration requires fundamentally more energy than capturing from 4-12% concentration flue gas. While Climeworks' Generation 3 technology claims 50% cost reduction, achieving the €100/tonne threshold required for voluntary market competitiveness remains a 2030s prospect at best. Founders should approach DAC with appropriate scepticism regarding near-term scalability.

Utilization Market Limitations: Carbon utilization—converting captured CO₂ into fuels, chemicals, or building materials—has failed to achieve meaningful scale. The global CO₂ utilization market absorbs approximately 230 Mt CO₂/year, primarily for enhanced oil recovery, urea production, and beverage carbonation. Emerging applications in synthetic fuels and mineralized building materials remain pilot-scale. More fundamentally, most utilization pathways result in eventual CO₂ release, limiting climate benefits to temporary storage. The regulatory distinction between permanent storage and temporary utilization increasingly channels investment toward the former.

Key Players

Established Leaders

Equinor — Norway's state-controlled energy company operates the Northern Lights project and is developing the Smeaheia storage formation targeting 20 Mt CO₂/year capacity. With 45% ownership in the UK's Northern Endurance Partnership and 25% in Net Zero Teesside Power, Equinor has established a portfolio strategy spanning storage development, transport infrastructure, and industrial capture. The company targets 30-50 Mt CO₂/year transport and storage capacity by 2035, representing 25% of projected European CCS market share.

Shell — As equal partner in Northern Lights and operator of the Quest CCS facility (1.2 Mt CO₂/year since 2015), Shell brings two decades of operational experience to European deployments. The June 2024 FID on the Polaris project in Alberta (650,000 tonnes/year) and Atlas Carbon Storage Hub demonstrates continued commitment. Shell's 30% stake in Scotland's Acorn Project positions it for UK market expansion, though that project awaits Track-2 funding confirmation.

TotalEnergies — The third Northern Lights partner, TotalEnergies holds 10% of the Northern Endurance Partnership and operates Technology Centre Mongstad, Europe's largest carbon capture testing facility. The company's integrated approach spans capture technology development through storage operation, providing vertical integration advantages for project development.

Heidelberg Materials — The German cement multinational operates Europe's first industrial-scale cement CCUS facility at Brevik, Norway. With €190 million in EU Innovation Fund support for additional projects and commitments to carbon-neutral cement by 2050, Heidelberg has established first-mover advantage in the hard-to-abate industrial sector.

Aker Carbon Capture — Norway's leading pure-play capture technology provider, Aker has deployed its Just Catch modular systems at multiple European facilities. The company's standardized, containerized capture units reduce deployment timelines from 3-4 years to 12-18 months, addressing one of CCUS's primary bottlenecks.

Emerging Startups

Climeworks (Switzerland) — The global DAC leader has raised over $1 billion, including a $162 million round in July 2025. Operating the Orca and Mammoth DAC plants in Iceland with 36,000+ tonnes/year combined capacity, Climeworks has secured 6+ million tonnes of carbon removal supply agreements. Clients include SAP, TikTok, British Airways, and Morgan Stanley. While costs remain elevated at €400-600/tonne, the company's Generation 3 technology promises 50% reductions.

Carbon Clean (UK) — With $150 million Series C funding in 2024, Carbon Clean has developed the CycloneCC rotating packed bed system for industrial capture. The modular approach targets mid-scale emitters (100,000-500,000 tonnes/year) underserved by major equipment suppliers, addressing a significant market gap.

Neustark (Switzerland) — Pioneering carbon mineralization in demolished concrete, Neustark sources CO₂ from biogas plants and stores it permanently in recycled construction materials. Operating 18 capture/storage sites across Europe as of April 2024, with 30+ additional sites planned, the company has identified a circular economy pathway to permanent storage.

Greenlyte Carbon Technologies (Germany) — Developing low-energy DAC through liquid sorbent absorption and alkaline electrolysis, Greenlyte represents the emerging wave of electrochemical capture approaches potentially better suited to renewable energy integration.

Key Investors & Funders

EU Innovation Fund — With a €40 billion budget through 2030, the Innovation Fund has supported 16 CCUS projects representing 19 Mt CO₂/year capture capacity. The Fund covers up to 60% of total investment and operating costs, providing critical de-risking for first-of-a-kind deployments. The November 2024 allocation of €5+ billion for 85 climate initiatives included substantial CCUS representation.

Breakthrough Energy Ventures — Bill Gates' climate-focused venture fund has invested across the CCUS value chain, from Climeworks (DAC) to technology providers and infrastructure developers. The fund's "gigaton scale" thesis aligns with CCUS's inherent requirement for massive deployment.

UK Infrastructure Bank — Established to accelerate net-zero infrastructure, the Bank has provided £2 billion+ in financing commitments to CCUS projects including HyNet and East Coast Cluster developments. The planned Industrial Decarbonisation Bank, expected 2026, will expand this mandate.

Katapult (Nordic) — Focused on €0.5-5 million early-stage investments, Katapult has backed 12 CCUS startups across the Nordic region, providing crucial seed capital for technology development before projects reach infrastructure-scale financing requirements.

Examples

1. Northern Lights Phase 1 — The Blueprint for Cross-Border Infrastructure

The Northern Lights project, reaching first CO₂ injection in August 2024 and full operation in September 2024, provides the definitive template for European CCUS infrastructure development. The €3 billion Phase 1 investment, split equally among Equinor, Shell, and TotalEnergies, created transport and storage infrastructure capable of receiving 1.5 Mt CO₂/year from industrial emitters across Europe.

The project's development timeline reveals critical lessons. Planning began in 2017; FID was achieved in 2020 following confirmation of Norwegian government support; construction required 4 years. The total 7-year development cycle—rapid by infrastructure standards—reflected Norway's mature regulatory framework and concentrated permitting authority. Storage occurs in the Johansen Formation at 2,600 metres depth, with pressure and seismic monitoring providing real-time containment verification.

The commercial model innovates through standardized CO₂ specifications and tiered pricing. Emitters pay €50-80/tonne for transport and storage, with costs declining as volumes increase. The first commercial customer, Heidelberg Materials' Brevik plant, ships captured CO₂ by purpose-built vessel to the onshore terminal at Øygarden before pipeline transport to offshore injection wells. This separation of capture from transport/storage enables specialized development: industrial emitters focus on capture technology while infrastructure operators achieve economies of scale.

Phase 2, reaching FID in March 2025, will expand capacity to 5 Mt CO₂/year while extending the pipeline network to additional injection sites. The modular expansion demonstrates how initial infrastructure investment creates platforms for subsequent scaling—a pattern founders should study for capital-efficient deployment strategies.

2. UK East Coast Cluster — Industrial Policy Meets Private Capital

The UK's East Coast Cluster, comprising the Northern Endurance Partnership (transport and storage) and multiple capture projects including Net Zero Teesside Power, illustrates how coordinated industrial policy can unlock private investment. The December 2024 FIDs followed £21.7 billion in government commitments across both Track-1 clusters (HyNet and East Coast).

The Northern Endurance Partnership—45% Equinor, 45% bp, 10% TotalEnergies—will provide 2-4 Mt CO₂/year initial storage capacity, expandable to 23 Mt/year by 2035. Storage will occur in depleted gas fields and saline aquifers beneath the North Sea, leveraging the UK's unique geological endowment and existing offshore infrastructure.

Net Zero Teesside Power, a 742 MW combined-cycle gas plant with integrated capture, represents a renewed attempt at power sector CCUS following earlier commercial failures. The project's economic viability rests on three pillars: government contract-for-difference guaranteeing electricity prices; inclusion in the UK's Capacity Market providing availability payments; and shared transport/storage infrastructure reducing per-tonne costs. This revenue stacking—power market + capacity market + carbon infrastructure—demonstrates the multi-layered commercial structures required for CCUS project finance.

For founders, the cluster model's implications are significant. Individual capture projects benefit from shared infrastructure costs; transport and storage operators achieve utilization rates impossible with single-source CO₂ supply; government support concentrates in designated industrial zones rather than dispersing across scattered facilities. Locating within or adjacent to designated clusters has become a strategic imperative.

3. Porthos Rotterdam — The Continental Hub Model

The Porthos project, under construction in Rotterdam for 2026-2027 operation, demonstrates the continental European approach to CCUS development. Four industrial emitters—Shell, ExxonMobil, Air Liquide, and Air Products—will collectively supply 2.5 Mt CO₂/year for storage in depleted gas fields 20 km offshore.

The €2 billion project received €6.7 billion in Dutch government support, reflecting the scale of public investment required to establish CCUS infrastructure. Porthos connects to the broader ARAMIS project (FID expected 2025-2026), which will extend the transport network and add storage capacity. This layered development—initial anchor project enabling subsequent expansion—mirrors the Northern Lights trajectory.

Porthos's capture sources span hydrogen production (Shell, Air Products), industrial gases (Air Liquide), and refinery operations (ExxonMobil). This diversity provides revenue stability: if one emitter reduces operations, others maintain throughput. For founders, the multi-source model offers lessons for infrastructure project design—diversified customer bases reduce single-emitter dependency risk.

The project's permitting timeline deserves attention. Environmental impact assessment began in 2019; construction permits were secured by 2023; FID followed immediately. The 4-year permitting cycle—achieved within the Netherlands' established offshore regulatory framework—contrasts sharply with German and Italian paralysis. Country selection based on permitting pathway maturity, not merely geological storage potential, has become essential for project development.

Action Checklist

• Assess storage access pathways: Map proximity to announced transport infrastructure (Northern Lights, Porthos/ARAMIS, UK clusters) and evaluate cross-border CO₂ shipping logistics. Storage access increasingly determines capture project viability; projects >500 km from storage require ship-based transport adding €15-30/tonne.

• Model revenue stack comprehensively: Combine EU ETS allowance values (currently €65-90/tonne), potential CfD support, voluntary market offtakes, and any utilization revenues. Projects relying solely on ETS prices face significant downside risk from price volatility.

• Engage anchor offtake customers early: Approach corporate carbon removal purchasers (Microsoft, Stripe, Frontier) before finalising project finance. 10-15 year fixed-price offtake agreements at €100-150/tonne provide bankability that carbon market projections cannot.

• Select jurisdictions with regulatory clarity: Prioritize Norway, Netherlands, UK, and Denmark for project development. Germany, Italy, and Central European markets require cross-border storage arrangements adding cost and complexity.

• Design for capacity factor optimisation: Match capture technology to host facility operating profile. Avoid power sector applications with cycling requirements; prioritize continuous industrial processes (cement, hydrogen, chemicals) achieving 85-95% availability.

• Plan for monitoring and liability transition: Develop long-term monitoring strategies meeting 1,000-year containment verification requirements. Understand Member State liability transfer timelines (typically 20 years post-injection cessation) and associated financial security requirements.

FAQ

Q: What is the realistic timeline from project concept to CO₂ injection for a new CCUS facility in Europe?

A: Timeline varies dramatically by jurisdiction and project type. In Norway, integrated planning-to-operation cycles of 5-7 years are achievable, as demonstrated by Northern Lights (2017 concept, 2024 operation). The Netherlands achieves similar timelines within its established regulatory framework. UK projects under Track-1 and Track-2 designations target 4-5 years from FID to operation. However, projects in Germany require cross-border storage arrangements adding 2-3 years to development timelines, while Italy and Central European nations lack the regulatory frameworks for timeline predictability. Founders should budget 6-8 years for fully integrated projects in established markets, with significant extension risk in emerging markets.

Q: How do CCUS capture costs vary by industrial sector, and which sectors offer the best unit economics?

A: Capture costs reflect CO₂ concentration in source streams. High-purity sources (natural gas processing, ammonia production, ethanol fermentation) achieve €15-30/tonne—effectively requiring only compression and dehydration. Industrial processes with moderate concentrations (cement at 14-33% CO₂, steel at 20-27% CO₂) require €40-90/tonne for post-combustion capture. Power generation with 3-15% CO₂ concentration costs €50-100/tonne while imposing significant energy penalties. Direct air capture at 420 ppm atmospheric concentration currently costs €400-600/tonne. For founders, targeting high-purity industrial sources maximises economic viability; power sector applications should generally be avoided absent substantial policy support.

Q: What additionality standards apply to CCUS projects seeking carbon credit certification in European markets?

A: The EU Carbon Removal Certification Framework, adopted in 2024, establishes lifecycle assessment requirements distinguishing permanent from temporary storage. Geological storage achieving 1,000-year containment verification qualifies for permanent removal certification. Projects must demonstrate additionality—that emissions reductions would not occur under business-as-usual scenarios. For industrial capture, this typically requires showing that the host facility would operate without capture in the absence of the project. BECCS (bioenergy with CCS) projects face additional biomass sustainability requirements. Voluntary market standards (Verra VCS, Gold Standard) impose similar additionality requirements. Founders should engage certification bodies early in project development to confirm methodology eligibility before committing capital.

Q: How should founders approach the tradeoff between capture technology maturity and emerging lower-cost approaches?

A: Amine-based post-combustion capture represents the proven workhorse, with 8+ facilities operating globally at >100,000 tonnes/year scale. Solvent degradation, energy penalty, and equipment costs are well-understood; financing institutions accept technology risk. Emerging approaches—electrochemical capture, membrane separation, calcium looping—promise 20-40% cost reductions but lack operating track records required for project finance. The pragmatic path: deploy proven technology for near-term projects while monitoring emerging technology demonstrations. When evaluating novel approaches, require pilot data at relevant scale (>10,000 tonnes/year) and third-party verification of performance claims. Technology risk that delays projects by 2-3 years often exceeds potential cost savings from unproven approaches.

Sources

• International Energy Agency. (2025). "CCUS Projects Database: Global Status and Trends Q1 2025." IEA, Paris.

• European Commission. (2024). "Industrial Carbon Management Strategy: Pathway to 280 Mt CO₂/year by 2040." COM(2024) 62 final.

• Clean Air Task Force. (2025). "Carbon Capture and Storage in Europe: Slow but Significant Progress in 2025." CATF Europe.

• European Commission Joint Research Centre. (2024). "Clean Energy Technology Observatory: Carbon Capture, Utilisation and Storage in the European Union—2024 Status Report." JRC139285.

• Equinor. (2024). "Northern Lights Project: First Commercial Cross-Border CO₂ Transport and Storage Facility Operational." Equinor ASA.

• Bloomberg New Energy Finance. (2025). "European CCUS Project Tracker Q2 2025: 205 Facilities in Development." BloombergNEF.

• UK Department for Energy Security and Net Zero. (2024). "Carbon Capture, Usage and Storage: Government Investment and Track Process Update December 2024." DESNZ.

• DataM Intelligence. (2024). "Europe Carbon Capture and Storage Market: Size, Share, and Forecast 2024-2033." Market Research Report.