A wave of changes in regulations, standards, and policies in 2026 is poised to reshape Europe's carbon dioxide removal (CDR) market, tightening definitions of net zero while expanding the role of engineered CDR in climate policy.
Each of the changes could require operational changes in many companies. Collectively, these developments signal a formal ramp-up in the use of CDR for achieving net-zero, whether on the corporate scale or at the national level.
The changes in regulations, standards, and policies are in response to increased production and scrutiny of carbon credits as CDR evolves from voluntary claims toward a regulated environment.
CBAM law aims to eliminate "carbon leakage" (importing carbon credits from a country having less stringent climate rules).
When?
Beginning 1 January 2026 importers must purchase CBAM certificates for goods imported into the EU from countries having less stringent carbon credit rules.
Where?
European Union
Why?
To level playing field between EU countries and countries with less stringent carbon credit rules.
CRCF law sets minimum requirements for creating carbon credits in various types of CDR projects. Sets minimum requirements for CDR projects and carbon credit registrars.
When?
Expected in force in first half of 2026 for DACCS, BioCCS, and bichar, and later in 2026 for: agriculture, agroforestry, peatland rewetting, afforestation, and bio-based construction products.
Where?
European Union-member states.
Why?
Aims to drive investment in the CDR sector by reducing greenwashing, increasing integrity of carbon credits, and building trust and acceptance for responsible carbon removal practices.
The EU Commission's report will address several topics, including how CDR-generated credits can be accounted for in the EU ETS. (The EU ETS is the world's largest carbon cap-and-trade system that is international in scope, while China's domestic ETS is more than twice as large covering around 5.2 billion tons of CO2 annually).
When?
The EU Commission's report is due 31 July 2026.
Where?
The EU ETS regulates emissions in the and Northern Ireland.
Why?
The EU Commission's report is part of a comprehensive mandatory assessment of the EU ETS.
2026 expenditures of €156 million will be for support and scaling CDR projects, purchase of high-quality carbon removal credits, project administration, and strengthening soils as long-term carbon sinks.
When?
€156m in 2026 is part of €500 million to be spent through 2033.
Update of SBTi Corporate Net Zero Standard
Publication of Land Sector and Removals Standard
Carbon Border Adjustment Mechanism (CBAM) activated
EU's CRCF (carbon removal and carbon farming) Regulation expected to go into effect.
EU Commission report may propose allowing the use of carbon removal credits in the EU ETS (Emissions Trading System) beginning in 2030.
Final year of voluntary participation in CORSIA (Carbon Offsetting and Reduction Scheme for International Aviation)
€156 million to be spent on CDR in Germany
