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The document examines how the Japanese steel industry, a major global producer, can engage in climate mitigation under post-2012 frameworks. It contrasts sectoral approaches—which are favored by energy-intensive industries to prevent carbon leakage and maintain competitiveness—with cap-and-trade systems. The author proposes four options for integration: incorporating sectoral approaches into Nationally Appropriate Mitigation Actions (NAMAs) or CDM reforms, establishing agreements outside the UNFCCC, relying on non-binding recognition of commitments, or implementing transnational sectoral trading. It concludes that while the Japanese government's support for sectoral approaches shifted under the Hatoyama administration, the industry continues to support them due to low costs and international competition risks.

The research investigates how asymmetric global climate policies can lead to carbon leakage, specifically the relocation of CO2-intensive industries like iron and steel. Using the Basque Country as a representative Old Industrial Region (OIR), the authors demonstrate that while relocation impacts may be negligible at a national level, they can significantly reduce regional GDP. The study finds that reducing emissions through industrial relocation is far more costly in terms of GDP loss than achieving the same reductions through cost-effective mitigation policies.

The document examines how a hypothetical carbon price of 3000¥/t would affect Japanese industry, identifying 17 subsectors at risk. While findings align with similar studies in the UK, Germany, and USA, the Japanese pig iron subsector is noted as being disproportionately affected. However, the overall impact on the competitiveness of final products like flat steel is expected to be minimal compared to other trade influences.

The report examines carbon leakage risks for energy-intensive industries—specifically cement, steel, and aluminium—when facing unequal global carbon prices. It evaluates tools such as free allocation of emission rights and border adjustments, noting that while free allowances can reduce leakage, they may distort carbon price signals and reduce incentives for low-carbon investment. The analysis suggests that border adjustments are particularly suitable for the cement sector due to the homogeneity of production technologies and carbon intensity across regions.

The report analyzes carbon leakage, which occurs when production shifts from regions with high carbon prices to those with lower or no prices, undermining climate policy effectiveness. It examines the EU ETS as a frontrunner and compares it with emerging systems in the US and Japan. The document evaluates mitigation strategies, including free allowance allocation, investment subsidies, and border adjustment measures (BAMs). It specifically analyzes the leakage potential of energy-intensive sectors like cement, steel, and aluminium, and discusses the legal and multilateral challenges of implementing border adjustments under WTO rules.

The Climate Strategies Research Prospectus 2009 details a comprehensive program of academic research designed to support government decision-makers. The work is organized into three primary themes: industrialised country commitments and global market mechanisms (including carbon leakage and emissions trading system linkages), global engagement, technology and finance (focusing on the UNFCCC's Reformed Financial Mechanism and technology innovation centres), and industry-specific sectoral approaches (specifically the steel and maritime sectors). The organization operates as a not-for-profit network, convening international experts to provide independent, fact-based assessments for policy formation, with a particular emphasis on the European Union, North America, and the Asia-Pacific region.

The report assesses the Clean Development Mechanism (CDM), noting significant project attrition and regulatory delays. It highlights the marginalization of Sub-Saharan Africa and the challenges faced by Indian industry, such as stringent additionality tests. The authors propose shifting toward programmatic and sectoral CDMs, suggesting specific reforms for the Chinese steel sector and the use of 'Retirement-CER Obligations' to support the Bali Action Plan.

The report analyzes the Clean Development Mechanism's (CDM) successes and failures, noting a heavy concentration of projects in China, India, and Brazil, while Africa remains largely sidelined. It argues that current project-based modalities and stringent additionality rules create high transaction costs and barriers for Least Developed Countries (LDCs). The authors propose shifting toward programmatic CDM to support small-scale projects and sectoral CDM to address heavy industry, specifically analyzing the Chinese iron and steel sector. Key recommendations include retiring CERs to ensure global emission reductions and reforming additionality testing to be more pragmatic and inclusive.

The report argues that while developing countries often have domestic drivers for climate-beneficial policies (such as energy security and health), resource constraints and political priorities limit their scale. It suggests that international support should move beyond the Clean Development Mechanism's (CDM) project-specific approach toward supporting broader domestic policy frameworks. The authors advocate for the use of intermediate policy indicators and targets—rather than final emissions targets—to provide shorter feedback loops and early rewards for implementation. Case studies from Brazil, China, Ghana, India, and South Africa illustrate specific sectoral opportunities in transport, steel, wind power, and solar energy. The report concludes that such cooperation should be anchored in the UNFCCC to ensure transparency and a fair distribution of financial resources for incremental costs.

The report assesses how the EU ETS affects industrial competitiveness, identifying that while most sectors can profit in the short term through free allowances and cost pass-through, a small number of carbon-intensive subsectors face significant risks. Using UK and German data, the authors develop 'Value at Stake' indicators to screen for exposed activities. The analysis concludes that leakage concerns are concentrated in a few subsectors, particularly cement and blast furnace steel, where high direct emissions and international tradeability create vulnerability. The report argues that free allocation can mitigate these risks but may create perverse incentives, suggesting that targeted policies or harmonized allocation across EU Member States are necessary to maintain economic performance while achieving emission reductions.

The document addresses common concerns and misconceptions regarding carbon capture and storage (CCS), asserting that it is a proven technology essential for reaching net-zero emissions, especially in industries like cement and steel where electrification is insufficient. It highlights Europe's significant storage potential and the role of government funding in scaling the technology.

The Inflation Reduction Act (IRA) of 2022 significantly increases the 45Q tax credit, raising incentives to $85/tonne for industrial and power generation facilities and $180/tonne for direct air capture (DAC) when stored in saline geologic formations. These updates lower the capture thresholds for credit eligibility—reducing the industrial requirement from 100,000 to 12,500 tonnes of CO2 per year and the DAC requirement to 1,000 tonnes per year—while extending the construction window to January 1, 2033. The document argues that these incentives make carbon capture more accessible for hard-to-abate sectors like steel, cement, and refineries. Additionally, it recommends that Germany develop a National Carbon Management Strategy, financial incentives such as carbon contracts for difference (CCfD), and a business case for negative emission technologies to ensure industrial decarbonization and global competitiveness.

The document argues that large-scale deployment of carbon capture and storage (CCS) is essential for the EU to reach climate neutrality by 2050, with estimates suggesting a need to capture between 490 and 600 million tonnes of CO2 annually by that date. It highlights that current deployment is significantly below the required trajectory due to inadequate policies and a lack of storage sites outside the North Sea. The brief advocates for the development of shared CO2 transport and storage 'hubs' and cross-border networks to reduce costs for industrial emitters, particularly in Southern, Central, and Eastern Europe. It specifically urges EU Member States to use the 2023-2024 NECP revision process to detail funding commitments, deployment targets, and storage capacity to align with the Net Zero Industry Act's target of 50 million tonnes of annual injection capacity by 2030.

The document argues that CCS is essential for decarbonising hard-to-abate industrial sectors like cement and steel and for achieving net-negative emissions after 2050. It details the technical process of capturing CO2 using amines or membranes and storing it in saline aquifers or depleted reservoirs at depths exceeding 800 metres. The text asserts that geological storage is permanent and safe, with projected annual leak rates as low as 0.0002% in regulated industries. While costs vary by source—ranging from under 90 euro per tonne for fertilisers to 700 euro for direct air capture—the document suggests that government support for shared infrastructure can drive down costs, similar to the trajectory of offshore wind. It highlights approximately 100 proposed projects in Europe, particularly around the North Sea, and notes that the EU may need to capture 300 to 600 million tonnes of CO2 annually by 2050.

Austria aims for climate neutrality by 2040, necessitating CCS for 'hard-to-abate' industrial sectors, particularly iron and steel which account for 50% of industrial emissions. While a 2011 ban on geological CO2 storage exists, the government recommends lifting it by mid-2025. A 2024 feasibility study suggests a national CO2 pipeline network could be operational by 2034 with an estimated capital investment of €12–18 billion. Due to limited domestic storage capacity (estimated effective capacity of 118–275 Mt CO2), Austria will likely need to export captured CO2 to other countries.

France aims to capture 30-50 Mt of annual CO2 by 2050, focusing on seven key industrial clusters and leveraging a conservative estimated storage resource of 4.8 Gt. The government has launched a national CCUS strategy and provided €5.6 billion for industrial decarbonisation, including 'carbon contracts for difference' for specific CO2 streams. Key projects include the Dkarbonation and GOCO2 initiatives, which focus on export terminals and pipeline infrastructure for hard-to-abate sectors like cement and steel.

The document outlines Poland's position as the EU's third-largest greenhouse gas emitter and advocates for the deployment of carbon capture and storage (CCS) to decarbonize energy-intensive industries. It highlights Poland's significant geological storage potential, exceeding 15 Gt of CO2, and discusses specific projects like GO4ECOPLANET and ECO2CEE. The text emphasizes that developing domestic storage and transport infrastructure is critical to reducing costs and avoiding high EU ETS emission fees.

Spain has a significant geological storage potential of 12 to 44 Gt of CO2, which could support the decarbonization of hard-to-abate industrial sectors such as chemicals, steel, and refineries. While the government's Long-Term Decarbonization Strategy acknowledges the need for CCS in sectors like cement production, the document argues that a lack of concrete national plans and regulatory frameworks creates a competitive vulnerability for Spanish industry as EU Emission Trading System prices rise. A detailed case study of the Ebro Basin indicates that CCS deployment there could mitigate 4.42 MtCO2/year by 2050 and create over 100,000 jobs. The document recommends that Spain prioritize funding for pilot projects, clarify permitting responsibilities between national and regional governments, and develop a comprehensive national carbon management strategy to foster low-carbon industrial clusters.

The document highlights a €10 billion funding gap for announced carbon management projects in Europe and argues that the EU ETS alone is insufficient to drive the deployment of carbon capture and storage (CCS). It recommends a faster phase-out of free allowances by 2029, a significant expansion of the Innovation Fund, and the use of Carbon Contracts for Difference (CCfDs) to provide investor certainty and bridge the gap between current ETS prices and the actual costs of carbon abatement.

The document advocates for the deployment of carbon capture and storage (CCS) in Central and Eastern Europe (CEE) to protect its industrial base from rising carbon prices and ensure a just transition. It highlights that CEE industries, particularly cement and steel, are critical for national defence and economic resilience but face a competitive disadvantage due to limited storage access. The text argues that domestic CO2 storage is significantly more cost-effective than export-reliant scenarios, necessitating cross-border infrastructure collaboration.