The European Commission's proposed reform of the EU Emissions Trading System could turn biogenic CO2 capture into a compliance market asset. Starting in 2031, the EU plans to auction 250 million additional allowances and use the revenue to buy permanent carbon removals, including from BioCCS and DACCS. This creates a central buyer for removal units, which could improve project bankability for biomass plants, pulp mills, and ethanol producers. The proposal treats removals as a separate, higher-value asset than conventional allowances, recognizing that they cost more. For biogenic emitters, this could add a new revenue stream beyond voluntary markets and government support. However, infrastructure remains the key constraint. Facilities near CO2 transport and storage hubs will benefit most, while isolated plants may struggle. The design also includes safeguards to prevent removals from replacing actual emissions cuts, with a review point in 2034.
