Exploring key dimensions of policy instruments for carbon dioxide removal

Integration of Carbon Dioxide Removal (CDR) into existing climate change mitigation policy frameworks has begun. A broad set of policy instruments is available for the development and deployment of CDR technologies. While current discussions emphasize carbon markets to scale CDR, other non-market based policy instruments could play an important role. This article examines several non-market policy instruments through a new CDR-specific assessment framework across four dimensions: feasibility, climate effectiveness, impacts on individuals and society, and the ratio and distribution of impacts. Four theoretical scenarios, heterogeneous in assumed time horizon, spatial coverage, and utilized non-market policy instrument, are evaluated: (1) a technology-specific Carbon Contract for Difference in the EU; (2) an internationally funded capacity-building campaign for Brazilian farmers to utilize voluntary carbon markets; (3) a global carbon takeback obligation for fossil fuel producers; and (4) a national corporate tax exemption for Direct Air Capture (DAC) plant setup and operation. The assessment finds that no single policy instrument performs strongly across all four dimensions. This suggests that the prioritization of policy instruments for CDR depends on how decision-makers weigh the assessed dimensions. Different stakeholder objectives will lead to different weighing of dimensions and, thus, rankings of policy instruments. Careful and transparent policy design process that reflects local contexts and national conditions is essential to ensure robust and stable decisions supported by a critical mass of stakeholders. A nuanced, inclusive approach can facilitate the implementation of a complementary suite of policy instruments that underpin responsible and effective global collaboration on CDR. A wide range of policy instruments is available to support Carbon Dioxide Removal (CDR), each with different characteristics, requiring careful and context-specific assessment.Policy instruments need to be tailored to the characteristic costs, scalability, and technological maturity of the wide range of CDR methods.No CDR policy instrument performs equally well regarding the assessment criteria of x and y – there´s no ‘one-size-fits-all’ solution for scaling CDR.Combining policy instruments may lead to sustainable CDR scaling. For instance, time-bound subsidies like Carbon Contracts for Difference allocated via reverse auctions can pave the way for market-based mechanisms in the long term. A wide range of policy instruments is available to support Carbon Dioxide Removal (CDR), each with different characteristics, requiring careful and context-specific assessment. Policy instruments need to be tailored to the characteristic costs, scalability, and technological maturity of the wide range of CDR methods. No CDR policy instrument performs equally well regarding the assessment criteria of x and y – there´s no ‘one-size-fits-all’ solution for scaling CDR. Combining policy instruments may lead to sustainable CDR scaling. For instance, time-bound subsidies like Carbon Contracts for Difference allocated via reverse auctions can pave the way for market-based mechanisms in the long term.