On April 13, 2011, the German government adopted the draft act on the demonstration and application of technologies for the capture, transport and permanent storage of carbon dioxide (CO2).

The long-awaited CCS Act serves the purpose of implementing the Directive 2009/31/EC on the geological storage of carbon dioxide. This has created the prerequisite for testing projects regarding the CCS technology in Germany and to receive EU support.

CCS technology is considered an important step towards a climate protecting generation of power and industrial output. Irrespective of the accelerated increase in energy efficiency and expansion of renewable energies, conventional power plants will continue to be a basis of electricity production in Germany in the long run. Steelworks and chemical plants, e.g. chemical plants, will not be able to operate without emitting CO2, on a long-term basis. CCS can contribute to reducing emissions from these plants. The technology may also be used to reduce greenhouse gases from the use of biomass. The purpose of the capturing and storing the harmful carbon dioxide into – Carbon Dioxide Capture and Storage, "CCS" – is to prevent the carbon dioxide from being released into the atmosphere.

Due to the fact that the German federal states had different views regarding the implementation of CCS projects within their territory a compromise was needed. This compromise was reached in form of an opening clause which increases the possibility of the federal states to have more influence considerably. The federal states are now entitled to determine areas in which the storing of CO2 is admissible as well as areas in which it is precisely not admissible.

The draft act constitutes the first step of a legal basis for the storing of CO2. The draft act initially only allows testing and demonstration. However, in order to increase the public acceptance, citizens are intended have a say already in this phase.

A decision on a large-scale introduction of CCS will only be taken once there is sufficient proof of storage safety. The act will be thoroughly evaluated in 2017. A further expansion of the technology will only continue if the findings of the German Federal Government are positive

The key elements of the draft act include, among other things:

  • restriction of storage to demonstration purposes: Storage facilities may only be licensed if the application for the license is filed by the end of 2016 and the annual storage volume per facility does not exceed 3 million tonnes, and the overall volume nationwide does not exceed 8 million tonnes of CO2 per year
  • licensing of demonstration storage facilities: This requires prior investigation and a plan approval procedure with an environmental impact assessment. Precautionary measures must be taken against negative impacts on human beings and the environment in line with the state of the art in science and technology.
  • protecting other uses: possible uses of the underground, e.g. geothermal energy and energy storage, will be given adequate protection in order to ensure that CCS does not have a detrimental effect on other uses of the underground.
  • transfer of liability: A prerequisite for the transfer of liability prescribed by European law is, among others, proof of long-term safety to be provided by the operator. This ensures that the state does not have to take over unsafe storage facilities with unresolved risks.
  • financial security: The operator must provide financial security for the entire cycle (from the investigation to the transfer of liability). For the period after the transfer the operator must set aside funds for aftercare from the first tonne stored. This ensures that sufficient funds are available after liability has been transferred to continue monitoring storage and to tackle potential risks.
  • further regulations: The act also regulates the establishment and operation of carbon dioxide pipelines on the basis of energy industry law and capture facilities on the basis of federal immission control law (Bundesimmissionsschutzrechts). Additionally, all CCS facilities will be subject to emissions trading law.

The draft CCS act will form a legal framework for testing and demonstrating carbon storage that ensures planning and investment security. The regulations are intended to ensure that the launch of this technology is regulated in a gradual, risk-aware way and with an open outcome. The goal is to implement at least one of up to twelve demonstration projects planned EU-wide on this legal basis.

The parliamentary procedure for the draft act is now being initiated. The act is intended to enter into force of the act in autumn this year.