China’s policy framework for carbon capture, utilization and storage: Review, analysis, and outlook

Abstract

Carbon capture, utilization, and storage (CCUS) is estimated to contribute substantial CO₂ emission reduction to carbon neutrality in China. There is yet a large gap between such enormous demand and the current capacity, and thus a sound enabling environment with sufficient policy support is imperative for CCUS development. This study reviewed 59 CCUS-related policy documents issued by the Chinese government as of July 2022, and found that a supporting policy framework for CCUS is taking embryonic form in China. More than ten departments of the central government have involved CCUS in their policies, of which the State Council, the National Development and Reform Commission (NDRC), the Ministry of Science and Technology (MOST), and the Ministry of Ecological Environment (MEE) have given the greatest attention with different focuses. Specific policy terms are further analyzed following the method of content analysis and categorized into supply-, environment- and demand-type policies. The results indicate that supply-type policies are unbalanced in policy objectives, as policy terms on technology research and demonstration greatly outnumber those on other objectives, and the attention to weak links and industrial sectors is far from sufficient. Environment-type policies, especially legislations, standards, and incentives, are inadequate in pertinence and operability. Demand-type policies are absent in the current policy system but is essential to drive the demand for the CCUS technology in domestic and foreign markets. To meet the reduction demand of China’s carbon neutral goal, policies need to be tailored according to needs of each specific technology and implemented in an orderly manner with well-balanced use on multiple objectives.

Graphical abstract

Keywords

carbon capture / utilization / and storage (CCUS) / policy / content analysis / China

1 Introduction

Facing the challenge of tackling climate change, carbon capture, utilization, and storage (CCUS) has been recognized as an integral part of the technology portfolio to achieve net-zero emission worldwide. The Intergovernmental Panel on Climate Change (IPCC) indicated that, in most models, the global mean temperature rise cannot be limited within 2 °C without the carbon capture, and storage (CCS) technology [1]. The cumulative contribution of CCUS is estimated to be 15% of the global CO₂ emission reduction, reaching an annual capture amount of 10.4 billion tons across energy sectors in 2070 when net-zero emission is achieved [2]. CCUS also plays an important role in reducing the cost of emission reduction. The mitigation costs to reach the 2 °C target would increase by an average of 138% without CCS [1], and no coal could still be in use without CCS in 2050 under the 1.5 °C target, which means many coal-fired facilities would be at risk of running aground [3]. In China, the contribution of CCUS is estimated to be 1–1.82 billion tons in 2060 to achieve the carbon neutrality target [4].

However, the current development of CCUS is far from meeting such a large demand, as most CCUS technologies are still in the demonstration stage. By Sept. 2021, there had been 31 large commercial CCUS facilities in operation or under construction worldwide with a total capture capacity of only approximately 40 million tons [5]. The gap between the current capacity and future demand is even larger in China. By July 2021, there had been 49 demonstration projects in operation or under construction in China, with a total capture capacity of approximately 3 million tons [6].

Considering the limited technology maturity and small market demand, the guidance and support of policies are of vital importance in the current stage to promote the development and commercial application of CCUS. Compared with other research topics such as technology research and economic analysis, there are relatively few studies on CCUS policies. The existing policy studies fall broadly into three categories. The first category is studies that specifically take policies as research objects. For example, Gu [7] and Jiang et al. [8] summarized and discussed the policy framework of CCUS at that time in China, which were two of the few studies to provide comprehensive analyses of China’s CCUS-related policies. A number of researchers conducted policy analysis on certain aspect of CCUS as well. For example, Liu & Leamon [9] and Cai et al. [10] investigated environmental regulations of the CCUS technology. Diao et al. [11] discussed the regulations on CO₂ storage. Zhang et al. [12] and Li et al. [13] performed studies on CCUS roadmaps. Downie and Drahos [14] conducted a comparative study from a perspective of differences between China and the US. The second category is policy analysis as a part of a comprehensive review on multiple aspects of CCUS. These reviews not only summarized China’s CCUS-related policies, but also reviewed technology research, demonstration projects, reduction capacities, risks and opportunities of CCUS in China [15–19]. The third category is discussion about policy implications in studies on other topics. For instance, some researchers carried out source-sink matching research and discussed implications for layouts of CCUS deployment and carbon pricing policies [20–22]. Researchers also conducted studies on investment in CCUS and proposed policy suggestions on subsidy scheme, carbon pricing, reduction potential, and retrofitting window period [23–27]. These studies have provided important references for the development of the CCUS policy system in China, but most of these analyses were conducted before the proposal of carbon neutrality target, and thus a large number of policies recently issued were not included. In addition, the analysis of policies usually focused on policy documents rather than the detailed policy terms, and are mostly qualitative analysis.

In this study, a semiquantitative analysis was conducted on CCUS-related national policies as well as specific policy terms in China. First, the policies included and method used in this study are introduced. Then, the up-to-date relevant policy documents are reviewed, and analysis and discussions are conducted. Major conclusions and outlooks are given in the final part.

2 Data and method

2.1 Policies

In this study, 59 national policy documents related to CCUS technologies were selected, which meet both of the following two conditions. First, only policies released from the central government were collected. Although relevant policies were released by provincial governments as well, local policies were usually regarded as the implementation or refinement of national policies, and are thus not collected. Second, only policies that explicitly mentioned CCUS or any of its technical procedures are included. For example, a number of policies mentioned ‘low-carbon technologies’ that involve a much wider range of technologies than CCUS. Therefore, such policies are excluded. Under the above criteria, 59 CCUS relevant policies were screened out from official websites of the Chinese government, as listed in Electronic Supplementary Material (Table S1).

2.2 Content analysis

In this study, specific policy terms were analyzed following the method of content analysis. The content analysis method originated from journalism and communication science, and was widely used in social, information and even medical science [28]. This method generally involves 6 steps, including identification of research topics, selection of document samples, identification of analysis units, determination of classification criteria, content coding and statistics, and interpretation and evaluation.

In terms of analysis units, policy terms that specifically relates to CCUS were extracted from the above policies. Basically, a paragraph with the same policy target was treated as an analysis unit. In the case that a paragraph involved different policy targets, the paragraph was broken down into several units according to policy targets. A total of 277 analysis units were identified in this study.

As to classification criteria, the analysis units were categorized from the following three dimensions.

Dimension X: policy objective. Policies were categorized according to the classification method of Rothwell and Zegveld [29,30], who divided policies into three categories: supply, demand, and environment. The supply-type policies refer to policies supporting the technology itself, such as promoting the research and development. The demand-type policies involve policies such as government procurement and establishing overseas sales branches that can help form stable market of the technology. Environment-type policies indicate policies that provide enabling environment for technology development and commercialization, such as developing relevant legislation and standards, offering tax breaks. Under the above three categories, the CCUS policies were further subdivided into nine subtypes, the explanation and examples of which are listed in Tab.1. As existing policy terms that belong to demand-type were not found, further subdivision was not conducted and relevant policies were not listed under this category.

Dimension Y: involved technology procedure. The most general classification was adopted, which divides CCUS into four technology links, including CO₂ capture, transport, chemical and biological utilization, geological use and storage, and technology integration [31]. Some analysis units mentioned CCUS as a whole and did not refer to specific technical procedure, in which case such analysis units were put in “unspecified technical procedure”.

Dimension Z: involved industries. Industries specifically mentioned in analysis units were used as dimension Z, including the power sector, chemical industry, cement production, steel manufacturing, resource exploitation, and light industry. Some analysis units did not refer to specific industries, in which case, such units were put in “unspecified industry”.

After the determination of three dimensions, analysis units were coded by putting each of them into corresponding category according to its policy objective, involved technical procedure, and industry.

3 Policy review

3.1 Temporal trend

Since the first national CCUS-related policy was issued in 2006, the development of CCUS policies has experienced four different periods, which can be partly reflected in the rises and falls of policy number in different periods (Fig.1).

The first stage is the 11th Five-Year Plan (FYP) when the Chinese government started to turn its attention to the CCUS technology. Since the Millennium, the CO₂ emission has grown dramatically in China, which surpassed the US in 2006 as the largest emitter. The internal demand to reduce emissions and external political pressures make China begin to look at greenhouse gas control technologies. Meanwhile, the first CCUS demonstration project in China, a CO₂-enhanced coalbed methane project in Shanxi Province, started in 2004 and achieved great success in the next year [8]. At the same time, IPCC released a special report on CCS, officially proposing the definition of the CCS technology for the first time [32]. The success of the domestic demonstration project and growing international interests probably aroused China’s interest in CCUS. In Feb. 2006, the State Council issued the Outline of National Medium and Long-term Science and Technology Development Plan (2006–2020), which was the first national policy that involved CCUS in China. This outline proposed to focus on research and development of the emission control, disposal and utilization technology of greenhouse gases such as carbon dioxide and methane in major industries. Following this outline, the State Council and the Ministry of Science and Technology (MOST) issued another three documents of national programs and action plans in 2007 and 2008 to combat climate change (Policy 2–4 in Table S1). The policies issued in this period mainly focused on promoting the technology research and development.

In the 12th FYP, CCUS-related policies entered a fast-growing period, during which 20 relevant national policies were issued by the State Council and six other ministries and commissions. In spite of a relatively large number of policies released, what is remarkable is that four CCUS-specific policies were issued in this period for the first time, including two notices by the National Development and Reform Commission (NDRC) and the Ministry of Ecological Environment (MEE), a CCUS roadmap, and a CCUS development plan by MOST. Among these documents, the National Science and Technology Development Plan on CCUS during the 12th FYP, issued by MOST in 2013, is so far the only special plan on CCUS development. This plan comprehensively stated the development level of CCUS technologies at that time, clarified the key tasks and development goals for the 12th FYP, and proposed supporting measures for future development. This plan covered all technical links of CCUS, including CO₂ capture, transport, utilization and storage, and involved multiple policy objectives such as technology research and development, legislation and standards, potential and risk evaluation, platform construction and talent cultivation, etc.

In the 13th FYP, the CCUS policy framework was at a relatively slow stage of development before the proposal of carbon neutrality target. There were 12 national policies issued during this period, seven of which were issued in 2016, as CCUS was mostly mentioned in planning policies that usually issued at the beginning of a FYP. It is worth mentioning that the CCUS standard system made significant progress in this stage, as two national standards specific for CCUS were issued for the first time. One was the Technical Guideline on Environmental Risk Assessment for Carbon Dioxide Capture, Utilization and Storage (on Trial), issued by MEE, the other was the Design Standard for Flue Gas Carbon Dioxide Capture and Purification Engineering, issued by the Ministry of Housing and Urban-Rural Development (MOHURD).

In Sept. 2020, China proposed to achieve carbon neutrality by 2060. The development of CCUS policies entered another stage of rapid growth, and 17 policy documents were issued in less than two years since then. In 2021, the CCUS technology was for the first time included in the Outline of the 14th FYP (2021–2025) for Economic and Social Development and the Long-Range Objectives Through the Year 2035, which is the overall blueprint of the economic and social development for the entire country over the next 5 or even 15 years. This demonstrated the growing attention on CCUS in China.

The proposal of carbon neutrality target greatly facilitated the CCUS policy framework, especially in the aspects of application areas, policy tools and future planning in this period. In the aspect of application area, CCUS promotion in industrial sectors received greater attention, as four documents released in 2021 were proposed to promote CCUS research and development in industrial sectors including chemical, cement and steel production (Policies 48, 55, 56, and 59 in Table S1). From the prospective of policy tools, the objectives of policies issued during this period are increasingly diverse. More economic incentive policies are paying attention to CCUS. For example, MEE issued the Guiding Opinion and Pilot Program for Climate Financing, and the People’s Bank of China issued the Green Bond Endorsed Projects Catalogue (2021 Edition). As to future planning, the Implementation Plan for Carbon Peaking in the Industrial Sector has for the first time clarified the development goals of CCUS in the steel and building materials industries by 2030. Encouraged by the carbon neutrality goal and favoring policies, the construction of the first megaton CCUS project started in July 2021 and completed in early 2022.

3.2 Department functions

As reflected in the 59 policy documents analyzed in this study, the ministries and commissions of the Chinese government have different policy concerns, showing their different functions in the field of CCUS (Fig.2). Some policies were issued jointly by multiple departments, in which case, only the department that took the lead in developing the policy was counted in this study. The top four ministries and commissions with the most policy announcements are the State Council, the NDRC, the MOST, and the MEE, which mainly focused on plans of combating climate change and technology innovation.

The State Council was the first department that paid attention to CCUS and promulgated a total of 13 relevant policies since 2006, of which two were jointly issued with the Communist Party of China (CPC) Central Committee. Ten of these documents are development plans or work programs for technological innovation or climate change, two are opinions on carbon neutrality and circular economy, and one is a program for standardization development. In terms of policy objectives, the documents released by the State Council before 2021 mainly focused on the CCUS technology research and development in coal-based industries such as power sectors and coal chemistries. Recently, additional attention has been paid to financing, platform construction, and standard setting in three documents (Policies 46, 47, and 49 in Table S1) released in the autumn of 2021. As to the industries involved, the CCUS demonstration in the iron and steel industry is specially mentioned in the Action Plan for Carbon Dioxide Peaking Before 2030 released in Oct. 2021.

The NDRC is also paying close attention to the development of CCUS by releasing the largest number of relevant policies that add up to 14 documents since 2012. Five documents are strategies or plans focusing on energy production and consumption, especially the coal industry. Five documents are catalogs of low-carbon or new strategic technologies, emphasizing chemical and biological utilization technologies such as the technology of producing extruded board by CO₂ foaming and equipment of CO₂ bioconversion to clean energy. It is worth mentioning that the NDRC released two special notices on CCUS. One is the Notice on Promoting Carbon Capture, Use and Storage Pilot Demonstrations issued in Apr. 2013, and the other is the Notice on Submitting the Information About the Carbon Dioxide Capture, Utilization and Storage (CCUS) Projects in June 2021. The National Energy Administration, which is administered by the NDRC, also released three plans and an opinion related to CCUS. These four documents focused on research and development of CO₂ capture in power plants as well as geological utilization in energy exploitation.

The MOST gave the most comprehensive attention to CCUS by releasing 7 documents including action plans, developing programs, and technology roadmaps. Although the number of documents is less than that of the State Council and the NDRC, the MOST released three special policies on CCUS, including the Roadmap for Carbon Capture, Utilization and Storage Technology Development in China (the 2011 edition and the 2019 edition) and the National Special Plan for Science and Technology Development of Carbon Capture, Utilization and Storage during the 12th FYP. The MOST focused on a wide range of industries and technical links, and thus rarely mentioned specific industries in its policy documents. The objectives of the policies formulated by the MOST are more diverse than those of other ministries and commissions, which covered all the sub-types listed in Tab.1.

The policies promulgated by the MEE emphasized environmental risk assessment and climate financing. In 2013 and 2016, the MEE issued two special policies for CCUS, both focusing on the environmental evaluation of the CCUS technology. Since 2020, the MEE started to shift its focus to technology research and development and climate financing.

Other national policy documents mentioned the CCUS technology from different perspectives as well. As the highest organ of state authority, the National People’s Congress authorized the Outline of the 14th FYP (2021–2025) for Economic and Social Development and the Long-Range Objectives Through the Year 2035 in 2021. This programmatic document of social economic development pointed out to carry out demonstration of major projects such as CCUS in the section of environmental protection and resource conservation projects. The Ministry of Industry and Information Technology (MIIT) released four plans and one opinion related to green development and carbon peaking in industry field, focusing on technology research and development in industrial sectors like cement and chemical production. The Ministry of Natural Resources (MNR) issued two documents related to CCUS, both focusing on geological storage, including technology research and development, storage capacity evaluation, technology cooperation, etc. But these two plans were released in the 12th FYP, and no new documents have been released ever since. The MOHURD issued the Design Standard for Flue Gas Carbon Dioxide Capture and Purification Engineering in 2018, which was one of the only two national CCUS specific standards currently available. The Ministry of Education (MOE) issued a work program on talent cultivation in 2022, to promote CCUS platform construction, talent cultivation and bring in high-level overseas talents. The Catalogue of Projects Supported by Green Bonds (2021 edition), issued by the People’s Bank of China, included the construction and operation of CCUS projects in energy and industry field.

In addition, China and the US signed three joint statements on tackling climate change that emphasized the cooperation on CCUS. In the latest statement, China-US Joint Glasgow Declaration on Enhancing Climate Action in the 2020s, direct air capture (DAC) is for the first time mentioned in national documents.

4 Analysis result and discussion

4.1 Content analysis

4.1.1 Policy objectives

In the 59 policies reviewed in this study, all the terms mentioning CCUS were categorized following the method stated in Section 2.2. Fig.3 shows the proportions of policies with different objectives, demonstrating that degrees of attention given to different policy objectives varies widely. Technology research and development is definitely the key policy concern as a total of 162 analysis units aim at the promotion of technology research and development, accounting for nearly 60% of the total 277 analysis units. Other policy objectives receive much less attention with each accounting for no more than 10%. Policy terms of legislation and standards account for the second largest proportion of only 9.0%. Other policy objectives mostly account for 3.3%–6.5%. Public cognition receives the least attention, as is mentioned by only four policy terms, accounting for 1.4% of the total analysis units.

From the perspective of policy types, supply-type policies accounted for more than three quarters, environment-type policies accounted for only one quarter, and no demand-type policies was promulgated so far.

4.1.2 Technology links and policy objectives

Fig.4 shows the matrix of policy objectives and technology links. About one thirds of the policy terms did not specify the technical procedure involved. In all the technical links, geological utilization and storage received the greatest attention, owing to the profitable enhanced oil recovery (EOR) technology and the most potentially risky part of CCUS, i.e., storage. As the premise and basis in the CCUS whole process, CO₂ capture technologies received the second most attention, followed by chemical and biological utilization, transport, and technology integration in sequence. Most of the policies to promote research and development specified technology links, with emphasis on geological utilization and storage as well as the capture technology. Policies related to potential and risk evaluation and legislation and standards were most concerned with geological use and storage, which contained the riskiest part of the CCUS process. Most of the policies with other objectives did not specify technical links. What is worth noting is that the only two incentive policy terms involving specific technologies relate to utilization technologies, not the most expensive capture technologies.

4.1.3 Involved industries and policy objectives

Fig.5 shows the matrix of involved industries and policy objectives. In general, the current policy framework lacks clarity in terms of industries involved, as more than half (190 analysis units) has not specified the involved industry. Policy terms aiming at technology research and development are relatively specific, as nearly 60% of them specified industries. In all carbon-emitting industries, power sector received the most attention as the largest CO₂ emission sector in China. Chemical industry and resource exploitation, which are not only the source of CO₂ emissions, but also the industry using CO₂, also receive great attention. Relatively few policies involve cement and steel manufacturing. It worths noting that policy terms with some objectives, such as financial incentive and public cognition, specify no industries.

4.2 Comparison with other countries and regions

Several mature policy systems are developed in some countries such as the US, Canada, and Norway, among which the policy adopted varies widely.

4.2.1 The US

The Tax Credit for Carbon Sequestration (Section 45Q), implemented in the US, is recognized as a successful case to promote CCUS development. Section 45Q is first enacted in 2008, provides tax credits of $10/t CO₂ for CO₂ enhanced recovery projects (CO₂-EOR) and $20/t CO₂ for geological storage projects. In 2018, the provision was partially amended to increase the tax credit to $35/t CO₂ for utilization projects and $50/t CO₂ for storage projects. After the 2018 revision, more than eight CCUS projects were initiated in the US in the same year, four of which were apparently driven by Section 45Q [33]. In 2021, Section 45Q was revised again, significantly increasing the maximum tax credit amount and making the credit eligibility distribution system more flexible [34]. In 2022, the US enacted the Inflation Reduction Act (IRA), which increased the tax credit to $60/t CO₂ and $80/t CO₂ for utilization and storage projects using the CO₂ captured from fixed emission sources, respectively. In addition, the IRA added provisions for the DAC technology by setting tax credits at $130/t CO₂ and $180/t CO₂ for utilization and storage projects using the CO₂ captured directly from the air, respectively. Driven by the IRA, CCUS will achieve 200 million tons of CO₂ reductions in the energy and industrial sectors in the US by 2030 [35].

4.2.2 Canada

CCUS was promoted and supported by CO₂ emission standards of coal-fired power plants and policies favoring CCUS in the carbon emission trading market. In July 2015, the Canadian government imposed a performance standard for new coal-fired power plants, limiting their emission levels to less than 420 g/kWh of CO₂ [36]. Therefore, new generating units must be equipped with carbon capture facilities to meet this performance standard. Moreover, Canada has incorporated CCUS projects into its carbon market, and new CCUS projects apply to join each year. Alberta’s carbon market has the largest number of CCUS projects, which rewards CCUS projects twice as much as certified emissions reductions.

4.2.3 Norway

Carbon tax is an important tool to control carbon dioxide emissions. Although carbon tax is not an incentive measure specific for CCUS facilities, it directly or indirectly promotes the deployment of CCUS facilities as well. Nordic countries were early adopters of carbon taxes and pioneers in carbon capture and storage. Norway introduced carbon taxes in 1991 [37], leading to the construction of Sleipner and Snøhvit CCS projects, which have so far sequestrated more than 20 million tonnes of CO₂.

4.3 Discussion

Seen from the above analysis, significant progress has been made since the first policy was issued in 2006. In general, most policies are planning documents, which are formulated from a macroscopic point of view. CCUS-specific policies are relatively few with only eight documents including one special plan, two standards, three notices, and two versions of roadmaps. Specifically, there are different weaknesses in policies with different policy objectives.

4.3.1 Unbalanced supply-type policies

Supply-type policies are emphasized in the current policy framework but shows evident imbalances. First, policy terms that focus on technology research and development far outnumber those focusing on other policy objectives. Although technology research and development deserve the focus of attention at this stage, other aspects such as platform construction, risk and potential assessment are too far behind, which is not conducive to CCUS technology development. Next, in terms of specific technology links, insufficient attention is paid to weak links of CCUS technologies in China such as CO₂ transport, offshore sequestration, and technology integration. CO₂ transport and technology integration are key technologies for development of CCUS clusters and hubs. Offshore sequestration is also essential in the CCUS technology portfolio as there are few suitable storage sites for emission sources in Southeast China. Finally, in the aspect of involved industries, industrial sectors such as steel and cement have not received enough attention of policy. This condition has been improving as three documents have been released by MIIT within this year to promote the technology research and development in steel, cement, and chemical industries.

4.3.2 Inadequate environment-type policies

Compared to supply-type policies, the current policy system lags far behind in environment-type policies. In addition to the limited number of environment-type policy terms, the inadequacy is also reflected in the insufficiency of pertinence and operability, especially legislations, standards, and incentives.

In terms of legislation and standards, policy provisions are mostly specific on technical links but ambiguous on the involved industries. As the whole-process of a CCUS project involves several technical links and multiple industries, collaboration between stake-holders calls for a clear and comprehensive system of legislation and standards, such as technical standards for retrofitting powerplants in service, pipeline design and safety standards, approval mechanism for CCUS projects, provisions on protection and risk control of CO₂ stored underground, etc. These are not incorporated in the existing policy standards.

Financial incentives are vitally important given the high costs of the CCUS technology at the current stage. Relevant policy provisions hardly mention specific technical links or industries regardless of cost differences. Only one term in Technology Development Roadmap on Carbon Capture, Utilization and Storage in China (2019 edition) suggested to offer equivalent financial support to CCUS utilization technologies as renewable energies. There are no specific policies that propose to offer financial support to CO₂ capture, which is the most expensive part in the whole technology chain. The effective incentive scheme has yet to be formed for the CCUS technology in China.

4.3.3 Absent demand-type policies

Seen from the analysis in Section 4.1, demand-type policies are currently absent in the existing policy system. On the one hand, the support of supply-type policies is imperative to the CCUS technology, especially when technology maturity is limited. On the other hand, most technologies of CCUS have been demonstrated at present, and some has reached the level of commercial application. However, there is little demand of carbon capture retrofit of the existing CO₂ emission sources even in the context of carbon neutrality, given the relatively high construction and operation cost, and the lack of carbon emission standards. Therefore, more demand-type policies are needed to drive the application of CCUS technologies.

5 Conclusion and outlook

This study reviewed 59 CCUS-related policy documents promulgated by the Chinese government as of July 2022. As the goal of carbon neutrality was proposed in China, CCUS received increasing attention in the ‘1 + N’ climate policy system, and its own policy framework has been taking an embryonic form. The policy objectives have evolved from single technology research and development at the beginning to various aspects such as incentives, talent cultivation, standards, etc., and the policy increasingly focused on the industrial sectors that are hard to reduce emissions such as cement and steel manufacturing, rather than a general scope of industry or just the power sector.

However, there is still a long way to go to build a mature and effective policy system for CCUS commercialization. The biggest issue is that environment-type and demand-type policies are obviously insufficient. This is partly because most current policies tend to treat all CCUS technologies as a whole at the stage of demonstration and fail to implement policies for different categories. In fact, CCUS is a technology system that encompasses a wide variety of technologies at greatly different development stages, and thus relative policies need to be tailored according to the needs of each specific technology. Therefore, the following issues may need to be considered.

Environment-type policies were usually implemented sequentially following support-type policies with the gradual maturity of technologies. Therefore, establishing effective incentives or including CCUS into the emissions trading scheme would be the top priority for technologies with high maturity level such as leaching mining and CO₂-EOR. However, a scientific system of CO₂ emissions accounting is the premise of weather incentives or emission trading, which also lags behind and urgently needs to be improved. Before the establishment of incentives or CO₂ emissions accounting system, direct subsidies may be a substitute. The policies supporting the development of the photovoltaic (PV) technology could be a useful reference for CCUS [2]. For example, the Japanese government launched the Sunshine Project in 1970s to promote the technology research and development, and then subsidized 0.8 GW in the Rooftop Project to stimulate the market after 2000. Although technology progress was the primary driving force, the expansion of market size with policy support was the main reason for cost reduction of the PV technology after 2001. In China, the government has already subsidized CCUS projects by allocating extra generating hours to the power plants equipped with CO₂ capture devices and reducing windfall taxes for some CO₂-EOR projects. These subsidies need to be expanded to a wider range of CCUS projects.

Demand-type policies are also essential for some technologies with high maturity level such as CO₂ capture technologies using physical and chemical absorption methods. Government procurement is one way to increase demand. In 1980s, the US government once procured 400 kW to stimulate demand for solar power. Besides, taking a page from the Canadian government, CO₂ emission standards may be set up for large emission sources like thermal power plants to drive the demand of carbon capture technologies. In China, Guidelines for Accounting Methods and Reporting of Corporate Greenhouse Gas Emissions for Power Generation Facilities (2022 revised edition) was released to adjust the emission factor of the national power grid from 610 g/kWh of CO₂ in 2021 to 581 g/kWh of CO₂ in 2022. However, this is only used for CO₂ emissions accounting, not a carbon emission quota constraint. Besides, international cooperation may also create technical demand by conducting cooperation with countries where there are support policies and advanced technologies with little storage capacity like Japan and Singapore.

Furthermore, it is also essential to evaluate the effect of policy implementation. The effects of the amendment of Section 45Q in 2018 and the IRA enacted in 2021 were projected by several organizations and research projects [33,35,38]. Although post-policy assessment is conducted in China for Technical Guideline for Environmental Risk Assessment of Carbon Dioxide Capture, Utilization and Storage (Trial) [10], few studies have been conducted in relevant field. Relative assessment and method research are also important directions of future research for CCUS policy study.

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