Competition Law and Competition Implications of Climate-Engineering Markets

1. Introduction

Climate engineering, often called geoengineering, refers to technologies designed to deliberately intervene in the climate system to reduce atmospheric greenhouse gases, remove carbon dioxide, alter radiative forcing, or otherwise influence climate conditions.

The emerging climate-engineering market may include:

• Carbon capture, utilisation and storage (CCUS/CCS);
• Direct air capture (DAC);
• Enhanced weathering and mineralisation;
• Ocean alkalinity enhancement;
• Bioenergy with carbon capture and storage (BECCS);
• Solar radiation modification (SRM);
• Artificial-cloud or atmospheric interventions;
• Large-scale afforestation and engineered carbon removal;
• Carbon-removal measurement, reporting and verification (MRV);
• Carbon-credit certification and registries;
• CO₂ transport and storage infrastructure;
• Climate-engineering software, modelling and satellite-data systems.

Competition law becomes important because these markets can develop around scarce geological storage sites, proprietary technology, patents, data, government subsidies, carbon-removal standards, infrastructure networks and long-term corporate offtake contracts.

There is not yet a substantial body of reported competition-law jurisprudence specifically concerning "climate-engineering markets." Consequently, established competition cases concerning essential facilities, technological ecosystems, intellectual property, network effects, tying, mergers, infrastructure access, information exchange and sustainability agreements provide the principal legal analogies.

2. Why Climate Engineering Creates Distinct Competition Concerns

Climate engineering differs from conventional markets because the market may be simultaneously dependent upon:

1. Highly specialised technology;
2. Large capital requirements;
3. Government subsidies and contracts;
4. Scarce natural resources;
5. Scientific data and measurement methodologies;
6. Intellectual-property portfolios;
7. Certification and verification systems;
8. Transport and storage infrastructure;
9. Long-term carbon-removal purchase agreements;
10. Regulatory approvals.

Thus, competition problems may occur at several levels.

Climate-engineering value chain

Technology → Equipment → Feedstock → Capture/Removal → Transport → Storage → Measurement → Certification → Carbon credits → Corporate purchasers

Dominance at one level can therefore create leverage over adjacent markets.

3. Relevant Competition-Law Framework

A. Abuse of Dominant Position

A climate-engineering undertaking could become dominant because it controls:

• A patented DAC technology;
• A unique mineralisation process;
• A geological CO₂ storage basin;
• A CO₂ pipeline network;
• A verification methodology;
• A major carbon-credit registry;
• Essential climate datasets;
• Specialised atmospheric modelling software.

Potential abuses include:

• Refusal to supply;
• Discriminatory access;
• Excessive pricing;
• Predatory pricing;
• Exclusivity;
• Tying and bundling;
• Self-preferencing;
• Loyalty rebates;
• Discriminatory licensing;
• Restrictive interoperability conditions.

4. Essential-Facility Problems

Some climate-engineering infrastructure may have characteristics of an essential facility.

Examples include:

• CO₂ pipelines;
• Deep geological storage sites;
• Ports for CO₂ transportation;
• Specialised capture terminals;
• National climate-data platforms;
• Carbon-removal certification infrastructure.

If one undertaking controls infrastructure that competitors cannot reasonably duplicate, competition law may require careful examination of access restrictions.

The leading European principle comes from Bronner, where the Court imposed a demanding threshold for compulsory access to infrastructure. The doctrine is particularly relevant because forcing access can itself reduce investment incentives.

5. Case Law 1 — Oscar Bronner GmbH v Mediaprint

Principle

The Bronner judgment established important principles concerning refusal to supply and essential facilities.

The Court indicated that compulsory access requires exceptional circumstances, including circumstances in which the facility is indispensable and duplication is not realistically possible.

Application to climate engineering

Suppose Company A owns the only economically viable geological formation capable of permanently storing millions of tonnes of CO₂.

Company A could attempt to prevent competing carbon-removal firms from using that storage facility.

Competition authorities would need to consider:

• Is the storage site genuinely indispensable?
• Can another geological site reasonably be developed?
• Are alternative storage technologies available?
• Would access obligations undermine investment?
• Is the refusal eliminating effective competition?

Importance

The case establishes a framework for balancing:

Infrastructure access vs. investment incentives.

This could become one of the most important competition-law issues in future CCS markets.

6. Case Law 2 — IMS Health GmbH & Co OHG v NDC Health

Principle

The IMS Health litigation concerned access to a commercially important information structure protected by intellectual property.

The Court recognised that intellectual-property rights do not automatically prevent competition-law intervention, but compulsory licensing requires exceptional circumstances.

Climate-engineering application

A climate-engineering company might own:

• A proprietary carbon-removal dataset;
• A patented measurement methodology;
• Climate-modelling data;
• Atmospheric simulation software;
• A unique MRV system.

Competitors might argue that access is necessary to compete.

Competition authorities would therefore have to balance:

IP protection + innovation incentives

against

access + effective competition.

Example

If one company owns the dominant carbon-removal verification methodology and refuses to license it, the question would not simply be whether the technology is useful.

The legal inquiry would examine whether the technology is genuinely indispensable and whether refusal would eliminate effective competition.

7. Case Law 3 — Microsoft Corp v Commission

Principle

The Microsoft case dealt with leveraging of dominance, interoperability and tying.

The European Commission and EU courts examined Microsoft's conduct involving interoperability information and the integration of products into a dominant technological ecosystem.

Climate-engineering relevance

A climate-engineering platform could become an ecosystem comprising:

• Capture equipment;
• Monitoring software;
• MRV systems;
• Carbon-credit certification;
• Storage booking;
• Carbon-credit trading.

Suppose a dominant platform requires customers to use its own:

capture equipment + monitoring software + certification service + carbon-credit registry.

This could create concerns about:

• Tying;
• Bundling;
• Foreclosure;
• Interoperability restrictions;
• Ecosystem leverage.

The Microsoft principles are therefore highly relevant to digitalised climate-engineering markets.

8. Case Law 4 — Google Shopping

Principle

The Google Shopping litigation concerned the use of dominance in a general search service to favour Google's own comparison-shopping service.

The case illustrates the importance of self-preferencing and leveraging where a dominant platform operates both the infrastructure and a downstream service.

Climate-engineering application

Imagine a dominant carbon-removal marketplace that:

1. Operates the main carbon-removal platform;
2. Certifies projects;
3. Lists projects;
4. Sells carbon-removal credits;
5. Owns several removal projects itself.

It could potentially favour its own projects through:

• Search rankings;
• Certification speed;
• Visibility;
• Data access;
• Transaction fees;
• Algorithmic recommendations.

The competition concern would be particularly strong where competitors depend upon the platform to reach buyers.

9. Case Law 5 — Aéroports de Paris v Commission

Principle

The Aéroports de Paris jurisprudence is important for competition law involving infrastructure and commercial facilities.

It illustrates how an undertaking operating important infrastructure may simultaneously perform economic activities and exercise significant control over access to infrastructure.

Climate-engineering application

Consider a CO₂ transportation hub serving multiple carbon-removal companies.

The operator might control:

• Pipeline connections;
• Storage access;
• Loading facilities;
• Scheduling;
• Measurement infrastructure.

If the infrastructure operator gives preferential treatment to its affiliated carbon-removal business, competition concerns could arise.

Potential issues include:

• Discriminatory access;
• Preferential pricing;
• Cross-subsidisation;
• Exclusive access;
• Capacity allocation;
• Margin squeeze.

10. Case Law 6 — Meca-Medina and Majcen v Commission

Principle

The Meca-Medina judgment is significant because it demonstrates that rules pursuing legitimate non-economic objectives may still fall within competition-law analysis if they produce sufficiently restrictive effects.

The Court developed an approach examining:

• The objectives of the rules;
• Their context;
• Their proportionality;
• Their restrictive effects.

Climate-engineering significance

Climate-engineering companies may cooperate to establish:

• Safety standards;
• Environmental standards;
• Carbon-removal methodologies;
• Scientific protocols;
• Verification requirements.

Such cooperation may generate substantial environmental benefits.

However, competitors cannot automatically use environmental objectives to justify agreements that unnecessarily restrict competition.

Example

Several DAC companies agree:

"No member will sell carbon-removal technology below €500 per tonne."

The agreement may be environmentally motivated, but it also resembles price coordination.

The environmental objective would not automatically immunise the agreement.

11. Case Law 7 — CECED v Commission

Principle

The CECED case is particularly relevant because it involved an agreement concerning energy efficiency.

Manufacturers agreed to phase out certain energy-inefficient products.

The case is important for understanding how environmental benefits can interact with competition law.

Climate-engineering application

Climate-engineering companies might agree to:

• Eliminate particularly carbon-intensive technologies;
• Adopt common environmental standards;
• Establish minimum permanence standards;
• Introduce common safety requirements.

Such agreements may generate environmental benefits.

However, competition authorities must distinguish:

Legitimate cooperation

from

disguised cartelisation.

For example:

Potentially legitimate: common technical safety standards.

Potentially problematic: agreement not to compete on price.

12. Case Law 8 — Eturas v Lietuvos Respublikos Konkurencijos Taryba

Principle

The Eturas case concerned an electronic platform and the possibility of coordinated pricing through a common technological system.

The case illustrates how digital platforms and algorithms can facilitate coordination.

Climate-engineering application

Carbon-removal marketplaces may use algorithms to determine:

• Carbon-credit prices;
• Storage prices;
• Removal capacity;
• Project ranking;
• Buyer allocation.

If competitors use a common algorithm configured to restrict price competition, competition concerns may arise even where there is no traditional face-to-face cartel meeting.

Emerging risk

Algorithmic climate cartel

could involve competing DAC operators submitting information to a common pricing system that automatically reduces competitive pricing.

13. Case Law 9 — United States v Microsoft Corp.

Principle

The US Microsoft litigation addressed monopolisation and exclusionary conduct in technology markets.

The case demonstrates how a company possessing substantial market power can potentially protect its position by restricting technological interoperability or disadvantaging competing technologies.

Climate-engineering relevance

A dominant climate-engineering platform might attempt to lock customers into:

proprietary hardware + proprietary software + proprietary data + proprietary certification.

This could create technological switching costs.

The resulting market structure could make it difficult for innovative competitors to enter.

14. Case Law 10 — United States v AT&T

Principle

The AT&T litigation illustrates competition concerns arising from control over critical communications infrastructure.

Although not a climate-engineering case, its broader significance concerns the relationship between infrastructure control and downstream competition.

Climate-engineering application

The analogy can apply to:

• CO₂ transportation pipelines;
• Storage networks;
• Carbon-removal terminals;
• Specialised measurement infrastructure.

Where infrastructure ownership allows a vertically integrated company to disadvantage downstream competitors, structural and behavioural remedies may become relevant.

15. Merger-Control Concerns

Climate engineering is likely to experience substantial consolidation because many technologies require significant capital.

Potential mergers include:

Horizontal mergers

DAC company + DAC company.

Vertical mergers

CO₂ capture company + pipeline operator.

Conglomerate mergers

Carbon-removal company + carbon-credit exchange + certification company.

Data-driven mergers

Climate-modelling company + satellite-data provider.

Infrastructure mergers

CO₂ transport company + geological storage company.

Competition authorities should therefore examine:

• Market concentration;
• Entry barriers;
• Innovation competition;
• Pipeline/storage access;
• Patent portfolios;
• Data concentration;
• Long-term contracts;
• Carbon-credit market power;
• Potential elimination of future competitors.

16. Killer-Acquisition Concerns

Climate engineering is likely to contain numerous startups developing radically different technologies.

A large incumbent could acquire a startup before its technology becomes commercially significant.

The acquisition might eliminate:

• A potential technological challenger;
• A future substitute;
• A disruptive DAC technology;
• An alternative mineralisation technology.

This is especially relevant where traditional turnover-based merger thresholds fail to capture the economic significance of a startup.

Therefore, authorities may need to consider:

innovation-based theories of harm, not merely current market share.

17. Intellectual Property and Patent Pools

Climate-engineering technologies are likely to depend heavily on patents.

Potentially important technologies include:

• Sorbent materials;
• CO₂ separation;
• Mineralisation;
• Direct-air capture;
• Membrane technologies;
• Geological monitoring;
• Carbon measurement;
• Atmospheric modelling.

Patent pools can reduce transaction costs.

However, a patent pool could become anticompetitive if it:

• Excludes competing technologies;
• Fixes downstream prices;
• Restricts independent innovation;
• Prevents alternative technologies from obtaining licences.

A competition-compliant licensing framework should generally emphasise:

• Transparent licensing;
• FRAND-like principles where appropriate;
• Non-discriminatory access;
• Interoperability;
• Reasonable royalty structures.

18. Data Monopolisation

Climate engineering is increasingly data intensive.

Important datasets may include:

• Atmospheric data;
• Soil data;
• Ocean chemistry;
• Geological data;
• Satellite imagery;
• Carbon-removal performance;
• Weather data;
• Storage capacity data.

A dominant company controlling an indispensable dataset could potentially prevent competitors from developing comparable technologies.

Competition authorities may therefore have to examine:

data ownership + data portability + interoperability + access discrimination.

19. Carbon-Credit Market Power

Carbon-removal markets may depend upon certificates representing verified removal.

If a single organisation controls certification or registry infrastructure, it may acquire substantial gatekeeper power.

Potential concerns include:

• Discriminatory certification;
• Excessive verification fees;
• Preferential treatment;
• Delayed certification of competitors;
• Exclusive registry arrangements;
• Bundling certification with carbon-credit trading.

The market could consequently develop into a structure where:

No certification → no credit → no market access.

That creates an important competition-law issue.

20. Long-Term Offtake Agreements

Large corporations may sign long-term agreements to purchase carbon removals.

These contracts can provide financing for climate-engineering projects.

However, extensive exclusivity could foreclose competitors.

For example:

A major technology company contracts 80% of the available DAC capacity in a geographic market for 20 years.

This may create:

• Foreclosure;
• Input scarcity;
• Capacity reservation;
• Barriers to entry;
• Reduced access for competing purchasers.

Competition analysis would need to consider both:

investment certainty

and

market foreclosure.

21. Predatory Pricing and Subsidy Competition

Climate-engineering technologies may initially have very high costs.

Governments may therefore provide:

• Grants;
• Tax credits;
• Contracts for difference;
• Carbon-removal purchase commitments;
• Low-cost loans;
• Infrastructure subsidies.

Government support can accelerate technological development, but it may also alter competitive conditions.

For example, the EU has recently approved substantial Danish state support for carbon capture and storage. The 2026 EU publication concerning Denmark's CCS Fund records a direct-grant scheme with a total budget of DKK 28.659 billion and an environmental-protection objective.

This demonstrates why state-aid control will be particularly important in climate-engineering markets.

22. State Aid and Competition Neutrality

The competition problem is not necessarily that subsidies exist.

The issue is whether subsidies:

• Favour particular firms;
• Exclude competing technologies;
• Create artificial barriers to entry;
• Distort downstream markets;
• Discriminate among technology providers.

EU state-aid law expressly recognises that environmental objectives may justify certain forms of state support while still requiring examination of competitive effects.

The Danish CCS support framework is therefore an important contemporary example of the intersection between climate policy and competition policy.

23. Cartel Risks

Climate-engineering firms may have legitimate reasons to cooperate.

Examples:

• Research cooperation;
• Safety standards;
• Measurement standards;
• Environmental standards;
• Scientific research.

But cooperation can become problematic where competitors coordinate:

• Prices;
• Output;
• Customers;
• Geographic markets;
• Procurement;
• Investment;
• Capacity.

High-risk example

Ten carbon-removal companies agree:

"We will not offer carbon removal below $300 per tonne."

This is fundamentally different from agreeing on a common scientific safety methodology.

24. Sustainability Agreements

Climate engineering creates a particularly important tension between:

Environmental cooperation

and

Competition restrictions.

A joint climate project may create substantial benefits that competition authorities should recognise.

But firms cannot simply invoke:

"climate protection"

as a general defence for cartel conduct.

The CECED and Meca-Medina lines of jurisprudence demonstrate why authorities need to examine the nature, objective, context, necessity and proportionality of sustainability-related cooperation.

25. Network Effects

Climate-engineering platforms may experience strong network effects.

For example:

More buyers → more removal projects → more data → better verification → more buyers.

This can create a self-reinforcing market.

A platform that reaches critical scale could become difficult for competitors to challenge.

Potential remedies include:

• Data portability;
• Interoperability;
• Non-discriminatory access;
• API access;
• Separation of certification and marketplace functions;
• Restrictions on self-preferencing.

26. Vertical Foreclosure

A climate-engineering conglomerate might control:

Technology → Equipment → CO₂ transport → Storage → Certification → Trading.

Vertical integration is not inherently anticompetitive.

However, problems may arise if the company uses control over one level to disadvantage competitors at another level.

Example

A company operating a CO₂ pipeline could:

• Charge competitors more;
• Reserve capacity for affiliates;
• Delay competitor connections;
• Provide preferential scheduling;
• Refuse interoperability.

This could transform vertical integration into a competition concern.

27. Competition Implications of Solar Radiation Modification

Solar radiation modification presents particularly unusual competition questions.

Possible commercial technologies could involve:

• Aerosol delivery;
• Atmospheric monitoring;
• Climate modelling;
• Satellite systems;
• Reflective materials;
• Weather-control technologies.

Competition law could potentially encounter markets where:

• One company controls specialised atmospheric modelling;
• Another controls delivery infrastructure;
• Governments procure technology from a small group of firms;
• Proprietary data creates technological lock-in.

However, because SRM involves significant scientific, environmental and governance uncertainties, competition analysis must be separated from broader questions of environmental safety and public governance.

28. Geographic Market Definition

Traditional geographic-market analysis may become difficult.

A carbon-removal company might operate:

• Capture technology in one country;
• CO₂ transport across borders;
• Storage in another jurisdiction;
• Certification in a third jurisdiction;
• Carbon-credit sales globally.

Consequently, authorities may need to examine:

• Local infrastructure markets;
• Regional CO₂ networks;
• Global technology markets;
• Cross-border carbon-credit markets.

29. Innovation Competition

Traditional competition analysis often focuses on:

• Price;
• Output;
• Market share.

Climate-engineering markets require greater emphasis on innovation competition.

A company with a small current market share might nevertheless represent an important future competitor because it possesses:

• A superior capture technology;
• Lower energy requirements;
• Greater permanence;
• Better storage technology;
• Cheaper mineralisation;
• More efficient verification.

Consequently:

Loss of innovation competition may occur before conventional market concentration becomes visible.

This makes merger review particularly important.

30. Potential Competition-Law Remedies

Competition authorities could employ several remedies.

Structural remedies

• Divestiture;
• Separation of certification and trading;
• Infrastructure ownership separation.

Behavioural remedies

• Non-discriminatory access;
• FRAND licensing;
• Interoperability;
• Data portability;
• Prohibition of exclusivity;
• Transparent pricing.

Merger remedies

• Divestiture of competing technology;
• Licensing of critical patents;
• Access commitments;
• Data-sharing safeguards.

Infrastructure remedies

• Open-access CO₂ pipelines;
• Transparent storage allocation;
• Capacity auctions;
• Non-discriminatory connection rules.

31. A Climate-Engineering Competition-Law Test

A useful analytical framework is:

Step 1 — Define the market

Is the relevant market:

• DAC?
• CCS?
• Carbon-removal verification?
• CO₂ transportation?
• Geological storage?
• Carbon-credit trading?
• Climate-engineering data?

Step 2 — Identify the bottleneck

Determine whether the firm controls:

• Technology;
• Infrastructure;
• Data;
• Patents;
• Certification;
• Customers.

Step 3 — Assess market power

Examine:

• Market share;
• Entry barriers;
• Switching costs;
• Network effects;
• IP;
• Capital requirements.

Step 4 — Identify conduct

Look for:

• Refusal to deal;
• Exclusivity;
• Tying;
• Bundling;
• Self-preferencing;
• Predatory pricing;
• Discriminatory access;
• Information exchange.

Step 5 — Evaluate environmental benefits

Determine whether cooperation generates:

• Genuine emissions reductions;
• Carbon removal;
• Environmental quality improvements;
• Scientific or safety benefits.

Step 6 — Apply proportionality

Ask whether the restriction is:

• Necessary;
• Appropriate;
• Limited in scope;
• No broader than required.

Step 7 — Assess innovation

Determine whether the conduct:

• Preserves innovation;
• Eliminates potential competitors;
• Restricts alternative technologies.

Step 8 — Select remedies

Possible solutions include:

access + interoperability + licensing + transparency + structural separation.

32. Summary of the Principal Cases

33. Key Emerging Competition Issues

The most significant future competition questions are likely to concern:

1. Dominance in direct-air-capture technology;
2. Access to geological CO₂ storage;
3. CO₂ pipeline monopolies;
4. Patent concentration;
5. Climate-engineering data monopolies;
6. Carbon-removal certification monopolies;
7. Carbon-credit exchange concentration;
8. Long-term carbon-removal offtake agreements;
9. Government subsidies and state aid;
10. Climate-tech mergers and killer acquisitions;
11. Algorithmic pricing;
12. Interoperability between climate technologies;
13. Self-preferencing by climate-tech platforms;
14. Exclusive licensing arrangements;
15. Sustainability agreements between competitors;
16. Vertical integration of capture, transport and storage;
17. Cross-border market foreclosure;
18. Control over scientific and environmental data.

34. Conclusion

Climate-engineering markets are likely to create a distinctive intersection of competition law, environmental policy, infrastructure regulation, intellectual-property law and state-aid control.

The central competition problem will not necessarily be conventional monopoly pricing. Instead, market power may arise from control over technology, patents, geological storage, CO₂ transportation, data, certification, algorithms and network infrastructure.

The established jurisprudence in Bronner, IMS Health, Microsoft, Google Shopping, Aéroports de Paris, Meca-Medina, CECED and Eturas provides useful analytical foundations even though these cases do not themselves constitute a mature body of climate-engineering competition jurisprudence.

The key regulatory challenge will be to achieve two objectives simultaneously:

preserve incentives to invest and innovate in climate technologies while preventing control over critical climate infrastructure and technological bottlenecks from being converted into durable market power.

As climate-engineering markets scale, competition authorities are therefore likely to move beyond conventional price-based analysis toward innovation competition, infrastructure access, data control, sustainability cooperation, ecosystem foreclosure and state-supported market creation.