Decarbonisation in Asia: Risk, Responsibility and Opportunity in the Energy Transition

CCUS Moves from Concept to Commercial Reality

Across the global energy transition, carbon capture, utilisation and storage (CCUS) has moved from concept to commercial reality. In markets such as the UK, Europe and North America, projects are no longer small scale pilots. They are now embedded in national decarbonisation strategies, backed by regulation, capital and coordinated public–private partnerships.

For energy, natural resources and industrial businesses, CCUS is becoming one of the defining technologies of this era. Hard to abate sectors – including power generation, steel, cement, mining, refining and petrochemicals – are turning to carbon capture as a practical way to reduce emissions while keeping operations running and product supply stable.

At Aon, we see this transition unfolding in real time through our work with clients, governments and other stakeholders in more mature CCUS jurisdictions. In the UK and Europe, for example, clearer regulatory frameworks are emerging. They are starting to define risk transfer, liability and the long term resilience of projects.

A key factor in commercial success is deciding who owns the CO₂ at each stage and who is responsible for it during transport and permanent storage.

In Europe, frameworks are evolving around the principle that once CO₂ is transferred to a licensed storage operator, ownership and long term liability may also transfer. In practice, that places responsibility for the permanence and integrity of storage with the storage provider.

This gives greater certainty along the value chain. Emitters, transport operators, storage providers and their stakeholders can operate within a more unified framework, supporting investment decisions and giving the industry the confidence to scale.

Asia, however, presents a different and more complex picture.

A Cross Border CCUS Ecosystem

Unlike Europe or the United States, Asia’s CCUS ecosystem is unlikely to develop within a single regulatory or legal framework. Instead, it is emerging as a cross border network of emitters, transport routes and storage hubs that span multiple jurisdictions.

This creates one of the most complex and dynamic risk environments in the global energy transition. Industrial emitters in markets such as North Asia may capture carbon domestically, but limited geological storage means sequestration is likely to occur elsewhere in the region.

In this model, CO₂ stops being purely an industrial waste stream and starts to behave more like a cross border commodity.

That shift raises fundamental questions:

• Who owns the CO₂ at each stage in the chain?
• Who bears liability if stored carbon leaks in the future?
• How should contractual indemnities be structured between emitters, transporters and storage operators?
• How will different regulatory regimes interact and shape commercial agreements?
• To what extent can insurance improve project bankability and help meet regulatory requirements?

Asia may ultimately take a different approach to liability than Europe. The allocation of ownership and long term responsibility is still evolving and will likely be driven by a mix of regulation and commercial structuring.

That has direct implications for project financing, risk allocation and how insurance programs are designed.

The Role of Insurance in Managing CCUS Risk

As CCUS projects scale, effective risk management and risk transfer will be central to attracting investment and supporting long term viability.

These projects involve complex engineering, long duration exposures and changing legal frameworks. That moves the conversation beyond traditional asset protection.

Risk and insurance strategies will increasingly focus on:

• How liability is allocated along the value chain
• Contractual clarity between cross border stakeholders
• Construction and operational risk in technically complex environments
• Long term exposure related to stored CO₂
• Financial security to meet regulatory and permit requirements

In more mature CCUS markets, we are already seeing innovative risk transfer solutions develop. In Asia, there is an opportunity to shape approaches that reflect the region’s cross border dynamics and regulatory diversity, rather than importing models that may not fit.

A Defining Decade for Asia

Carbon capture remains capital intensive and technically demanding. Questions around commercial viability, infrastructure scale and regulation will continue to evolve. Asia is at the start of what could be one of the most significant CCUS growth stories globally – defined not only by engineering capability, but also by regional collaboration, regulatory innovation and new approaches to risk sharing.

Decisions made today by governments, regulators, emitters, transport operators and storage providers will shape how this market develops over the coming decades.

As the region moves from ambition to implementation, the ability to navigate uncertainty while building investor confidence will be critical.

How risk is defined, structured and managed across the CCUS value chain will help determine which projects move forward, and at what scale. For organisations navigating these issues, engaging early on risk, liability and insurance considerations can unlock opportunity, support investment and accelerate decarbonisation.

How Aon can help

With industry leading capabilities across both traditional and alternative risk transfer, Aon is built to deliver decarbonisation and energy transition solutions that are scalable, innovative and aligned to the needs of complex energy, natural resources and industrial businesses across Asia. Find out how Aon’s Energy Transition insurance solutions can help you manage volatility and enable growth.

Contact us to review your CCUS or wider decarbonisation program, identify potential gaps and explore how to improve value from both coverage and capital.