Norway opens the world’s first commercial carbon storage facility

A consortium of oil companies, supported by the Norwegian government, has launched a groundbreaking carbon dioxide (CO₂) storage project known as Northern Lights. The initiative aims to capture CO₂ emissions from industrial sources across Europe and store them deep below the seabed in geological reservoirs. This marks a major development in the global push to reduce greenhouse gas emissions.

The project is part of Norway’s long-term climate strategy, designed to store liquefied carbon instead of allowing it to escape into the atmosphere, where it would contribute to global warming. Yet, while its supporters are hailing it as a pivotal tool in combating climate change, others are more skeptical.

Carbon Capture

Carbon Capture and Storage (CCS) technology is one of the few practical methods of reducing emissions from some of the world’s most polluting industries. It works by capturing CO₂ directly from the source — typically industrial plants or power stations burning fossil fuels. Once captured, the CO₂ is compressed, liquefied, and transported to a storage site. From here it can be injected deep underground, often into depleted oil and gas fields or other geological formations.

The idea is simple: prevent carbon dioxide from reaching the atmosphere where it contributes to climate change. CCS is especially important because many industrial sectors — such as cement, steel, and chemical production — will remain reliant on fossil fuels for years. Even as renewable energy sources like wind and solar power expand there will be a delay. So, while these sectors transition, CCS offers a means of reducing their carbon footprints without halting their operations entirely.

In theory, CCS presents a win-win scenario: it reduces industrial emissions and keeps global supply chains humming. But reality, as always, is more complex.

Norway’s gamble

Norway, Europe’s largest oil producer after Russia, is betting heavily on CCS technology as part of its climate strategy. The government has supported 80% of the bill for the Northern Lights project, which remains highly subsidized in its early stages.

The first phase of the project can store 1.5 million tons of CO₂ annually. And a second phase, set to launch in the coming years, should increase capacity by an additional 5 million tons.

The Northern Lights facility has already been fully booked by customers in Norway and continental Europe, who are eager to sequester their carbon emissions. Other CCS projects across Europe are also springing up, particularly in the North Sea, where depleted oil fields offer prime locations for storing captured CO₂. The extensive network of pipelines already in place makes it relatively easy to transport the gas for injection into geological formations.

But while the storage capacity of such projects is promising, the underlying economics of CCS remain murky.

The economic case for CCS

Despite its potential to reduce emissions, CCS is expensive. The technology is far more difficult and costly to deploy compared to other climate initiatives, like wind or solar energy. For now, the industry depends heavily on government subsidies and incentives, such as those offered by Norway.

One of the major drivers behind the adoption of CCS in Europe is the region’s carbon credit system. The European Union operates a cap-and-trade scheme, known as the Emissions Trading System (ETS), which puts a price on carbon emissions. Companies are allocated a certain number of carbon credits, representing the right to emit a specific amount of CO₂. If they exceed this limit, they must purchase additional credits, which can become increasingly costly as governments tighten emissions regulations.

For industries like cement, steel, and chemicals — where reducing emissions is particularly challenging — CCS offers a way to meet regulatory requirements without purchasing additional credits. In some cases, companies may even be able to sell surplus credits if they can capture enough of their emissions. It, therefore, provides a potential revenue stream that offsets some of the cost of the technology.

However, without these carbon markets and subsidies, CCS would likely be financially unviable for most companies. Furthermore, critics argue that the technology is simply a stopgap measure, allowing industries to continue polluting while avoiding the more difficult and costly work of transitioning to greener alternatives.

In fact, some see it as simply counterproductive.

Is this greenwashing?

Not everyone is convinced this is a good idea.

The controversy surrounding CCS largely hinges on whether it represents a genuine effort to tackle climate change or a form of greenwashing. “Greenwashing” refers to any attempt by companies to appear environmentally friendly without making significant changes to their underlying practices. The fact that this project is largely supported by oil companies is already reason enough to be skeptical, given the long-term disinformation practices many such companies have engaged with in previous decades.

Critics argue that CCS allows industries to continue emitting vast amounts of CO₂. They only need to capture a fraction of their emissions to meet regulatory requirements. For example, while the Northern Lights project is impressive in scale, the 1.5 million tons of CO₂ it can store annually is a drop in the ocean compared to the 33 billion tons of CO₂ the world emits each year. Even for Norway, it’s only around 4% of the country’s CO₂ emissions.

Moreover, CCS does nothing to reduce the demand for fossil fuels, which remain a major driver of global emissions. By providing a way for oil and gas companies to continue extracting and selling fossil fuels while capturing some of the resulting emissions, the technology arguably delays the shift toward cleaner energy sources. As a result, some environmentalists view it as a distraction from the urgent need to decarbonize the global economy.

“Northern Lights is ‘greenwashing’,” said the head of Greenpeace Norway, Frode Pleym, noting that the project was run by oil companies.

“Their goal is to be able to continue pumping oil and gas. CCS, the electrification of platforms and all of these kinds of measures are used by the oil industry in a cynical way to avoid doing anything about their enormous emissions,” he said.

What does this mean for climate change?

For now, not so much. It could be a turning point. We could be looking at this as a historic moment a century from now. But the main requirement at the moment is emitting less, not storing carbon dioxide.

Ultimately, the success of CCS will depend on whether we can scale it up quickly and cost-effectively. As governments around the world tighten regulations and the price of carbon rises, the economic case for CCS may improve. But, for now, the technology remains a costly and non-essential piece of the climate puzzle.

Yet Norway’s experiment in carbon capture will serve as an important test site for this technology. In the following years, we’ll soon see whether this this technology can live up to its promise — or whether it’s a costly distraction from the deeper changes needed to address the climate crisis.