In a Nutshell
- Climate policy is on hold in Austria, as a new climate law has not yet been approved. Until recently, Austria focused exclusively on land-based CDR pathways. However, novel CDR methods are rising in the domestic agenda.
- Given its lack of a climate law, Austria is subject to the European Union’s goal of climate neutrality by 2050. In 2022, it launched a domestic emissions trading system to cover energy-related emissions from sectors not covered by the EU-ETS.
- Austria has allocated significant funding to the Climate and Transformation Offensive, an initiative to decarbonise its industry. CDR and CO2 infrastructure could potentially benefit from these funds.
- Federal elections will take place in Autumn 2024. A national soil strategy is overdue and thus should be released soon.
Role for carbon removal in national climate policy
Austria’s climate policy is partly on hold, as a new climate law still needs to be adopted. Traditionally, Austria solely focused on land-based CDR, mostly through the agriculture and forestry sectors. This focus is poised to change as novel CDR methods rise in the domestic agenda.
Austria lacks a recent comprehensive long-term climate strategy, the last one dating back to 2019. While Austria has yet to publish its draft updated version of its National Energy and Climate Plan (NECP), a version was submitted for input to national stakeholders. In its introduction, the NECP mentions the storage of carbon in the areas of agriculture and forestry, including in wood products and via technical sinks as one of the seven key themes.
The NECP sets out a goal of increasing net carbon storage in the land-use, land-use change, and forestry sector (LULUCF) by around 0.88MtCO2 by 2030, bringing the target for net removals in the sector to 5.6MtCO2 in 2030. To achieve this target, several measures related to increasing carbon storage in wood products and forest floors have been laid out, as well as various measures aimed at soil carbon sequestration. The NECP provides information on how Austria plans to deal with its unavoidable emissions. It states that unavoidable emissions from point sources will be dealt with through CCUS, whereas emissions from “smaller, unavoidable sources” will be compensated by negative emissions, either through LULUCF-based sinks or through technical solutions, such as bioenergy with carbon capture and storage (BECCS). The remaining emissions from the agricultural and waste management sectors will be compensated by LULUCF-based sinks.
The NECP document also gives an overview of where Austrian climate policy stands and refers to relevant existing action plans and strategies.
The government work programme for 2020 to 2024 had set ambitious targets of reaching climate neutrality by 2040. However, no agreement has been reached yet. Consequently, Austria has been lacking a climate law since 2020 when the former climate law expired. This lack of a legal framework is even more concerning given the fact that Austria is on track to miss its 2030 climate target by a substantial margin, as stated in the current version of the draft updated NECP.
Relevant legal frameworks
The Climate Protection Act, which set Austria’s climate targets, expired in 2020. Therefore, the EU target of climate neutrality by 2050 applies. Following the recent increased ambitions in EU Climate Law, Austria must also reach 48% greenhouse gas (GHG) emissions reductions in sectors not covered by the EU Emission Trading Scheme (EU-ETS) by 2030 compared to 2005 levels.
In October 2022, the National Emissions Certificates Trading Law (NEHG 2022) entered into force. This law creates an emissions trading system for energy-related GHGs produced by non-ETS sectors, namely agriculture, waste and small industrial plants. The system is in a transitional phase from 2022 until 2026, during which a fixed price increase is set per annually, EUR 30, 35, 45 and 55 per tonne respectively. From 2026, the trading of allowances will be permitted and a cap on emissions will be introduced. The revenues are set to be used on relief measures; a type of financial support given in specific situations.
The geological storage of CO2 is banned in federal law, following the transposition of the EU CCS Directive. There is an ongoing consultation to see whether geological storage should be allowed.
The Austrian national parliament adopted the Forest Fund Act in 2020, which dedicates a EUR 350 million fund to domestic forests. It provides funding for the development of climate-fit forests, measures to reduce the infestation of bark beetles, reforestation, and the promotion of wood as a construction material.
Support for R&D and Innovation
A recent amendment to the Environmental Promotion Act has allocated EUR 2.975 billion by 2030 to transform the industrial sector. Since negative emissions have been identified as integral in the current version of the draft NECP to compensate for unavoidable emissions, part of this money could be used for CDR and CCUS at large. This new allocation of funding is part of the Climate and Transformation Offensive, which provides EUR 5.7 billion in total, the rest being dedicated to energy efficiency, research and local support.
The Climate Change Centre Austria, a network of Austrian climate researchers, has positioned CCUS as an essential research focus. It has organised several events related to CCUS and CDR.
The current version of the draft NECP mentions that there are ongoing efforts to promote the creation of CO2 pipeline infrastructure. A feasibility study has been commissioned by the Ministry for Climate Action to explore the development of an Austrian CO2 capture and transport network.
On the horizon
- Federal elections will take place in autumn 2024.
- A federal soil strategy is long overdue, being over one year and a half late.
- The government is expected to produce an assessment on how carbon farming could enable additional carbon storage in soils by 2026 latest.
- The quantification of the potential of natural carbon sinks by 2040 will be available at the end of 2024 when new scenarios will have been calculated.
- Austria will develop a carbon management strategy by 30 June 2024, which will most likely include some kind of targets for CCS, CCU and CDR for 2024-2030 and 2040, and an action plan by 2025.
- Net zero target: 2050
- Net Negative Target:
- First interim target: 2030
- Type of interim target: Emissions reduction target
- GHGs covered: Carbon dioxide and other GHGs
- Separate target for emission reduction and removals: Yes
- Comprehensive CDR Target: no
- CDR Target for Conventional Removals: no
- CDR Target for Novel Removals: no
- Historical emissions: No
- Annual reporting mechanism: Annual reporting
- Plans for carbon removal (CDR): Yes (nature-based and CCS-based removals)
- Planning to use external carbon credits: Not Specified
- Conditions on use of carbon credits:
Federal Ministry for Climate Action, Environment, Energy, Mobility, Innovation and Technology – Responsible for the country’s environmental and climate policy, as well as for regulating and managing transport, ensuring energy supply and promoting research and innovation.
Federal Ministry of Agriculture, Forestry, Regions and Water Management – Responsible for agricultural policy, forest management, regions and spatial development, and food and water policy.
Federal Ministry of Education, Science and Research – Responsible for education and higher education and research. It heads several research and scientific agencies, including the Austria Academy of Science, the Institute of Science and Technology and the Geological Survey of Austria.
Austrian Environment Agency (Umweltbundesamt) – Important environmental expert organisation supervised by the Ministry for Climate Action.
Austrian Research Promotion Agency – National funding agency for industrial research and development.
Climate Change Center Austria – Network of Austrian climate and climate impact researchers.