The European Council announced that it has given final approval for the establishment of the first EU-level certification framework for permanent carbon removals, carbon farming and carbon storage in products, creating a voluntary framework aimed at craeing a certification system to quantify, monitor and verify carbon removals, and to counter greenwashing.

The adoption of the new rules by the EU Council marks the last major legislative step greenlighting the establishment of the new carbon removal certification framework.

Carbon removal solutions range from industrial technologies such as Direct Air Capture projects to natural carbon sinks. Financing for carbon removal projects can come from a variety of sources such as carbon credits or government incentives, creating a need for a system to verify and quantify the impact and quality of the projects.

The initial proposal for the certification framework was announced by the European Commission in 2022, forming part of the European Green Deal, the EU’s strategy to achieve climate neutrality by 2050. While the strategy relies primarily on absolute greenhouse gas (GHG) emissions reductions, emissions that cannot be eliminated will need to be balanced out with carbon removals.

Organizations that comply with the framework will receive certification that investors, partners, and clients will be able to utilize in order to determine a company’s compliance with efforts at carbon reduction. To qualify, organizations will need to implement systems to enable permanent carbon removal that will capture and store atmospheric or biogenic carbon for several centuries (such as bioenergy with carbon capture and storage, direct air capture with storage); implement systems to capture and store carbon in long-lasting products (such as wood-based construction products) with storage lasting at least 35 years; and systems for farms that enhance carbon sequestration and storage in forests and soils, or that reduce greenhouse gas emissions from soils, carried out over a period of at least five years (e.g. reforestation, restoring peatlands or wetlands, improved fertilizer use).

These carbon removal activities will need to meet four criteria in order for organizations to achieve certification: they must bring about a quantified net carbon removal benefit or net soil emission reduction benefit; they must be additional, meaning that they go beyond statutory requirements at the level of an individual operator and they need the incentive effect of the certification to become financially viable; they must aim to ensure long-term storage of carbon while minimizing the risk of carbon release; and they should do no significant harm to the environment and should be able to result in co-benefits to one or more sustainability goals

In addition, activities eligible for certification will need to be independently verified by third-party certification bodies in order to receive Council certification. The regulation also covers such third-party certification, with certifiers subject to robust and transparent monitoring, verification and reporting rules which will promote trust in the system and ensure environmental integrity. Liability mechanisms will also be in place for operators in order to address any release of captured carbon back into the atmosphere.

Four years after the regulation goes into effect, the Commission will establish an electronic EU-wide registry to ensure transparency and full traceability of organizations, which will be issued to reflect carbon net benefit generated through certified carbon removal and soil emission reduction activities. It will come into effect 20 days after it is published in the EU’s Official Journal, at which point it will apply to all EU member states.

The regulation will now be published in the EU’s Official Journal and enter into force 20 days after its publication. It will then become directly applicable in all EU member states, the Council said.