ReportGovernance
Divide to Deliver: Policy Brief
We model three scenarios of how separate targets for CDR and emissions reductions can scale and develop.
With only two years of the global carbon budget left for a 66% chance of limiting warming to within
1.5 °C, the climate crisis has entered a critical phase. Aggressive emissions cuts and a rapid scale-up of carbon dioxide removal (CDR) globally are both essential to stay within this temperature
threshold and must accelerate immediately. At such a decisive moment, the EU is negotiating a
2040 climate target of at least 90% net emissions reduction, which must place the bloc firmly on
the path to climate neutrality by 2050 and net-negative emissions thereafter.
However, the credibility and feasibility of the 2040 net target depends on clarifying the respective
underpinning contributions of gross emissions reductions, temporary CDR (e.g., land-based sinks)
and permanent CDR. Without clear and separate targets, climate implementation becomes
fragmented and unreliable — undermining investor confidence, delaying essential infrastructure,
and eroding trust in the EU’s climate trajectory.
The European Commission’s February 2024 Communication indicated that up to 400 Mt CO₂/year
of carbon removals will be needed by 2040. Although the accompanying Impact Assessment (IA)
estimates up to 75 Mt of permanent removals may be needed, the Commission failed to define
separate contributions for permanent and temporary CDR — a major missed opportunity for
accountability and delivery planning. This omission carried over into the proposal, which
recommends a single net 90% emissions reduction target. Beyond announcing the upcoming
integration of permanent removals into the EU Emissions Trading System, it fell short of defining
the shares for gross emissions reduction, permanent removals, and temporary removals. This lack
of disaggregation undermines transparency, climate integrity, and effective policy design.
In response to the continued dismissal of separate targets and to challenge some of the
assumptions embedded in the Commission’s IA, Carbon Gap and VTT have modelled alternative
decarbonisation scenarios using a portfolio of CDR methods. These scenarios explore the use of
the like-for-like principle, ensuring fossil emissions are balanced with permanent removals, test
assumptions on biomass constraints, and consider uncertainties surrounding the capacity of the
Land Use, Land-Use Change, and Forestry (LULUCF) sector. The results show that:
- Separate targets are feasible and necessary. Scenario modelling shows that clearly defined 2040 targets for gross emissions reductions, temporary removals, and permanent CDR are achievable and essential to deliver climate integrity, policy clarity, and investment certainty.
- Temporary removals will be maxed out. According to our scenarios, temporary removals can deliver up to around 350 MtCO₂/year by 2040, with successful LULUCF measures. The EU must plan for the remaining gap with a credible permanent CDR strategy.
- Permanent CDR needs are large and vary according to the emissions reduction strategy. Depending on how emissions evolve, the EU will need between around 100–280 MtCO₂/year of permanent removals by 2040 — far more than the 75 Mt assumed in the Commission's Impact Assessment.
- No single method can deliver at scale. A diverse portfolio of CDR methods is required to manage cost, timing, and risk across scenarios.
- The EU must act now. The revision of the Climate Law is a once-in-a-decade opportunity to provide legal certainty by setting separate targets and back them up with dedicated policy tools needed to scale CDR.