As stated by the EBRD, the general objective of this Project is to support Croatia in designing a comprehensive policy framework and mapping of suitable sites for CCUS project, which could encourage investment in CCUS.The key objectives of this Project are to:

• Review and conduct a gap analysis of the existing policy framework for CCUS;
• Provide recommendations for the CCUS development, considering technical, economic and environmental and social (E&S) considerations. This will include an interactive map of Croatia identifying optimal sites for CO2 storage, existing and potential pipeline routes, locations of CO2 emitters and users;
• Prepare a Roadmap for CCUS development in Croatia with a step-by-step action plan for the development of CO2 management potential in Croatia.

Croatia is committed to the EU's climate targets, aiming for climate neutrality by 2050 and a reduction of net greenhouse gas emissions by at least 55% by 2030 (compared to 1990 levels). These legally binding targets are enshrined in the European Climate Law.

Croatia is committed to the EU's climate targets, aiming for climate neutrality by 2050 and a reduction of net greenhouse gas emissions by at least 55% by 2030 (compared to 1990 levels). These legally binding targets are enshrined in the European Climate Law. The Commission Communication on the EU's climate target for 2040 highlighted the need for 450 million tonnes of CO2 per year to be captured and stored or utilised by 2050. The EU's policies include strengthening incentives for Carbon Capture, Utilisation and Storage (CCUS) through the revision of the EU Emissions Trading System (ETS) and supporting the development of CO2 transport and storage infrastructure as part of the Trans-European Networks for Energy (TEN-E) Regulation. Furthermore, the Directive on the Geological Storage of Carbon Dioxide provides a regulatory framework for the storage of CO2. The EU Industrial Carbon Management Strategy outlines the role of CCUS in decarbonizing hard-to-abate sectors, setting targets for CO2 capture and storage infrastructure. The Net-Zero Industry Act (NZIA) aims to accelerate CCUS deployment by streamlining permitting, supporting CO2 transport networks, and ensuring a strategic approach to CO2 storage development. Together, these initiatives position CCUS as a key tool for reducing industrial emissions and enhancing the EU's green competitiveness.

Croatia's updated National Energy and Climate Plan (NECP) 2021-2030 recognizes the importance of CCUS in reducing industrial emissions, particularly for cement, steel, and hydrogen production. However, despite its potential, the deployment of CCUS in Croatia remains at an early stage due to the absence of a comprehensive regulatory framework. The lack of clear permitting procedures, regulatory guidelines, and incentive mechanisms poses a major barrier to investment in CCUS infrastructure. Additionally, Croatia has yet to establish a national strategy for CO2 transport and storage, which is essential for the scaling up of CCUS projects.

Croatia's Low Carbon Development Strategy Document envisions CO2 storage projects starting by 2030 and scaling up by 2050, requires the establishment of a comprehensive regulatory and legal framework governing the full lifecycle of CCUS projects. This includes defining site selection criteria, permitting processes, liability provisions, and financial incentives for CO2 capture, transport, and storage infrastructure. Without such a framework, Croatia risks falling behind in the deployment of CCUS technologies and missing its emissions reduction commitments.

As a result, the Croatian Hydrocarbon Agency (Agencija za ugljikovodike) ("Agency" or "CHA") and the Croatian Ministry of Economy (Ministarstvo gospodarstva) ("Ministry") have requested EBRD's support to improve the policy framework for CCUS through the Technical Support Instrument of SG REFORM. This Project will pave the way for CCUS development.

Information on investment amount not provided at the time of disclosure.

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