MAPPING OF NORTH EUROPEAN CO2 STREAMS RELEVANT FOR DANISH STORAGE As assessed in chapter 4, many of the North European countries are expected to apply CCS as a

measure to achieve 2030 and 2050 decarbonisation targets. However, not all of these countries have sufficient storage capacity (or an intention to store CO2 domestically) and will therefore need to seek foreign storage.

Based on insights from the previous chapter, this section will provide a mapping of possible CO2 flows between Denmark and Northern Europe, considering potential competing storages,

geographical conditions, clusters etc.

The foreign storages that could compete with Danish CO2 storages are mainly the UK and Norway with storages situated offshore in the North Sea. They could potentially compete with a large share of the CO2 export coming from the countries deemed relevant to export CO2 to Denmark (i.e. Germany, Sweden, Finland, The Netherlands but perhaps less likely Poland). Poland could also pose a potential competitive threat and compete with possible CO2 export streams from Finland and Sweden. Of course, this is if they decide to pursue CO2 storage in the future (as mentioned previously, geological storage of CO2 is prohibited until at least 2024 in the country).

Competition from the Baltics of CO2 exports is not expected since geological storage is not

possible in Estonia, while in Latvia and Lithuania, CO2 storage is currently prohibited. Additionally, in Latvia and Lithuania, the CO2 CCS potential is very limited as policies and climate strategies in these countries are not prioritising CCS and have a preference for CCU if they turn to greenhouse gas removal technologies.²⁰²

CO2 exports from the following countries are expected to be most relevant:

202 Ramboll analysis

71

• Germany: Large volumes of captured CO2 volumes intended for storage in foreign countries are expected, as the country has clearly announced it will not utilise CO2 storage capacities on its own territory. The CO2 volumes are concentrated around the Hamburg area and Northern Germany, where there are numerous power plants and large iron and steel plants. Transport of CO2 from Germany to Denmark by ship and through a pipeline are both feasible possibilities.

• Sweden and Finland: Although there is not a heightened focus on CCS in the countries’

climate strategies, compared to the focus on renewable energy and green hydrogen, the pulp and paper industries in these countries are the two largest in Europe. BECCS could therefore become highly relevant for both of these countries so they can close the CO2 emissions mitigation gap to reach their climate neutrality targets. Geological storage is not possible in Finland, and although Sweden has some storage capacities, the country has expressed a preference to export CO2. Moreover, many of the pulp and paper plants are situated close to the coast or rivers (since they use a lot of water resources in their production). It would be potentially effortless to export the CO2 from plants situated close to the coasts with shuttle tankers.

CO2 exports might potentially also come from the Netherlands and Poland:

• The Netherlands: The country has expressed that CCS is a temporary solution to emission removal until CCU and renewables become available at full scale. However, natural gas production is not expected to be phased out in the Netherlands, at least in the short- and medium-term; thus CCS has a large potential to be a key source to mitigate emissions at these plants. The Netherlands has CO2 storage capacities and is planning CCS projects, e.g. the Porthos project is the most known large-scale project. However, other projects are also being planned: Athos in Amsterdam and the Carbon Connect Delta project²⁰³. Depending on how the Dutch CCS projects progress, there might be some potential for CO2 exports in the short term, industry cluster projects acknowledge that the demand for storing CO2 might exceed the storage capacity and especially if the CCS project deliveries are faced with delays²⁰⁴. This means that the export of captured carbon to international carbon storage sites could be necessary for the short-to-medium term. Additionally, the Netherlands have ambitious renewable energy targets, however, they are the country furthest away in the EU from achieving their announced renewable energy targets²⁰⁵. To make up for this gap due to the delay of renewables deployment, CCS could be a potential solution to mitigate emissions. Therefore, CO2 emissions from both industry and the power & heat (mainly in the long-term since CCS is limited to industry sectors, to begin with) sector could pose some opportunities to utilise CCS, and some amounts could be exported. It is uncertain to which countries (or how the share of exported CO2 emissions would be split between countries) potential Dutch CO2 export volumes will be transported to. Norway, UK or Denmark could all be potential candidates, and therefore this is also limiting the forecasted CCS volumes from The Netherlands to Denmark. Therefore, Ramboll estimates that there is some potential of storing CO2 from the Netherlands in Denmark, yet the potential is smaller than the CO2 streams coming from Germany, Finland, and Sweden.

• Poland: The country has CO2 storage capacities, which could become relevant in the future and potentially also be cheaper than exporting CO2 to other countries. However, they have not announced interest in utilising their own CO2 capacities, and this is

prohibited until 2024. And thus, there is some potential for CO2 exports from Poland, but this is highly dependent on political decisions, and the unfolding of these are highly uncertain.

Norway and UK storages could potentially compete for all the CO2 volumes described above.

The potential of CO2 exports from the Baltic countries is limited or even deemed insignificant. As mentioned, the country’s policies are not focusing or prioritising CCS, and the CCS potential of CO2 for CCS are limited. Nevertheless, the governing party in power changes often in these countries and especially the Latvian and Lithuanian Government (depending on the ruling political party) have shifted between allowing CO2 storage and prohibiting it, which poses uncertainty with

204 European Commission, “Candidate PCI projects in cross-border carbon dioxide transport networks”

205 Eurostat – “Renewable energy statistics”

regards to the countries’ positioning towards CCS. Nevertheless, CCU is preferred above CCS in all of the Baltic countries.²⁰⁶

Figure 10:Overview of North European CO2 streams relevant for Danish storage

Source: Ramboll analysis, E-PRTR database

The indicative CO2 volumes relevant for Denmark (including domestic CO2 volumes) are estimated at up to ~45 MtCO2/y. Note that the volumes presented below are not final and only potential volume estimates subject to change since they depend on future policy decisions and climate strategies in different countries. This poses uncertainties since the political landscape and policies change, making it difficult to forecast the CO2 CCS potential. Additionally, the imported CO2 volumes are also dependent on the development of CO2 prices, competition from foreign CO2 storages and Denmark’s own CO2 storage capacity developments.

Table 42: Estimated CO2 volume that can be potentially imported to DK (MtCO2/y)

Country Total CO2 intended for CCS

(MtCO2/y)²⁰⁷

Comment Potential

import to DK (MtCO2/y) Germany 42 ~20% of all emissions are from clusters in Northern Germany; Since

capturable amount only includes large CO2 sources, an even higher share is expected from these clusters. Consequently, Ramboll estimates that up to 35% of emissions are within clusters; Additional CO2 can be imported via shuttle tanker transport. Due to general constraints, i.e.

that some CO2 can be difficult to access or not feasible for dispersed sources or sent to other competing countries, Ramboll makes the assumption that up to ~50% of the estimated CO2 volumes can be potentially transported to Denmark.

~21

206 Expert interview; Tallinn University of Technology

207 Calculated as an average annual value for the years from the start point (e.g. 2025 for UK and 2030 for some other countries) and up to 2050

73 Finland 12 The majority of capturable emissions comes from the pulp & paper

industry, which are often located close to coastline or rivers, and thus easily accessible. For financial estimates in this chapter, we assume that up to ~75% of CO2 volumes intended for CCS will be transported to foreign storages, including Denmark, of which half of the 75% can potentially be exported to Denmark. Only shuttle tanker transport applies.

~5

Sweden 17 ~6