The European Commission is considering the introduction of national targets for carbon removals as part of a major climate and energy legislative package due by the end of the year, a senior official said on September 11. If the idea survives into the final proposal, it would mark a structural shift for the carbon removal market in Europe: from a voluntary certification framework that rewards early movers to a system of member-state obligations that manufactures demand. For CDR developers, investors and credit buyers, this is the single most consequential policy signal to emerge from Brussels this quarter.

What Is Actually on the Table

The package in question is the EU’s post-2030 climate implementation framework, expected in the fourth quarter of 2026. According to Carbon Gap’s policy tracker, it will include legislative revisions to national targets and flexibilities under the EU climate architecture, notably the Land Use, Land Use Change and Forestry (LULUCF) Regulation and the Effort-Sharing Regulation, in line with the Commission’s 2026 work programme.

The design work has been running all year. A public consultation on the post-2030 implementation package was open from February 9 to May 4, 2026, gathering stakeholder input specifically on the design of national targets and the flexibilities that would help member states deliver the EU’s 2040 climate target. National carbon removal targets would slot into exactly this architecture: an EU-level objective for removals, disaggregated into per-country goals, with accounting rules to match.

Two questions remain open, and neither has a public answer yet. The first is scope: whether the targets would cover only land-based removals, where the EU already has a template, or extend to permanent, engineered removals such as direct air capture with storage and bioenergy with carbon capture and storage. The second is legal force: whether targets would be binding on member states or indicative. The difference between those two options is the difference between a policy nudge and a compliance market.

The Architecture Brussels Has Already Built

National removal targets would not land in a vacuum. Three load-bearing pieces of EU climate law are already in place.

First, the 2040 climate target itself. The amended EU Climate Law, in force since April 7, 2026, sets a legally binding goal of a 90% net reduction in greenhouse gas emissions by 2040 compared to 1990 levels. At least 85% must come from domestic reductions, with up to 5% allowed from high-quality international carbon credits. The framework also provides for the integration of domestic permanent carbon removals into the EU Emissions Trading System, the demand-side lever the CDR sector has been requesting for years.

Second, the certification layer. The Carbon Removals and Carbon Farming (CRCF) Regulation created the EU’s first voluntary certification framework for removals, and the Commission adopted a first set of certification methodologies in early 2026, with schemes able to apply for recognition. Certification without demand is a certificate without a buyer, which is precisely the gap national targets would close.

Third, the precedent. The revised LULUCF Regulation already sets a binding EU-wide target of 310 million tonnes of CO2 equivalent in net removals from the land sector by 2030, disaggregated into binding member-state targets. Extending that logic to a broader removals target, or to a post-2030 horizon, is an evolution of existing law rather than a conceptual leap.

Why National Targets Would Change the Demand Equation

The European CDR market’s core problem is not certification or technology. It is the absence of a buyer of last resort. Voluntary demand is real but thin relative to what climate models require: the Commission’s own impact assessment for the 2040 target estimated that around 80 million tonnes of industrial CO2 removals per year would be needed by 2040 to stay on course toward climate neutrality.

National targets attack that problem directly. A member state with a binding removals obligation becomes a predictable, credit-worthy counterparty. Governments can meet such targets through public procurement, contracts for difference, reverse auctions or regulated demand on domestic industries, and each of those instruments converts policy ambition into bankable revenue for project developers. The experience of renewable energy two decades ago is instructive: feed-in obligations on member states did more to build the wind and solar industries than any voluntary corporate commitment.

There is also a portfolio effect. National targets would create demand for a ladder of removal types, from lower-cost carbon farming and LULUCF removals to high-cost permanent storage, because countries would optimise for cost across the whole removals menu rather than cherry-picking one category.

Implications for Developers, Investors and Buyers

For project developers, the signal is to treat EU policy certainty as an underwriting input, not a tail risk. Projects sited in the EU with CRCF-eligible methodologies and clear storage permanence would sit closest to future compliance demand. Engineering and permitting lead times for geological storage mean that capacity decisions taken in 2026 and 2027 will determine who can deliver when targets bite.

For investors, national targets would re-rate the risk profile of European CDR. Revenue backed by member-state obligations is categorically different from revenue backed by voluntary offtakes, and it would likely compress the cost of capital for storage infrastructure in particular. The countervailing risk is political: targets negotiated under competitiveness pressure may arrive with generous flexibilities that dilute near-term demand.

For credit buyers, the read-across is price. If Brussels builds public demand for permanent removals, the era of cheap European CDR supply ends. Buyers with net zero commitments that anticipate using removals in the 2030s have an economic case for locking in offtakes before compliance demand is legislated, a pattern already visible in forward markets.

What to Watch

Three markers will clarify the trajectory before year-end. First, the published package itself: whether national removal targets appear as a proposal or only as a recital, and whether they cover permanent removals or only land sinks. Second, the ETS revision track, where the integration of domestic permanent removals would create the demand-side counterpart to any national target. Third, the treatment of the LULUCF and Effort-Sharing revisions, which will reveal how much flexibility member states can extract. The direction of travel is no longer in doubt. What the fourth quarter will decide is its speed, and its binding force.