Changes from adopted text to adopted text

RemovedP9_TA(2023)0402

AddedP9_TA(2024)0195

Union certification framework for carbon removals

Committee on the Environment, Public Health and Food Safety

PE745.292

ChangedAmendments adopted by the European Parliament onlegislative 21resolution Novemberof 202310 April 2024 on the proposal for a regulation of the European Parliament and of the Council establishing a Union certification framework for carbon removals (COM(2022)0672 – C9-0399/2022 – 2022/0394(COD))

(Ordinary legislative procedure: first reading)

RemovedTitle: Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL establishing a Union certification framework for carbon removals, carbon farming and carbon storage in products

Change 1

AddedThe European Parliament,

RemovedRecital 1: (1) Under the Paris Agreement adopted under the United Nations Framework Convention on Climate Change22 ('the Paris Agreement'), the international community has agreed to hold the increase in the global average temperature well below 2° C above pre-industrial levels and to pursue efforts to limit the temperature increase to 1.5° C above pre-industrial levels. That commitment has been reinforced with the adoption, under the UNFCCC, of the Glasgow Climate Pact on 13 November 2021, in which the Conference of the Parties to the UNFCCC, serving as the meeting of the Parties to the Paris Agreement, recognises that the impacts of climate change will be much lower at a temperature increase of 1,5 ºC, compared with 2 ºC, and resolves to pursue efforts to limit the temperature increase to 1,5 ºC. The Union and its Member States are Parties to the Paris Agreement and are strongly committed to its implementation by reduction of greenhouse gas emissions and increase in carbon removals and carbon farming.

Added– having regard to the Commission proposal to Parliament and the Council (COM(2022)0672),

RemovedRecital 2: 2) At a global scale, the latest report23 by the International Panel on Climate Change (IPCC) points towards a decreasing likelihood of limiting global warming to 1.5 °C unless rapid and deep cuts in global greenhouse gas (GHG) emissions occur throughout the ongoing and forthcoming decades. The IPCC report also clearly states that ‘while reaching net zero carbon dioxide (CO2) or net zero GHG emissions requires deep and rapid reductions in gross emissions, the deployment of carbon dioxide removal to counterbalance hard-to-abate residual emissions is unavoidable if net-zero carbon dioxide (CO2) or GHG emissions are to be achieved’ and that ‘carbon dioxide removal (CDR) will be necessary to achieve net negative CO2 emissions’. This will require the large-scale deployment of safe and sustainable activities for capturing CO2 from the atmosphere and durably storing it in geological reservoirs, terrestrial and marine ecosystems, or products. Today and with current policies, the Union is not on track to deliver the required carbon removals: carbon removals in terrestrial ecosystems have been decreasing in recent years, and no significant industrial carbon removals are currently taking place in the Union. / 23 IPCC (2023). Sixth Assessment Report (AR 6 Synthesis Report).

Added– having regard to Article 294(2) and Article 192(1) of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C9-0399/2022),

RemovedRecital 3: (3) The aim of this Regulation is to develop a voluntary Union certification framework for carbon removals, carbon farming and carbon storage in products, with the view to incentivise the uptake of safe, sustainable and high-quality carbon removals, carbon farming activities and carbon storage in products, in full respect of the biodiversity and the zero-pollution objectives. It is a tool to support the achievement of the Union objectives under the Paris Agreement, notably the goal of collective climate neutrality by 2050 laid down in Regulation (EU) 2021/1119 of the European Parliament and of the Council24, as a complement to the irreversible and gradual reduction of anthropogenic greenhouse gas emissions across all sectors to meet the objectives and targets laid down in that Regulation and the goals of the Paris Agreement. The Union also committed to generate negative emissions after 2050. An important instrument to enhance carbon removals in terrestrial ecosystems is Regulation (EU) 2018/841 of the European Parliament and of the Council25.

Added– having regard to Article 294(3) of the Treaty on the Functioning of the European Union,

RemovedRecital 4: (4) The Union certification framework will support the development of activities in the Union regarding carbon removal, carbon farming and carbon storage in products that result in an unambiguous net benefit, while avoiding greenwashing. In the case of carbon farming, such certification framework should also encourage the uptake of activities that generate co-benefits for biodiversity, therefore achieving the nature restoration targets set out in Union law on nature restoration. The Union certification framework will be instrumental in meeting the Union climate change mitigation objectives set in international agreements and in the Union legislation.

Added– having regard to the opinion of the European Economic and Social Committee of 22 March 2023,

RemovedRecital 4 a (new): (4a) Several Members of the European Economic Area (EEA) and other third countries bordering the Union, such as Norway or Iceland, have significant potential for geological storage of CO2. Therefore, where a legally binding agreement has been concluded between the Union and a Member of the EEA or another third country bordering the Union and that country applies the same legal requirements as those set out in Directive 2009/31/EC, the Union certification framework should also apply to atmospheric or biogenic carbon captured in the Union but geologically stored in that Member of the EEA, or in that country bordering the Union.

Added– having regard to the opinion of the Committee of the Regions of 8 February 2023,

RemovedRecital 4 b (new): (4b) The Union certification framework should also encourage research and innovation, whilst emphasising the role of Horizon Europe missions, as well as other programmes in the field of technologies with carbon removal capacity, taking into account the existing processes and possible developments with the aim of facilitating access to the market for new technologies.

Added– having regard to the provisional agreement approved by the committee responsible under Rule 74(4) of its Rules of Procedure and the undertaking given by the Council representative by letter of 8 March 2024 to approve Parliament’s position, in accordance with Article 294(4) of the Treaty on the Functioning of the European Union,

RemovedRecital 4 c (new): (4c) In this regard, the Commission and the Member States should engage in cross-disciplinary cooperation, involving national and regional research institutions, scientists, farmers and small and medium-sized enterprises.

Added– having regard to Rule 59 of its Rules of Procedure,

RemovedRecital 5: (5) Activities regarding carbon removal, carbon farming and carbon storage in products have different characteristics as regards the storage process, the storage medium and the expected duration of the storage, which can vary from decades to centuries for certain carbon farming activities or storage in certain products, to permanent storage in geological formations if the site for geological storage of CO2 is appropriately selected and managed. In order to ensure the integrity of the framework while supporting operators willing to make additional efforts to increase carbon sequestration or biogenic emission reductions in a sustainable way, the Union certification framework should clearly distinguish the different types of activities, their specificities and related environmental impacts. Therefore, this Regulation should clearly separate the definitions, the quality criteria and the rules on the use related to activities regarding carbon removals, carbon farming and carbon storage in products in the Union certification framework.

Added– having regard to the opinion of the Committee on Agriculture and Rural Development,

RemovedRecital 5 a (new): (5a) Under the Union certification framework, activities that, under normal circumstances and using appropriate management practices, ensure the permanent storage of atmospheric or biogenic carbon for several centuries through geological storage of CO2, such as bioenergy with carbon capture and storage and direct air carbon capture and storage, or through permanently bound carbon mineralisation, should be considered permanent carbon removals. Activities related to land management in the subcategories of the land use, land use change and forestry sector covered by Article 2(1) of Regulation (EU) 2018/841 or related to coastal management, that result in carbon sequestration, or activities that result in biogenic emission reductions, such as methane reductions from feed changes or manure management, or nitrous oxide reductions from fertiliser reductions or manure management, for a minimum period of at least five years, are considered carbon farming activities. Certain carbon farming activities, in particular peatland rewetting, can result in carbon sequestration once the peatland is fully restored, while reducing carbon emissions through well-managed restoration and rewetting in an initial phase. Certain other activities, such as those based on the use of biochar, can be categorised under different types of activities depending on the specific conditions under which the activities take place. In light of the uncertainties in the measuring and monitoring methodologies related to …

Added– having regard to the letter from the Committee on Industry, Research and Energy,

RemovedRecital 5 b (new): (5b) The carbon removal certification framework should also provide the necessary flexibility to cater for regional, technical, structural and geophysical specificities, taking into account the variety of conditions in terms of production systems in the Member States and their regions.

Added– having regard to the report of the Committee on the Environment, Public Health and Food Safety (A9-0329/2023),

RemovedRecital 6: (6) This Regulation should set out the requirements under which carbon removals, carbon farming or carbon storage in products should be eligible for certification under the Union certification framework. To this end, carbon removals, carbon farming sequestration, carbon farming emission reductions and carbon storage in products should comply with the criteria on issuance and use; be quantified in an accurate and robust way; and they should be generated only by activities that generate a net benefit, are additional, ensure permanent or long-term carbon farming sequestration and/or the reduction of greenhouse gas emissions, and comply with the monitoring and liability requirements, and have at least a neutral impact or co-benefit on sustainability objectives in accordance with the requirements set out in this Regulation. Furthermore, activities should be subject to independent third-party auditing in order to ensure the credibility and reliability of the certification process, and the information relating to the certificates and certification process should be publicly available through a Union registry. Mandatory Union carbon pricing rules established through Directive 2003/87/EC of the European Parliament and of the Council26 are in place which regulate the treatment of emissions from activities covered by that Directive. This Regulation should be without prejudice to Directive 2003/87/EC, except in relation to the certification of removals of emissions from sustainable bioma…

Added1. Adopts its position at first reading hereinafter set out;

RemovedRecital 7: (7) An activity should result in a net benefit showing that it delivers a positive climate impact. The calculation of the net benefit should be differentiated for permanent carbon removals, carbon farming sequestration, carbon farming, carbon, nitrogen or methane emission reductions and carbon storage in products, in order to take into account their fundamentally different characteristics, and should be computed following two steps. First, operators should quantify, as applicable, the amount of additional carbon removals, in the case of carbon removal activities, the amount of additional carbon sequestration, in the case of carbon farming sequestration activities or carbon storage in product activities, or the amount of additional biogenic emission reductions, in the case of carbon farming emission reductions, that an activity has generated in comparison to a baseline. A standardised baseline should be representative of the performance of common current practices of comparable activities in similar social, economic, environmental and technological circumstances and geographical locations should be preferred because it ensures objectivity, minimises compliance and other administrative costs, and positively recognises the action of first movers who have already engaged in carbon removal activities. In order to ensure the climate integrity of the framework, in the case of permanent carbon removals the standardised baseline should be representative of the state-of-the-art of comp…

Added2. Takes note of the statement by the Commission annexed to this resolution;

RemovedRecital 8: (8) The second step for quantifying the net benefit should consist of subtracting any increase in greenhouse gas emissions related to the entire life cycle of the implementation of the activity. Relevant greenhouse gas emissions that should be taken into consideration include direct emissions, such as those resulting from the use of more fertilisers, chemicals, fuel or energy, or indirect emissions, such as those resulting from transportation, material inputs, displacement effects due to competing demand for energy or waste heat, or direct and indirect land use change with consequent risks for food security due to displacement of agricultural production, and should cover both the impacts within and outside the Union.

Added3. Calls on the Commission to refer the matter to Parliament again if it replaces, substantially amends or intends to substantially amend its proposal;

RemovedRecital 9: (9) An activity delivers a net benefit when, respectively, the carbon removals, the carbon sequestration or the emission reductions above the baseline outweigh any increase in greenhouse gas emissions due to the implementation of the activity. For instance, in the case of activities that deliver permanent carbon storage by injecting carbon underground, the amount of permanently stored carbon should outweigh the energy-related greenhouse gas emissions from the industrial process during capture, transport and storage as well as the displacement effects due to competing demand for energy or waste heat. In the case of carbon farming sequestration, the carbon captured and sequestered by an afforestation activity or the carbon kept in the ground by a peatland re-wetting activity should outweigh the emissions from the machinery used to carry out the activity or the indirect land use change emissions that can be caused by carbon leakage. In the case of carbon farming emission reductions, the carbon emissions reduced by a peatland re-wetting activity should outweigh the emissions from the machinery used to carry out the activity or the indirect land use change emissions that can be caused by carbon leakage.

Added4. Instructs its President to forward its position to the Council, the Commission and the national parliaments.

RemovedRecital 10: (10) Activities should be quantified in a relevant, accurate, complete, consistent, comparable and transparent manner. Uncertainties in the quantification should be duly reported and accounted as part of the certification methodologies, in a manner that is conservative, proportionate to the level of uncertainty, and in accordance with recognised statistical approaches and with the latest available scientific evidence, in order to limit the risk of overestimating the quantity of carbon dioxide removed from the atmosphere. Carbon sequestration and emission reductions generated by carbon farming should be quantified with a high level of accuracy to assure the highest quality and minimise uncertainties, based on the use of Tier 3 methodologies in accordance with the 2006 IPCC guidelines for National Greenhouse Gas inventories. Moreover, in order to incentivise synergies between Union climate and biodiversity objectives, enhanced monitoring of land needs to be required, thereby helping to protect and enhance the resilience of nature-based sinks throughout the Union. The satellite and on-site monitoring and reporting of emissions and removals need to closely reflect those approaches, and make the best use of advanced technologies available under Union programmes, such as Copernicus, making full use of already existing tools, and ensure consistency with the national greenhouse gas inventories.

AddedP9_TC1-COD(2022)0394

RemovedRecital 11: (11) In order to ensure that the Union certification framework channels incentives toward activities that go beyond the standard practice, activities should be additional. Therefore, these activities should go beyond statutory requirements at the level of the individual operator, that is, operators should carry out activities that are not already imposed upon them by the applicable law. In the case of carbon farming, such statutory requirements include relevant statutory management requirements and good agricultural and environmental conditions standards established under Title III, Chapter I, Section 2 of Regulation (EU) 2021/2115 and relevant minimum requirements for the use of fertiliser and plant protection products, animal welfare, as well as other relevant statutory requirements established by Union and national law, applicable at the level of the operator. Moreover, activities should take place due to the incentive effect provided by the certification making the activity financially attractive. Such effect is present when the incentive created by the potential revenues, resulting from the certification, changes the behaviour of operators in such a way that they engage in the additional activity to achieve additional net benefits.

AddedPosition of the European Parliament adopted at first reading on 10 April 2024 with a view to the adoption of Regulation (EU) 2024/… of the European Parliament and of the Council establishing a Union certification framework for permanent carbon removals, carbon farming and carbon storage in products

RemovedRecital 12: (12) A standardised baseline should reflect the statutory and market conditions in which the activity takes place. If an activity is imposed upon operators by the applicable law, its performance will be reflected in the baseline. For this reason, an activity that generates net benefits in excess of such a baseline should be presumed to be additional to statutory requirements. Hence, the use of a standardised baseline should simplify the demonstration of regulatory additionality for operators. Therefore, it should reduce the administrative burden of the certification process, which is particularly important in the case of small-scale land managers.

Added(As an agreement was reached between Parliament and Council, Parliament's position corresponds to the final legislative act, Regulation (EU) 2024/3012.)

RemovedRecital 13: (13) Atmospheric and biogenic carbon that is captured and stored through an activity risks being released back into the atmosphere (e.g. reversal) due to natural causes, including extreme weather and force majeure events, or anthropogenic causes. Therefore, operators should take all relevant preventive measures to mitigate those risks and duly monitor that carbon continues to be stored over the monitoring period laid down for the relevant activity. The validity of the certificate should depend on the expected duration of the storage or biogenic emission reduction and the different risks of reversal associated with the given activity. Activities that store carbon in geological formations provide enough certainties on the very long-term duration of several centuries for the stored carbon and can be considered as providing permanent storage of carbon. Therefore, the monitoring period and requirements of the certified storage generated by permanent carbon removals should be consistent with the provisions set out in Articles 13, 17 and 18 of Directive 2009/31/EC. Carbon farming or carbon storage in products are more exposed to the risk of voluntary or involuntary release of carbon into the atmosphere. To account for this risk, the monitoring period of the certified sequestration or emission reduction generated by carbon farming should cover at least the entire period during which the results of the activity are projected to be sustained as set out in the applicable certification m…

AddedANNEX TO THE LEGISLATIVE RESOLUTION

RemovedRecital 14: (14) In addition to measures taken to minimise the risk of carbon release into the atmosphere during the monitoring period, appropriate liability mechanisms should be introduced and a liable natural or legal person should be designated to be responsible for addressing cases of reversal. To avoid double regulation for permanent carbon removal activities, the liability mechanism should be consistent with the liability mechanism set out in Directive 2009/31/EC , while for carbon farming activities, the liability mechanism should be set out and approved as part of the applicable certification methodology and ensure that equivalent carbon sequestration is generated as compensation for the reversal. Such mechanisms could include e.g. discounting of carbon removal units, collective buffers or accounts of carbon removal units, a percentage of credits to be put in a pool managed by the certification scheme in the case of carbon farming activities, and up-front insurance mechanisms. In order to ensure that liability mechanisms continue to be fit for purpose, certification schemes should continuously monitor and ensure the availability and readiness of the liability mechanisms throughout the monitoring period of an activity.

AddedCommission statement on the occasion of the adoption of Regulation (EU) 2024/3012 of the European Parliament and of the Council establishing a Union certification framework for permanent carbon removals, carbon farming and carbon storage in products

RemovedRecital 14 a (new): (14a) To account for the risk of reversal and ensure the climate integrity of the framework, the certified units should be suspended in the registry until the reversal has been addressed through the liability mechanism. Where a reversal has not been addressed through the liability mechanism within a reasonable timeframe, the validity of the certificate should expire and the corresponding units should be cancelled from the registry and the operator or group of operators should be subject to a corrective penalty reflecting the carbon cost of the amount of carbon released to the atmosphere. For carbon farming activities and carbon storage in products, the validity of the certified units should be subject to an expiry date that corresponds to the end of the relevant monitoring period. Thereafter, or in the event that the monitoring is discontinued before the end of the monitoring period, the net benefit generated by the activity should be assumed to be released to the atmosphere and the corresponding units should be cancelled in the registry, unless the economic operator proves the maintenance of the carbon storage through uninterrupted monitoring activities.

AddedThe Commission intends to adopt the first delegated act, within one year after the entry into force of the Regulation, and to publish on its website, within six months after the entry into force of the Regulation, a forward planning document on the development of certification methodologies, which will be updated every year.

RemovedRecital 15: (15) Carbon removal, carbon farming and carbon storage in product activities have a strong potential to deliver win-win solutions for sustainability, even if trade-offs cannot be excluded. Therefore, it is appropriate to establish minimum sustainability requirements to ensure that carbon removal activities have at least a neutral impact or generate co-benefits for the sustainability objectives of climate change mitigation and adaptation, the protection and restoration of biodiversity and ecosystems, the sustainable use and protection of water and marine resources, the transition to a circular economy, and pollution prevention and control, to ensure that carbon farming activities generate co-benefits for at least the sustainability objective of protection and restoration of biodiversity and ecosystems and have at least a neutral impact on the sustainability objectives of climate change mitigation and adaptation, the sustainable use and protection or improvement of water quality and marine resources, the transition to a circular economy, pollution prevention and control and prevention of soil degradation, soil restoration, improvement of soil fertility and of nutrient management and soil biota, and to ensure that carbon storage in products activities generate co-benefits for at least one, and have at least a neutral impact on the rest, of the sustainability objectives of climate change mitigation and adaptation, the protection and restoration of biodiversity and ecosystems, the…

AddedIn addition, the Commission intends to organise appropriate opportunities to comment on the delegated acts, including through public feedback.

RemovedRecital 15 a (new): (15a) Furthermore, carbon farming activities should not negatively affect the Union’s food security and should not lead to land grabbing or land speculation. Such activities should respect the rights of local communities and indigenous people that they affect, both within and outside the Union, as well as the balance between the environmental, economic and social impact on local communities and small-scale land managers.

AddedThe Commission will comply with its commitments related to ensuring the Parliament’s and Council’s involvement in the process of preparation of delegated acts, including through systematic access for experts from the Parliament and Council to the meetings of the Commission expert groups as laid down in point 28 and the Annex to the Inter-institutional Agreement on Better Lawmaking of 2016.

RemovedRecital 16: (16) Farming practices that remove CO2 from the atmosphere contribute to the climate neutrality objective and should be rewarded, either via the Common Agricultural Policy (CAP) or other public or private initiatives. The Commission should, after consulting the Platform and within 6 months of the entry into force of this Regulation, publish guidance to inform potential carbon farming operators or groups of operators about those carbon farming activities that are to be prioritised in the preparation of the certification methodologies. / (deleted)

RemovedRecital 17: (17) Operators or groups of operators may report co-benefits that contribute to the sustainability objectives beyond the minimum sustainability requirements and certificates should clearly indicate the positive co-benefits generated by an activity, where applicable. To this end, their reporting should comply with the certification methodologies tailored to the different activities, developed by the Commission. Certification methodologies should, as much as possible, incentivise the generation of co-benefits for biodiversity going beyond the minimum sustainability requirements and, in the case of carbon farming activities, provide for the possibility of generating a carbon farming premium for such co-benefits. These additional co-benefits will give more economic value to the certified activities and will result in higher revenues for the operators. In the light of these considerations, the Commission should prioritise the development of tailored certification methodologies on those types of activities that are the most mature, have the potential for generating the largest net benefits and the potential to provide the largest co-benefits. In the case of carbon farming activities, such prioritisation should in addition take into account whether the activities contribute to sustainable management of agricultural land and forests.

RemovedRecital 18: (18) It is appropriate to develop detailed certification methodologies for the different activities in order to apply, in a standardised, verifiable and comparable way, the quality criteria laid down in this Regulation. Those methodologies should ensure the robust and transparent certification of the net benefit generated by the activity, be easy to use and developed in a manner that facilitates the verification of their compliance, and avoid creating a disproportionate administrative and financial burden for operators or group of operators, in particular for small farmers and forest holders and for small and medium enterprises, without compromising the quality of the carbon removals or co-benefits. To this end, the Commission should be empowered to supplement this Regulation by adopting delegated acts establishing detailed certification methodologies for the different carbon removal activities. Those methodologies should be developed in close consultation with the Platform on Carbon Removals , Carbon Farming and Carbon Storage in Product Activities and all other interested actors. They need to be based on a thorough impact assessment based on the best available scientific evidence and a minimum four-week public consultation period, and build upon existing public and private schemes and methodologies for certification where those comply with the requirements and criteria set out in this Regulation, and take into account any relevant standard and rules adopted at national, Uni…

RemovedRecital 19: (19) In order to ensure a credible and reliable certification process, activities should be subject to independent third-party auditing. In particular, all activities should be subject to an initial certification audit before their implementation, verifying their compliance with the quality criteria set out in this Regulation, including the correct quantification of the expected net benefit. All activities should also be subject to periodic re-certification audits at least every five years for carbon farming activities, and at least every 10 years for other activities, following a risk-based approach, to verify the compliance of the generated carbon removals, carbon farming sequestration, carbon farming emission reductions or carbon storage in products. To this end, the Commission should be empowered to adopt implementing acts to set out the structure, technical details, and the minimum information to be contained in the description of the activity, and in the certification and re-certification audit reports.

RemovedRecital 20: (20) Providing land managers with improved knowledge, tools and methods for a better assessment and optimisation of carbon farming is key for cost-efficient implementation of mitigation actions and for securing their engagement in carbon farming. This is particularly relevant for Union small farmers or forest holders that often lack the know-how and the expertise required to implement carbon farming activities and to comply with the required quality criteria and related certification methodologies. Therefore, it is appropriate to require that producer organisations facilitate the provision of relevant advisory services through technical advice to their members and, where relevant, support them with guidance and resources. The Common Agricultural Policy and national State aid, as well as other financial instruments, can support financially the provision of advisory services, knowledge exchange, training, information actions or interactive innovation projects with farmers and foresters. In cases of tenancy, the scheme should provide appropriate financial benefits or rewards for the manager of the land doing the work.

RemovedRecital 20 a (new): (20a) All removals, sequestration and biogenic emission reductions generated under this Regulation should contribute to achieving the Union’s nationally determined contributions (NDCs) or climate targets and objectives. However, in order to avoid double counting, a certified unit should not be used or claimed by more than one natural or legal person, such as undertakings or public authorities other than a Member State, like city councils or other municipalities, at any point in time, and should not be counted towards more than one Member State’s greenhouse gas inventories at any point in time.

RemovedRecital 20 b (new): (20b) The existing advisory services in agriculture and forestry, such as the Agricultural Knowledge and Innovation System (AKIS), should also contribute to broader knowledge and information to support sustainable practices that enhance carbon sequestration while promoting biodiversity and nature restoration, and to ensure easy access to this information including the use of digital solutions where relevant. AKIS should also set up a knowledge-sharing digital platform, providing technical advice to land managers and providing feedback to Member States.