The UK and Europe risk missing out on major carbon capture and storage investment without stronger and more credible government backing, according to a new report from Marsh Risk.
The analysis, CCS at Scale: Aligning Risk and Reality in Carbon Capture and Storage, draws on views from 504 senior UK-based CCS decision-makers across the global value chain.
Europe currently leads globally for planned CCS investment, with 62% of industry leaders targeting the region. However, rising costs, regulatory gaps and policy uncertainty are threatening deployment and long-term competitiveness.
The average forecast cost to capture, transport and store CO2 is $163.45 per tonne, well above current carbon prices.
As a result, many projects are expected to remain reliant on national subsidies to be commercially viable.
Cost pressures are expected to intensify, with 42% of leaders forecasting cost increases of 11-15% and 31% anticipating rises of 16-20%. This is placing growing strain on project economics and investment decisions.
Final Investment Decisions are also being staggered, with 26% expected between 2025-27 and 35% between 2028-30.
While this may limit short-term risk, the report warns of a potential bottleneck later this decade.
Insurance is viewed as a critical enabler, with nearly two-thirds of respondents relying heavily on insurance to manage CCS risks. Despite this, engagement between risk, insurance and technical teams remains limited.
The report highlights growing competition from emerging CCS markets. The Middle East is benefiting from scale and cost advantages, while Japan and South Korea have strong government backing.
Projects are also advancing across Southeast Asia, Australia and China, positioning these regions as the next wave of global CCS investment.
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