The EU Carbon Removal Certification Framework : options for using certified removal units and funding mitigation activities : interim report

With the Carbon Removal Certification Framework (CRCF), adopted in 2024, the EU established a voluntary framework for carbon removal certification, which includes criteria for the certification of removals, rules for the certification process and the recognition of certification schemes. This report discusses the options for how certified removal units may be used and what policy options are available to complement funding for removals besides revenues generated through the CRCF. In its chapter 2, the paper discusses advantages and disadvantagesof possible types of uses of certified removal units. Possible ways of using carbon removal units and certificates are compared, including the use of removals in the EU NDC as the overall GHG emission reduction target, compliance use under the EU regulations including ETS, ESD, and LULUCF Regulation, as well as other compliance uses. Chapter 3 provides an overview of available instruments for incentivizing carbon removals. In addition some key voluntary private sector initiatives are presented. The focus is on those instruments that have been piloted on national levels or use regulatory instruments. For each instrument a brief overview is provided on potential strengths and risks. Chapter 4 presents interlinkages between CRCF implementation and existing national funding instruments with Germany as a case study. The chapter first presents challenges for national funding instruments for carbon removals and presents then potential interlinkages between CRCF and national funding instruments. Existing relevant national funding instruments and their financial capacities are discussed. Finally, conclusions on the role of the German government are drawn.