In a Nutshell
- A pivotal mitigation technology to realise emissions reductions and carbon capture and storage (CCS) has been the primary focus of Norway’s efforts so far, both for national use and to store CO2 imported from abroad. CCS is considered a pivotal mitigation technology to realise emissions reductions in Norway.
- Norway’s Climate Change Act sets a 50%-55% greenhouse gas emission reduction target by 2030 and a goal to become a low-emission society by 2050.
- Norway has multiple R&D and innovation support programmes dedicated to CCS. To some extent, these also support CCS-based carbon dioxide removal (CDR) methods, such as DACCS and bio-CCS, which includes BECCS. Other conventional CDR methods also receive targeted support.
- The government needs to assess the proposals for a reversed tax and a reversed auction scheme for industrial CDR. A report by the Climate Committee is due in November to assess solutions to reach the 2050 goal.
Role for carbon removal in national climate policy
There are a few key Norwegian documents that touch on the possible role of CDR and carbon storage more generally. Norway’s Climate Action Plan 2021-2030 sets out the overarching plan to achieve 50-55% emissions reductions by 2030 but does not explicitly mention CDR. The plan also mentions a voluntary agreement made between the Norwegian government and the national agricultural organisations committing to reducing emissions and enhancing removals in the agricultural sector by 5 million tons of greenhouse gas emissions over the 2021-2030 period.
The Norwegian Environmental Agency, a government body within the Ministry of Climate and Environment, recently proposed innovative incentives for CDR. Recommendations include implementing a reversed CO2 tax and reversed offering monetary rewards for every tonne of CO2 removed. Additionally, they suggest combining a national CDR policy with the option to trade CDR credits in the voluntary carbon market. The agency’s subsequent report estimates a potential annual contribution of 1 MtCO2 through DACCS (Direct Air Carbon Capture and Storage) and 1 Mt + 0.5 Mt of bio-CCS, including BECCS by 2030, aiming for a 55% reduction.
The forestry sector in Norway has historically played a big role in land-use, land-use change and forestry (LULUCF)-based removals. It is Norway’s predominant greenhouse gas sink. Chapter 4 of the Climate Action Plan 2021-2030 presents a similar view on forestry’s role within LULUCF-based removals, as well as a dedicated report on the LULUCF sector.
Relevant legal frameworks
Norway’s Climate Change Act sets a 50 – 55% greenhouse gas emission interim target by 2030 compared to 1990 emissions levels, and a -90 – 95% target by 2050. There is no clear net-zero target enshrined in domestic law yet, but rather the ambition to become a low-emission society by 2050.
From 1 January 2023, facilities deploying CO2 capture and storage have been exempt from the national CO2 tax. This exemption is implemented through refunds from paid CO2 tax on mineral oil, petrol, natural gas and liquefied petroleum gas once the CO2 emissions have been captured and stored. Waste incineration plants deploying CCS can also be granted a tax exemption from the Norwegian waste incineration tax on the fossil CO2 emitted by the plants. This exemption may have a positive spillover effect on CDR, since part of the CO2 emitted comes from biogenic sources.
Norway was an early mover to ratify the amendment to the London Protocol, which allows seabed CO2 storage, calling on European countries to do the same. Norway has also launched bilateral discussions with several countries regarding CC(U)S, including Belgium, Great Britain, Germany, Switzerland, the Netherlands and the United States of America.
Support for R&D and Innovation
Norway’s CLIMIT Programme, initiated by the Ministry of Petroleum and Energy in 2005, is dedicated to CCS research, development, and demonstration. The programme is comprised of two support initiatives: CLIMIT R&D, administered by the Research Council of Norway, and CLIMIT Demo, managed by Gassnova, which specifically targets CCS development and demonstration. The CLIMIT programme has supported a limited number of DACCS and BECCS projects. Enova, a state-owned enterprise under the Ministry of Climate and Environment, extends financial support and guidance for climate and energy projects through the Climate and Energy Fund. This support also encompasses CDR projects, such as the direct air capture initiative, Removr.
The Longship CCS Project, launched in 2020, acts as the principal demonstration project for CCS in Norway, with a budget of around EUR 2.4 billion where roughly two-thirds of the total funding sourced from public funds. It consists of three parts:
- Northern Lights will transport CO2 from the coast of Norway to an under-seabed geological storage location. The project is a collaboration between Equinor, Shell and Total. In its first phase, a yearly storage capacity of 1,5 million tonnes of CO2 is projected over a 25-year operating period. This capacity will be used by the two Longship projects below. The remaining capacity is opened to CO2 from abroad. A first letter of intent with Yara, a Dutch company, was signed in August 2022 concerning 800.000 tonnes of CO2 per year from 2025. In May 2023, a transport and service agreement was signed with Danish Ørsted to store 430.000 tonnes of biogenic CO2 per year.
- A CO2 capture facility will be added to a cement factory in Brevik. About 10% of the CO2 emissions from the factory are of biogenic origin. The CO2 will then be transported by ship to the Northern Lights storage location. The facility is expected to be operational by 2024.
- Haflslund Oslo Celsio plans to capture 400.000 tonnes of CO2 per year from the biggest waste incineration facility in Norway. Since approximately half of the waste is of biogenic origin, this project could generate negative emissions. Captured CO2 will also be transported by ship to Northern Lights facilities. The project has been put on hold in April 2023 due to higher-than-forecasted costs.
The Norwegian Technology Centre Mongstad is a large-scale test centre for developing CO2-capturing technologies. It also participates in EU projects. It was established in 2012 and is owned by the Norwegian government, Equinor, Shell and TotalEnergies.
Regarding conventional CDR, Bionova, established in 2023, provides financial support for bioeconomy and natural climate solutions projects. It is set to support increased soil carbon sequestration and carbon sinks at the farm level. Innovation Norway, a government agency supporting innovation and development in Norway, can also be a source of financial support to CDR projects. There is also targeted support to promote practices increasing soil health and soil carbon sequestration, mostly through the Regional agri-environmental programmes (RMP). For example, the spreading of biochar and the planting of catch crop can receive support from the RMP.
On the horizon
The government still needs to assess the feasibility and impact of the Environmental Agency’s proposition for a reversed DACCS tax.
The Climate Committee 2050 must deliver a report by 1 November 2023, in which the Committee investigates which options Norway has to achieve its goal of becoming a low-emission society by 2050.
The start of the execution phase of the Longship project is due at the start of 2025.
- Net zero target: 2050
- 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: No
- Comprehensive CDR Target: na
- CDR Target for Conventional Removals: na
- CDR Target for Novel Removals: na
- 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: Yes
- Conditions on use of carbon credits: s
- Ministry of Petroleum and Energy – Responsible for coordinating an integrated energy policy. It is also a key actor in driving Norway’s advancement in CCS and responsible for handing out CO2 storage permits.
- The Climate, Industry and Technology Department – Department responsible for most of CCS developments.
- Ministry of Climate and Environment – Coordinates and implements the climate policy in Norway and operates the Norwegian carbon credit procurement programme.
- Norwegian Environment Agency – Responsible for the implementation of government pollution and nature management policy and the management and enforcement of various acts, for ex. The Greenhouse Gas. Emission Trading Act.
- Ministry of Agriculture and Food – Responsible for food and agricultural policy, which covers land utilisation, agriculture and forestry.
- Ministry of Finance – Responsible for planning and implementing the Norwegian economic policy. Among others, it is responsible for various tax schemes.
- The Research Council of Norway – The national strategic body for research. It manages research funding from all Norwegian ministries.
- Technology Centre Mongstad – Large-scale facility for the development of industrial-scale CO2 management technologies