Evaluating models of CO2 transport governance : from state-led to market-based approaches

Large-scale CO2 transport infrastructure is crucial for achieving decarbonization goals, yet its deployment remains slow. This paper maps emerging CO2 transport governance models across two dimensions: State-led policies and Economic Regulation. It analyzes how countries combine these measures to advance infrastructure development. We identify four dominant governance categories: (1) State-led, characterized by strong public involvement through ownership or large-scale support; (2) Regulatory-based, focused on establishing robust economic regulation for transport and storage; (3) Hybrid, blending mature regulation with targeted early-state intervention; and (4) Market-based, relying primarily on private initiative. Our analysis reveals a trade-off between CO2 governance models and Final Investment Decisions (FIDs). State-led countries have secured FIDs for flagship projects, while Regulatory-based countries (excluding the EU) have not. State-led countries more easily overcome the early-stage chicken-and-egg problem, whereas Regulatory-based countries offer a clearer long-term regulatory framework. We also highlight that most Regulatory-based countries lack domestic storage capacity, partly explaining their slower investment progress. Lastly, we note that expropriation powers are emerging as a policy tool to accelerate the development of CO2 transport.