Evolution of Economic Regulation for CO2 Storage

To maintain investment and continue development of CO2 stores, we would like to consider whether alternative forms of economic regulation for CO2 storage are appropriate as the market transitions towards a self-sustaining market. This call for evidence investigates whether the Regulated Asset Base (RAB) 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 supporting the UK’s Carbon Budgets and net zero. We are seeking views and evidence on elements of economic regulatory regime for CO2 storage in these key areas: 1. Economic Regulation and Natural Monopolies 2. Competition and Storage Costs 3. Investment: Equity and Debt Considerations Following the call for evidence closing, government and Ofgem will assess the responses received