Why more and better access to EU funding for carbon removal is integral to reaching scale

By Eloisa Viloria

Unlocking carbon removal: navigating funding challenges in Europe

The race to develop and scale a variety of carbon dioxide removal (CDR) solutions isn’t just vital for hitting our climate goals—it’s also a golden opportunity for Europe to tap into a thriving new industry. But here’s the catch: securing enough funding for innovative CDR projects in the EU is still a major hurdle. This lack of financial support is holding back critical research needed to refine these solutions and get them ready for large-scale deployment. ?

The scale of the challenge

The current funding landscape for carbon removal is sparse. Based on our data, the EU directly allocated approximately €657 million to support carbon removal methods through various programmes including Horizon Europe, the European Innovation Council (EIC), the LIFE Programme, and the Innovation Fund between 2020 and 2023. Yet this value represents a mere 0.1% of the EU's total projected climate action budget for 2021-2027, a level of support that is far from enough.

If the EU is to meet its climate goals, it will need around €2.6 billion in the next seven years to truly advance these critical technologies and answer pressing research questions. But the EU cannot catalyse deployment alone. Fostering the development of a stable market for these technologies will depend on a combined approach – crowding in private investments and member state funding to boost research and development and grow the market.

Beyond the numbers: structural challenges in funding access

The funding challenges go beyond just money. Many carbon removal projects struggle to navigate a complex and confusing funding landscape. One of the problems is how funding opportunities are structured and presented to potential applicants:

• CDR projects are often lumped together with carbon capture and storage (CCS) in both EU (e.g. Horizon Europe and the Innovation Fund) and member state funding calls. It’s true that some carbon removal methods involve CCS, such as DACCS and BECCS, but framing the funding as CCS-specific hinders the visibility of carbon removal and leaves out non-CCS-based methods like ocean carbon removal, enhanced rock weathering or land-based removals.
• Funding calls are vaguely-worded and unclear as to what carbon removal projects they fund, making it hard for potential applicants to know whether they should apply. EU funds such as the Just Transition Fund and the Recovery and Resilience Facility (RRF) are generally available for the green transition, but it’s not clear exactly how much funding is available for carbon removal. The same is true of the Common Agricultural Policy (CAP) - it should technically be open to land-based carbon removal, but the distribution of the funding is very opaque.?

The navigation challenge

• Existing mechanisms can be overwhelming to navigate, especially for those who are unfamiliar with the maze of funding opportunities in the EU. EU funds target a wide array of topics with thematic calls per topic, so, ?despite a?central database for funding calls at the EU level, finding relevant projects among thousands of other calls can be a mammoth task, especially if calls are scattered across different official funding bodies and numerous websites. The same is true at the member-state level, especially if potential applicants are unfamiliar with country-specific organisms and structures. Language differences also add another layer of difficulty if companies are looking for funding outside of their own regions.?
• Even if a company has managed to find a relevant funding opportunity, understanding eligibility criteria, keeping track of deadlines, and complying with complex application procedures requires significant time and resources. These hurdles can become a real barrier for valuable carbon removal initiatives to access the support they need to develop and scale.

One piece of the puzzle: centralising information about funding opportunities

• To break down these bureaucratic barriers, Carbon Gap has developed a comprehensive database of existing funding opportunities for carbon removal projects, as a first step toward making EU and member state funding for CDR more visible and accessible. To resolve the current maze of information, our database:
• Allows project developers to quickly identify relevant funding opportunities, understand the main requirements, and track important deadlines – all in the same place, reducing the time and resources needed to search through various programmes, freeing more time and resources for them to focus on developing their technologies and preparing strong applications.
• Explains the various EU funding programmes, their relevance to CDR and their main application criteria.
• Makes the overall funding needs more visible and navigable by showcasing existing carbon removal funding opportunities and leading to potentially higher application rates for related projects.

Looking forward

The stakes are high, and the opportunity is immense. With this database, we aim to direct support and focus on carbon removal so Europe can become a global leader in these technologies and turn a critical environmental challenge into an economic and innovative opportunity. As the EU and member states continue to develop their approaches to carbon removal, it’s vital that they pledge higher funding support for carbon removal and do so in a way that is more visible and accessible. Having centralised, easy-to-navigate information about funding opportunities, coupled with?sufficient funding, can help ensure that promising carbon removal projects don't fall through the cracks, but instead contribute to the diverse and robust ecosystem we need to meet our climate objectives.

We will launch the CDR funding database on 18 February on our Carbon Removal Policy Tracker. Join us online or in-person in Brussels.