Carbon capture, usage and storage (CCUS): Ensuring fair access to CO2 infrastructure (accessible webpage)

Question 1

Introduction

Accepted Answer

The government is interested in establishing a competitive carbon capture, usage and storage (CCUS) market.

CCUS will decarbonise power and industry in a way that drives growth. The £21.7 billion of CCUS funding announced in October 2024 will support thousands of jobs as the sector matures into the 2030s. Initial investment in HyNet and the East Coast Cluster is expected to support an average of 4,000 direct jobs annually.

CCUS contributes to the lowest cost pathway to net zero, with the Climate Change Committee stating, ‘we cannot see a route to Net Zero that does not include CCS’. ^{[footnote 1]} Our modelling shows to achieve our carbon budgets and net zero without using CCUS would be several billion pounds a year more expensive over the 2030s.

To unlock the UK’s significant carbon dioxide (CO2) storage capacity, it is essential that companies that emit CO2 have access to transport networks and storage sites for the conveying and storing of captured CO2.

Aiming to encourage a self-sustaining market, the government is committed to reviewing third-party access arrangements to reduce the risk of monopolistic behaviour and ensure appropriate access regimes are in place to meet our carbon budget targets.

As such, this consultation seeks to assess whether the Storage of Carbon Dioxide (Access to Infrastructure) Regulations 2011 (the ‘Access to Infrastructure Regulations’ or ‘Regulations’) support the objective of a competitive CCUS market or require amendments.

Your response to this consultation will help us create a robust and adaptable CO2 transport and storage access regime that meets the needs of all users and promotes the long-term sustainability of the CCUS sector.

This publication is part of a series of four documents, which aim to progress key work areas that could help transition to a self-sustaining CCUS market.

When responding to this consultation, you may find it helpful to consider the content and relevance of the other documents in this series:

CCUS future networks strategy call for evidence (closed on 31 October 2025): This call for evidence discussed the need for government and industry collaboration and wider stakeholder engagement to develop CO2 transport and storage networks across the UK, focusing on the steps needed to advance network development towards a self-sustaining and commercially operated sector.
Evolution of economic regulation for CO2 storage call for evidence (closed on 31 October 2025): This call for evidence, jointly produced by DESNZ and Ofgem, was looking to understand whether the Regulated Asset Base model of economic regulation for CO2 storage will continue to best meet the needs of users, developers, investors and consumers as the CCS market matures; whilst also meeting carbon budgets. It sought views and evidence on elements of the economic regulatory regime in these key areas in relation to CO2 storage: economic regulation and natural monopolies, competition and storage costs, investment: equity and debt considerations.
CCUS non-pipeline transport (NPT) consultation (forthcoming): This consultation follows on from the May 2024 call for evidence on NPT and cross-border networks and the summary of responses published in November 2024, and sets out policy proposals to support the deployment of NPT projects.

Question 2

General information

Accepted Answer

Why we are consulting

To attract investment in the CCUS sector and safeguard participants against monopolistic behaviours, the government has introduced commercial and economic regulatory frameworks for CO2 pipelines and storage sites (‘CO2 infrastructure’), the Transport and Storage Regulatory Investment (TRI) model.

The Storage of Carbon Dioxide (Access to Infrastructure) Regulations 2011 (the ‘Access to Infrastructure Regulations’ or ‘Regulations’) pre-date the economic regulation of CO2 infrastructure. ^{[footnote 2]}

The overarching objective of the current Regulations is to facilitate transparent and non-discriminatory access to CO2 transport and storage infrastructure.

The purpose of this consultation is to gather perspectives on whether and/or how the Access to Infrastructure Regulations may need to be amended to:

reflect the policy environment that CCUS now operates in
support both the establishment of first-of-a-kind CCUS infrastructure as well as an enduring connections regime and future development of the CCUS market
support policy objectives for domestic emissions reduction as well as the reduction of global emissions through any future international agreements for CCUS

A review of the Regulations will also fulfil the statutory requirement to undertake a post-implementation review of the provisions which apply in England, Scotland and Wales. This post-implementation review will outline the original objectives intended to be achieved by the regulatory system, assess the extent to which the Regulations have achieved the original regulatory objectives, and whether those objectives remain appropriate.

Consultation details

Issued: 28 November 2025

Respond by: 6 February 2026

Enquiries to: ccustandsconsultations@energysecurity.gov.uk

Consultation reference: CCUS: Ensuring fair access to CO2 infrastructure. A review of the Storage of Carbon Dioxide (Access to Infrastructure) Regulations 2011

Audiences:

The government welcomes responses from anyone with an interest in the CCUS policy area. We envisage that this consultation will be of particular interest to:

stakeholders, including (but not limited to) those who are developing proposals for CO2 transport and storage infrastructure
those who intend to seek to use transport and storage infrastructure, including potential international users
relevant consumers
trade bodies

Territorial extent:

Although we invite responses from all regions, this consultation relates solely to the Storage of Carbon Dioxide (Access to Infrastructure) Regulations 2011. Any amendments to the Regulations will be made in consultation with the devolved governments as required by the Energy Act 2023.

The Storage of Carbon Dioxide (Access to Infrastructure) Regulations (Northern Ireland) 2015 are not within scope of this consultation and DESNZ officials will discuss any future amendments to these regulations with the Northern Ireland Department for the Economy.

How to respond

Respond online at: energygovuk.citizenspace.com/industrial-energy/review-storage-co2-access-infrastructure-regs-2011/

or

Email to: ccustandsconsultations@energysecurity.gov.uk

When responding, please state whether you are responding as an individual or representing the views of an organisation.

Your response will be most useful if it is framed in direct response to the questions posed, though further comments and evidence are also welcome.

Confidentiality and data protection

Information you provide in response to this consultation, including personal information, may be disclosed in accordance with UK legislation (the Freedom of Information Act 2000, the Data Protection Act 2018, and the Environmental Information Regulations 2004).

If you want the information that you provide to be treated as confidential, please tell us, but be aware that we cannot guarantee confidentiality in all circumstances. An automatic confidentiality disclaimer generated by your IT system will not be regarded by us as a confidentiality request.

We will process your personal data in accordance with all applicable data protection laws. See our privacy policy.

We will summarise all responses and publish this summary on GOV.UK. The summary will include a list of names or organisations that responded, but not people’s personal names, addresses or other contact details.

Quality assurance

This consultation has been carried out in accordance with the government’s consultation principles.

If you have any complaints about the way this consultation has been conducted, please email: bru@energysecurity.gov.uk.

Question 3

Background

Accepted Answer

The Storage of Carbon Dioxide (Access to Infrastructure) Regulations 2011

CO2 transport and storage infrastructure is essential for the development of a CCUS sector. It includes onshore and offshore pipelines and geological storage sites, such as depleted oil and gas reservoirs or saline aquifers. ^{[footnote 3]}

The Access to Infrastructure Regulations were enacted while the UK was a member of the European Union (EU) and provide for transparent and non-discriminatory access to CO2 infrastructure as per the EU’s ‘CCS Directive’ (Directive 2009/31/EC on the Geological Storage of Carbon Dioxide). ^{[footnote 4]}

The Regulations set out that any person seeking to join a network can apply to an operator of a pipeline and/or storage site who should consider the access request. There is an expectation that parties will negotiate an agreement.

Where the applicant and the owner do not reach agreement on an access request, the applicant may apply to the ‘relevant authority’ to make a determination. The relevant authority may be the Secretary of State, the North Sea Transition Authority (NSTA), or relevant ministers in the devolved authorities, depending on the location and type of infrastructure in question. The Regulations set out factors that should be considered by the relevant authority when considering disputes over access.

The Regulations also contain provisions for how planning consent and permission may be granted to modify existing pipelines or construct new ones. In certain circumstances third parties can request access to infrastructure before it is constructed.

CCUS commercial and regulatory frameworks

CCUS policy in the UK has undergone significant changes since the Access to Infrastructure Regulations were made. To enable private investment in the CCUS sector and safeguard against monopolistic behaviours, the government has introduced an economic regulatory regime (ERR) for CO2 pipeline transport and storage. This regime was established through the Energy Act 2023 (EA 2023).

The ERR is based on a Regulated Asset Base (RAB) model, which is typically used for monopoly infrastructure assets. Under this model, a company receives a licence from an economic regulator. The economic regulator sets a total revenue, known as the ‘allowed revenue’, which the operator can recover from users, usually through regulated charges.

Following consultation in 2019, a Regulated Asset Base (RAB) was identified as the preferred regulatory model for CO2 transport and storage. ^{[footnote 5]}

Under the EA 2023, the following activities are licensable, i.e. prohibited unless authorised by a licence (‘Licence’):

operating a site for the disposal of CO2 by way of geological storage ^{[footnote 6]}
providing a service of transporting CO2 by pipeline(s) all or part of the way to a site for the geological storage of CO2

The EA 2023 establishes the Gas and Electricity Markets Authority, the governing body of the Office of Gas and Electricity Markets (Ofgem), as the economic regulator of CO2 transport and storage with powers to establish, modify and enforce Licence conditions. Note that under provisions in the EA 2023, first-of-a-kind Licences are granted by the Secretary of State. The Secretary of State also determines the initial terms and conditions of these first Licences. ^{[footnote 7]} Once granted, the Licences are regulated by Ofgem.

The ‘allowed revenue’ is largely designed to cover operating costs, depreciation, and to provide an appropriate return on the operator’s investment. The ‘allowed revenue’ is then recovered through system charges paid by users of the network.

The EA 2023 also sets out the legal powers, functions and the general duties and principal objectives of the Secretary of State and the economic regulator in carrying out their respective functions.

The Licence requires Licensees to maintain and administer a network code. The CCS Network Code (January 2025) (‘the Code’) forms a key component of the business model and regulatory regime that has been developed for CO2 infrastructure. It gives effect to various conditions, including the obligation to offer access to the transport network and storage site in accordance with the Code, and sets out the commercial, operational, and technical arrangements between operators and users, together with governance arrangements.

The ERR forms part of the Transport and Storage Regulatory Investment (TRI) model, which has been developed with three key objectives:

attract investment in transport and storage infrastructure to establish a new CCUS sector
enable low-cost decarbonisation in multiple sectors
develop a market for carbon capture

Figure 1 – Diagram illustrating the TRI model

In this broad commercial model, the ERR sits alongside the:

Government Support Package (GSP), a ‘last-resort’ protection for companies against remote high-impact, low-probability risks (e.g. asset stranding)
Revenue Model, a ‘user pays’ model whereby network user payments make up revenue and the government provides ‘last resort’ revenue support where revenue falls short of the allowed revenue

The TRI model has been designed to facilitate the establishment of first-of-a-kind CCUS clusters in the UK, where targeted government financial support will help overcome market barriers to deployment. It is flexible in terms of ownership; the TRI model can comprise fully private funding but also a mix of private investment and government co-investment.

As the Access to Infrastructure Regulations pre-date the establishment of the economic regulation framework, we are reviewing the Regulations to ensure they remain fit-for-purpose in light of the economic regulation framework and the associated Licence and Code.

We must also ensure that third-party access obligations continue to protect user interests and promote the efficient and economic development and operation of CO2 infrastructure over the longer term. Subject to market conditions and potential policy developments, the CCUS market may transition to a ‘self-sustaining market’ as defined in the previous government’s CCUS Vision – a market that is largely industry-led and requires significantly less government support than the UK sector presently does.

Non-pipeline transport

Non-pipeline methods of CO2 transportation, such as road, rail, barge, and ship, offer an alternative to pipeline networks, providing flexibility in achieving decarbonisation across various regions and sectors.

Non-pipeline transport (NPT) will be necessary where connecting to a store via a pipeline is not technically or economically feasible.

NPT does not share the same monopolistic characteristics as pipeline transportation, as the potentially lower cost of market entry and the ability for multiple assets to run in parallel suggests competitive regional markets should emerge. ^{[footnote 8]}

As such, NPT is not currently within scope of licensable activities in section 2 of the EA 2023.

We intend to consult on NPT in due course. A call for evidence on support for the future deployment of NPT and cross-border CO2 has already been conducted, and a summary of responses has been published.

Question 4

Review

Accepted Answer

Securing access under the Regulations and the ERR

The economic regulation model provides for certain principles regarding access to infrastructure. Access to CO2 infrastructure can only be offered or made available by an economically licensed operator, in accordance with the Code, and provided the potential user undertakes to be bound by the terms of the Code.

Section C of the Code:

provides detailed guidelines on the criteria and procedures for determining how prospective users secure access to a network (including provision for users who may not need financial support to seek connection to the network)
sets out the process for resolving any disputes that arise between a user or prospective user and operators in relation to connection applications
sets out that access to CO2 infrastructure is provided for in accordance with a UK government-led selection process

If enabling an access request would require an expansion or modification of the infrastructure, the Licensee would first need approval from the economic regulator in accordance with the terms of the Licence. Given the government-backed financial protections available to first-of-a-kind CCUS clusters, expansions or modifications of these clusters would also require approval from the Secretary of State (e.g. a user may wish to enlarge their connection or extend its duration beyond the subsidised period).

The Code also sets out that connection agreements must specify mandatory ‘entry provisions’. These provisions include:

CO2 specifications required to ensure the safety, protection and operability of the transport and storage network
CO2 quality control procedures, including e.g. requirements for the equipment (including procedures, methods and standards) to measure, sample and analyse the CO2 stream
local requirements that apply to the CO2 delivery point

Users of CO2 infrastructure must comply with the provisions as specified.

The Access to Infrastructure Regulations were made prior to the establishment of the EA 2023 and do not recognise the role of the economic licensing regime and Code.

For example, the Access to Infrastructure Regulations do not reference ‘entry provisions’, but regulation 17 requires the owner of relevant CO2 infrastructure to publish information relating to:

the capacity (or in the case of storage sites the authorised capacity) which is or can reasonably be made available in the relevant infrastructure
technical specifications of the CO2 stream that must be met in order to secure access to the relevant infrastructure

The purpose of this regulation was to give effect to the CCS Directive’s requirement for transparency.

It may be expedient to expressly acknowledge and provide for the economic regulatory framework in the Access to Infrastructure Regulations (or through new regulations) to ensure clarity and avoid potentially conflicting outcomes.

We are also considering whether the Access to Infrastructure Regulations could be amended to avoid duplication, particularly where the economic licensing regime can provide similar or improved outcomes.

Alternatively, we could repeal the Access to Infrastructure Regulations and solely rely on the Licence and the Code to set out obligations and procedures in relation to access to networks. However, we would need to carefully consider the impacts of such an approach, including the effects on other legislation.

Future connections process

In future, the following scenarios may occur (and are not currently provided for by the Code):

A capture project that was selected under the first UK government-led processes on economically licensed CO2 infrastructure reaches the end of its revenue support contract and it wishes to agree to extend its connection duration directly with the transport and storage operator, i.e. outside of a government-led selection process.
A self-funding capture project wishes to agree a connection to economically licensed CO2 infrastructure, independently of a UK government-led selection process.
A self-funding capture project wishes to agree a connection to CO2 infrastructure that is exempt from the requirement to hold an economic licence and therefore, the conditions in the Code do not apply (see next section).

The future connection process under the Code may be similar to the processes for connection to the gas and electricity transmission networks, where prospective users are expected to follow a connection process set out by the relevant operator. This involves a direct approach or application to operators of pipelines and storage sites.

It will be important to ensure that any legislative provisions in the Access to Infrastructure Regulations operate effectively for both the first transport and storage networks and future networks. If the CCUS sector becomes able to operate with less government subsidy, how we allocate capture contracts is expected to change. These processes will need to be designed for the complex and interconnected nature of the developing CCUS industry. They should address how different projects, sectors and non-pipeline transport projects may participate, considering their differences. Additionally, they must account for interactions with existing allocation processes and markets, reflect sectoral decarbonisation targets and provide sufficient visibility and confidence to enable businesses to invest in developing their projects.

Regulations can make different provisions for different circumstances or for different purposes. For example, to avoid duplication or overlap between the Access to Infrastructure Regulations, the Licence, and the Code, the regulations could make different provisions in respect of the acquisition of access rights for first-of-a-kind licensed operators (given the government-backed financial protections available to these operators), or for infrastructure that is economically licensed compared to that which is not.

There may be other relevant considerations in relation to the scope and application of the Regulations, provided the principles of transparency and non-discrimination are maintained. For example, the Access to Infrastructure Regulations implemented the third-party access requirements of the EU’s CCS Directive, which does not apply to projects with a total intended storage below 100 kilo tonnes, undertaken for research, development or testing of new products and processes.

We would welcome views on any such considerations.

1. Do you have views on the extent to which the Access to Infrastructure Regulations are still needed, and if so, whether they could be amended to avoid duplication, particularly where the economic licensing regime might provide similar or improved outcomes?

2. Do you have views on which technical or capacity information CO2 transport and storage operators should be required to publish to enable fair and transparent access to CO2 infrastructure?

3. Do you have views on how the process for securing access to CO2 infrastructure should operate in the future? Please give reasons for your answer.

4. Do you think the approach to acquiring access rights should vary in different circumstances? Please give reasons for your answer.

Exemptions from the requirement to hold a Licence

The EA 2023 provides for the Secretary of State, by regulations, to grant exemptions from the requirement to hold an economic licence to carry out licensable CO2 storage and transport activities.

The purpose of this provision is to ensure that the prohibition on licensable activities operates effectively and as intended, and does not, for example, impact or inhibit activities that are not considered either technically or economically necessary or appropriate to economically regulate.

DESNZ has run a call for evidence to support the establishment of an exemptions regime, and further consultation is planned.

We welcome views on whether third-party access rights and obligations should be attached to CO2 infrastructure that is exempt from the requirement to hold an economic licence, and if so, how these obligations should best be applied (e.g. via regulations or via conditions attached to licence exemptions).

We ask a separate question in the next section on grounds for refusing access.

5. Do you have views on third-party access rights in respect of CO2 infrastructure that has been granted an exemption from the requirement to hold an economic licence? If so, how should these obligations be applied?

Refusal of access

The Access to Infrastructure Regulations foresee that there are circumstances in which it may be appropriate to refuse access to CO2 infrastructure. However, there is an expectation that measures are taken to make any necessary enhancements, where the user is willing to pay for them, provided this will not impact the integrity of the infrastructure or breach safety regulations, or affect the efficient operation of the infrastructure.

Regulation 12 reflects this in so far that, in the event of a dispute, the authority determining a dispute must, so far as is relevant, consider the following:

available or reasonably available capacity in relevant pipelines and authorised capacity in relevant storage sites
compatibility of the CO2 stream with the infrastructure’s design
unresolvable technical incompatibilities
other unresolvable issues affecting efficient CO2 transport or storage
reasonable needs of the owner and associates for CO2 conveyance and storage
interests of all users and operators of the infrastructure
contribution to the UK’s CO2 reduction legal obligations
number of parties involved in the dispute

We welcome views on the extent to which the above considerations remain appropriate in deciding whether an access request should be granted.

We are aware that the Licence and the Code have introduced concepts that do not form part of the Access to Infrastructure Regulations, e.g. ‘registered capacity’, which is the capacity booked by a user and represents their right (but not an obligation) to flow onto the transport and storage network at that rate.

In the following questions we are interested in understanding views on the factors that may be considered in determining an access request.

6. To what extent do you agree that the considerations set out in regulation 12 of the Access to Infrastructure Regulations reflect the relevant considerations for determining an access request? Please give reasons for your answer.

7. Do you have views on whether the considerations set out in regulation 12 also reflect the appropriate considerations for determining access to CO2 infrastructure that is exempt from the requirement to hold an economic licence? Please give reasons for your answer.

8. Are there any other circumstances where access to CO2 infrastructure should be able to be refused? Please give reasons for your answer.

Determination of disputes

The Access to Infrastructure Regulations give any person the right to apply to the owner of a CO2 pipeline (system) or storage site to use their pipeline (system) or storage for transporting or storing CO2. If the owner of the infrastructure and the person seeking access are not able to reach an agreement about the access application, the person seeking access can ask the relevant authority to make a determination about the application.

As described above, the relevant authority may be the Secretary of State, the NSTA, or relevant ministers in the devolved governments, depending on the location and type of infrastructure in question. ^{[footnote 9]}

The authority may serve a notice directing that the access sought should be permitted. The authority may also issue a ‘modification notice’ on the owner of the infrastructure, instructing that the infrastructure is modified to allow the applicant access.

The authority must consult a number of people and organisations when considering an access application, including the applicant and the owner, or any person with access rights to the pipeline(s) or storage.

As set out in the previous section, the authority must consider a range of factors when deciding if the applicant should be granted access.

The Access to Infrastructure Regulations do not account for the regulatory process introduced by the Licence and the Code, which sets out a process for seeking access and connecting to a network and establishes a mechanism for resolving disputes. This creates a risk of conflicting processes and decisions.

Ofgem, as the economic regulator, will set price controls for licensed CO2 transport and storage companies. At each price control determination, and potentially within a price control period through a re-opener, Ofgem will decide on network expansion plans, having regard to its statutory duties under the EA 2023. These duties include protecting the interests of current and future users, promoting the efficient and economic development and operation of the network, whilst having regard to operator financeability. Along with the access and connection processes set out in the Licence and the Code, this creates a transparent and robust regulatory framework to support network development. The process for resolving access disputes must appropriately reflect this economically regulated environment.

The future process of resolving access disputes for CO2 infrastructure will be complex due to the overlapping roles of various authorities. As Ofgem now has a role in the ERR, and currently the Secretary of State is responsible for selecting users as part of the government selection process, this adds an additional layer of complexity to dispute resolution. Additionally, the NSTA plays a role in licensing and permitting for offshore infrastructure and storage. It is therefore crucial that well-informed consideration is given to the most appropriate authority or authorities to determine access disputes as well as to the process for resolving disputes to ensure a consistent and efficient approach to dispute resolution.

In other economically regulated industries, the relevant legislation establishes that the regulator has the power to determine disputes over access. For example, the NSTA determines access disputes for oil and gas infrastructure ^{[footnote 10]}; the Office of Communications determines access disputes for communications infrastructure ^{[footnote 11]}; the Office of Road and Rail determines access disputes for rail networks ^{[footnote 12]}; and Ofgem resolves access disputes for gas and electricity. ^{[footnote 13]}

How the disputes process is defined – whether in legislation or accompanying guidance – varies, including which bodies the regulator must consult when determining a dispute.

For example, the process for resolving any disputes in the electricity sector is set out in guidance published by Ofgem, as required by section 23 of the Electricity Act 1989.

In considering the appropriate means of settling a dispute over access the following considerations are relevant:

expertise and consistency: the authority should possess the necessary expertise to handle disputes efficiently. The authority should ensure that access determinations are dealt with consistently and maintain a uniform approach to dispute resolution
regulatory oversight: this includes ensuring that network operators adhere to the principles of transparent and non-discriminatory access
preventing monopolistic behaviours: any authority determining disputes should be able to mitigate these risks and ensure that access to CCUS infrastructure remains fair and equitable
efficiency and economic development: the authority’s involvement in dispute resolution should promote the efficient and economic development of CCUS networks. They should be able to make informed decisions based on economic and technical considerations which would facilitate the optimal use of infrastructure and support the growth of the CCUS sector.

9. Do you have views on the process for determining disputes over access requests, including the appropriate authority to determine such disputes? Please give reasons for your answer.

10. Do you have views on whether the approach to dispute resolution should be different for CO2 infrastructure that is exempt from the requirement to hold an economic licence? Please give reasons for your answer.

Access requests prior to construction

The Access to Infrastructure Regulations provide that the relevant authority can impose conditions (‘variation conditions’) requiring a relevant pipeline or storage site to be constructed to a greater capacity, with design modifications or (in the case of controlled CO2 pipelines) on a different route to that proposed in the application.

The relevant authority may be the Secretary of State or Scottish Ministers, depending on the type and location of the infrastructure in question. ^{[footnote 14]} In certain cases, the Examining Authority, appointed by the Planning Inspectorate (PINS) on behalf of the Secretary of State, will examine the application and provide a recommendation to the Secretary of State. ^{[footnote 15]}

Where a proposed pipeline requires planning permission, the relevant authority may direct, through a ‘pipeline variation notice’, that the infrastructure is to be constructed to a capacity or design different from that proposed in the planning permission application.

The relevant authority can only impose variation conditions or serve a pipeline variation notice if it is satisfied that there is evidence of demand (or likely demand) for further CO2 storage sites and/or pipelines and (in the case of pipelines specifically) that demand would be for pipelines following a similar route for at least part of their length. The authority must also be satisfied that compliance with the variation conditions or pipeline variation notice will not compromise the safety or environmental integrity of the infrastructure or its efficient operation. ^{[footnote 16]}

The relevant authority can exercise these powers on its own initiative or in response to representations made by third parties who want to use the infrastructure.

Where the relevant authority exercises these powers, it can also serve a notice in relation to the additional costs that the owner will incur as a result of increasing capacity or modifying the design or route. The authority can require those additional costs to be borne by a person (‘the third party’) who has made representations about the need for the infrastructure to have greater capacity, a modified design or a different route.

Before imposing such costs, the authority must give the third party an opportunity to apply for access to the relevant infrastructure under regulation 12 (see Refusal of access and Determination of disputes above). This ensures that third parties are not served with a cost notice prior to access rights being secured. If the costs are not met within the time stipulated by the authority, the holder of the consent can request that the variation condition or pipeline variation notice be withdrawn.

The effect of these Regulations is that if a variation condition or pipeline variation notice is attached to consent, it allows a third party to seek access to the infrastructure prior to its construction, even if that third party did not make the application for the consent application. ^{[footnote 17]} If a dispute about that variation condition or notice arises, the dispute determination process can be triggered and the relevant authority can be asked to make a dispute determination, if the parties are not able to negotiate an agreement amongst themselves. ^{[footnote 18]}

The provisions in the Access to Infrastructure Regulations are similar to provisions in the Petroleum Act 1998 and the Pipe-Lines Act 1962, which provide for third parties to secure access to pipelines. The Regulations amended those Acts such that pipelines for transporting CO2 to a storage site are removed from their scope. Instead, they are subject to the regime established in the Regulations. This regime, however, also applies to storage sites.

While Ofgem, as economic regulator of CO2 transport and storage, does not have a decision-making role in the planning or consenting process for CO2 transport and storage infrastructure, it may be required to make determinations on network expansions to support user access in accordance with the Licence. In its decision-making function, Ofgem must act in accordance with its principal objectives, promoting the economic and efficient development of the network and protecting the interests of current and future users. Given the government’s financial support mechanisms for first-of-a-kind CCUS clusters, Secretary of State approval is also required for certain development decisions. Likewise, the Secretary of State must have regard to the promotion of economic and efficient network development.

Adjustments to a Licensee’s cost allowances must be approved by Ofgem in accordance with the Licence. If approved, this enables the Licensee to recover the associated costs through their use of system charges levied on network users.

For example, in the case of a network expansion, Ofgem approval would be required, such as via a Change in Scope re-opener. If agreed, this would allow the Licensee to recover the associated costs.

It is important to note that these conditions relate to the current versions of the Code and the Licence, both of which are subject to change over time as the Code and the Licence are further developed and refined.

The approach to considering access at the consenting stage as foreseen in the Regulations, and to allocating associated costs, is likely to need adjusting as a result of the introduction of the economic regulatory processes.

11. Do you have views on the approach to access rights at the planning/consenting stage as provided for in the Access to Infrastructure Regulations? Please give reasons for your answer.

12. Do you have views on the appropriate authority to determine third-party access disputes for CO2 transport and storage networks at the planning/consenting stage? Please give reasons for your answer.

13. Do you have any other views on access rights and obligations in the pre-construction stage?

Future networks

The first economic licences for CO2 transport and storage infrastructure have been granted to developers who will operate a full transport and storage network, comprising onshore pipelines, offshore pipelines, and associated offshore geological storage facility.

In the future, it may become desirable to separately license constituent parts of transport and storage networks. This would allow operators to specialise in the provision and operation of certain elements of the CO2 infrastructure (e.g. an onshore pipeline network, offshore pipeline network, or offshore geological storage site).

The government is giving consideration to future network strategy, including the design and development of economic, efficient, and resilient networks and enabling wider access to CCUS networks to users not within proximity to clusters.

A call for evidence on future CCUS network strategy sought views on these considerations. It will be important to ensure that principles enshrined in legislation are sufficiently flexible to future network evolution.

In a future CCUS system, there may be a selection of transport and storage services providers, with various operatorship structures and transport options, and the third-party access regime may need to enable third parties to seek access arrangements in transport and storage chains that may contain multiple separate entities.

This could be achieved in different ways, for example by potential network users seeking access to storage capacity directly with a storage site operator and separately agreeing a transportation arrangement, or transport operators securing storage capacity and then entering into agreements with users.

We welcome views on how to ensure frictionless access to future networks comprised of different modes and/or actors in the chain.

14. What expectations do you think prospective users will have regarding access to future networks, particularly in areas where they are not located near a cluster?

15. What expectations do you think prospective users will have regarding the flexibility of connecting to or accessing more than one transportation and storage option?

16. When do you anticipate that more than one transportation and storage option would become commercially viable? What arrangements would need to be in place to facilitate this?

17. Do you have any other views on access rights and obligations in relation to the evolution of transport and storage networks?

CO2 usage

CO2 may be captured and used rather than stored in geological formations. This process is referred to as carbon capture and usage (CCU) and may play a role in decarbonising some industrial processes.

We recognise that some carbon capture projects may want to integrate CCU with CCS and direct captured CO2 to use purposes, before entry to the CO2 transport and storage network.

Such ‘hybrid’ CCU/CCS projects are eligible for support under the Industrial Carbon Capture (ICC) business models. However, subsidy will only be provided for CO2 which is captured and directed to the CO2 transport and storage network for permanent storage. ^{[footnote 19]}

18. In considering the ability of ‘hybrid’ CCU/CCS users to secure access to CO2 infrastructure, what challenges, if any, do you foresee for these projects in switching between carbon storage and carbon usage pathways? How might these challenges be addressed?

Cross-border (international) transport and storage of CO2

Cross-border CO2 transport and storage networks enable the movement of CO2 captured in one jurisdiction for permanent geological storage in another. In the UK context, this may involve either the import of CO2 from international emitters for storage in UK stores or the export of CO2 from domestic emitters into international storage sites. These transfers may be facilitated by transboundary pipelines or NPT solutions (most likely shipping).

The UK’s substantial geological storage potential presents a strategic opportunity not only to support domestic decarbonisation but also to offer CO2 storage services to international emitters. This could unlock new economic value, enhancing the UK’s position in the European CO2 storage market, and contributing to global climate objectives. Cross-border CO2 networks are expected to play a critical role in enabling emitters to access cost-effective and reliable storage options, thereby increasing resilience and optionality in both transport and storage infrastructure.

While future cooperation with other countries including EU member states on cross-border CO2 storage will depend on the evolution of bilateral and multilateral agreements, we are keen to consider whether and how to accommodate such arrangements within the Access to Infrastructure Regulations.

19. Do you have views on third-party access rights and obligations on UK CO2 transport and storage operators in an international context?

Question 5

Consultation questions

Accepted Answer