EU to set up scheme to encourage CO2 removal from atmosphere

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BRUSSELS, Dec 15 (Reuters) - European Union policymakers said on Wednesday they will create a system to certify carbon removals next year, as a step towards establishing a regulated EU market to trade them and provide a financial incentive to store CO2.

Direct air capture and other technologies suck in air and use chemical reactions to extract carbon dioxide that can then be placed in long-term storage, while trees, soil and wetlands provide natural ways to remove CO2 from the atmosphere.

As part of its plan to have net zero emissions of all greenhouse gases by 2050, the EU wants to scale up removals to offset emissions from sectors like agriculture and heavy industry, which are not expected to be able to cut to zero.

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The European Commission said it will draw up a system of certifying carbon removals in 2022, by measuring CO2 removals from technologies and individual land holdings in the EU, and factoring in how long the CO2 would be stored.

That would allow farmers and landowners to earn EU-recognised credits for removing CO2, and to sell the credits to polluters that need to balance their emissions.

Some corporate giants such as Microsoft (MSFT.O) have said they are willing to pay a premium for removal offsets.

The system could lay the groundwork for an EU-regulated market to trade certified carbon removal credits after 2030, or add them into the EU's existing carbon market, which requires power and industrial companies buy a permit every time they emit CO2.

Some campaigners said adding removals to the EU carbon market in the 2030s risked undermining the impetus to focus on cutting outright emissions as much as possible.

"Are we going to get to 85%, 95% (emissions) reductions by 2030? Undoubtably not, because that's not even on the political table," Wijnand Stoefs, policy officer at Carbon Market Watch, said.

Removals can already be sold into voluntary markets for carbon offset credits, which lack standardised rules and have raised concerns over the environmental claims of some credits.

The EU wants initial projects to capture five million tonnes of CO2 from the atmosphere each year by 2030.

That is a tiny fraction of the more than 3 billion tonnes of CO2 equivalent the EU emits, but the target would attempt to kickstart nascent technologies.

Large-scale direct air capture projects are under development in countries including the United States, but not in the 27-country EU bloc.

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Reporting by Kate Abnett; Editing by Alexander Smith and Barbara Lewis

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