For SPIN members who capture CO₂ and turn it into fuel, the demand is simple: the avoided emission must be creditable twice – to the industrial source that captures the carbon and to the e-fuel that recycles it – because only then do both ends of the chain have a reason to invest, and only then can carbon capture be scaled up at all.
Big news! An upcoming EU’s ETS revision does not grant that double recognition yet, but it clears the obstacle that stood in front of it: the exclusion of e-fuels made from industrial CO₂ outside Europe, which until now has kept most of the world’s cheapest renewable electricity out of the carbon loop. Two documents published within weeks of each other show how far apart Bern and Brussels now are on this question. On 2 September 2026, the Swiss Federal Council adopted its report on synthetic energy carriers and seasonal storage. In its overview table, synthetic methane, methanol and hydrocarbons are labelled CO₂-neutral only if the carbon comes from biogenic or atmospheric sources. Industrial CO₂ – from a cement kiln, a steelworks, a waste-to-energy plant – does not qualify.
In Brussels, the Commission’s proposal to revise the Emissions Trading System goes the other way. Buried in the technical provisions is a change in how the fossil carbon content of e-fuels is accounted for: no longer upstream, where the CO₂ is emitted and captured, but midstream, where the finished fuel is placed on the market. It sounds like bookkeeping. It is in fact the key that unlocks industrial CO₂ as a feedstock for the imported e-fuels Europe will need.
The problem the EU is trying to solve
Under the EU’s RFNBO rules – the delegated acts adopted under the Renewable Energy Directive – industrial CO₂ is already an accepted carbon source for renewable fuels of non-biological origin, for a transition period that runs to 2041 for CO₂ from installations covered by the ETS and to 2036 for other fossil combustion sources. There is one condition: the CO₂ must have been subject to «effective carbon pricing». The logic is sound. If the emitter has paid for the carbon, the fuel producer can recycle it without the climate benefit being counted twice.
The condition works inside Europe, where the ETS puts a price on industrial emissions. It does not work in Chile, Namibia, Morocco or Oman – precisely the regions with the cheap renewable electricity that makes e-fuels affordable. A Patagonian e-fuel plant that captures CO₂ from a local cement works cannot prove effective carbon pricing, because there is none. Its product is excluded from the EU market as an RFNBO, even though the carbon it contains would otherwise have gone straight into the atmosphere and without using it even more carbon would have been released; because every recycled carbon atom replaces a fossil atom and prevents additional emissions. Project developers have been pointing to this barrier for years, and it is one reason why so many announced e-fuel plants have not reached a final investment decision.
What midstream accounting changes
If the fossil carbon in an e-fuel is priced when the fuel is distributed in the EU, rather than when the CO₂ left the chimney, the «effective carbon pricing» test is passed by construction – wherever the CO₂ was captured. Industry associations that sought clarification from the Commission on this point report that the Commission sees the midstream approach as a pathway to resolve the effective-carbon-pricing problem for fuels produced outside the EU, and that DG Energy would adjust the RED delegated acts accordingly if the ETS revision concludes with midstream accounting. The proposal is still in the ordinary legislative procedure; the European Parliament’s committees are tabling amendments this autumn, with a plenary vote planned for December.
Two things are worth noting about what this does and does not do. It does not declare e-fuels from industrial CO₂ to be climate-neutral: the fossil carbon they contain still carries a price. What it does is count that carbon exactly once, at the point of use, instead of making the fuel ineligible because the price was not paid at the point of capture. That is the pragmatic middle ground between «any CO₂ will do» and «only direct air capture counts».
Why this matters for Switzerland
The Federal Council’s report is candid about one thing: a substantial share of Switzerland’s future demand for synthetic energy carriers will have to be imported, because domestic renewable electricity will not suffice to produce them economically at scale. It is equally candid that the narrow carbon-source definition is a cost driver, noting that capturing CO₂ from biogenic and atmospheric sources is expensive and energy-intensive and that such sources are limited.
Put the two together and the contradiction is plain. Switzerland says it will depend on imports. The EU is building the accounting framework that makes e-fuels from industrial CO₂ importable. If Swiss rules continue to recognise only biogenic and atmospheric carbon, Switzerland excludes itself from exactly the supply the EU is about to admit – and narrows its own security of supply by choice. A country that cannot produce enough synthetic fuel at home cannot afford a stricter feedstock definition than the market it imports from.
SPIN’s position on carbon sources has been consistent, and it is the one the EU is now operationalising. One condition remains non-negotiable from a Power-to-X perspective: synthetic fuels only make climate sense when the carbon they contain is recycled CO₂ from biogenic, atmospheric or industrial sources, and when that recycling displaces fossil carbon instead of providing a reason to burn more of it. A long transition period for industrial sources is defensible as long as using their carbon creates no incentive to keep extracting fossil feedstocks. Where those industrial sources themselves increasingly run on recycled carbon, the loop closes – and they should remain eligible.
What SPIN asks of Bern
- Align the carbon-source definition with the EU. Recognise recycled CO₂ from biogenic, atmospheric and industrial sources in Swiss ordinances, with the same transition periods the EU applies, so that Swiss importers and producers work to one standard, not two.
- Follow the ETS debate, not just the headline. If the EU adopts midstream accounting, Swiss carbon accounting rules for imported synthetic fuels should be updated in step, so that fuels eligible in the EU are eligible in Switzerland on the day they cross the border.
- Stop treating the feedstock question as a footnote. The Federal Council’s own report shows that the narrow definition raises costs and limits supply. The Energy Perspectives 2060 now in preparation are the place to correct this.
The irony is hard to miss. Switzerland’s Parliament wrote renewable and synthetic fuels into the CO₂ Act years before the EU had comparable instruments. On the carbon source, however, the ordinance-level thinking in Bern is now more restrictive than Brussels. Switzerland is strong at the level of its laws and blocked at the level of its ordinances. The ETS revision is a timely reminder of what that costs.
Sources: European Commission, proposal for a revision of the EU ETS, COM(2026) 616; European Parliament ENVI Committee, draft report on the ETS revision; Swiss Federal Council, report on synthetic energy carriers and seasonal energy storage, 2 September 2026; Hydrogen Europe, industry letter on binding RFNBO targets.
H2 Forum 2026 – 14 October, Konstanz
How can the hydrogen market ramp-up succeed in the trinational Lake Constance and Upper Rhine region? The H2 Forum 2026 of the Trinational Hydrogen Initiative 3H2 brings together politics, industry and infrastructure operators at the Bodenseeforum in Konstanz on 14 October 2026 – with panels, workshops and practical examples from across the region.
🤖 AI transparency: This text and its visual were created using AI, reviewed and approved by a human.