Government scrapped £1bn plan in 2015 but now aims to build project within a decade

This article is more than 1 year old

This article is more than 1 year old

The UK wants to build its first project to capture and store carbon emissions from industry within the next decade, as part of a rebooted push by ministers to support the technology.

The government scrapped a £1bn carbon capture and storage (CCS) competition in 2015, with the then-chancellor George Osborne saying it was too costly. Earlier efforts had also collapsed.

But on Wednesday the energy minister, Claire Perry, will signal the government’s renewed interest in the technology, including plans to repurpose fossil fuel infrastructure, such as reusing old gas pipelines to transport the carbon.

A new £20m dedicated fund will help build carbon capture equipment at industrial sites, which comes on top of an existing £100m pot. The hope is for a pilot facility in the mid-2020s, followed by full-scale ones in the 2030s.

Previously the focus was on capturing and storing emissions from a coal or gas power station, but the rise of renewables has made that goal less pressing.

This time round the priority is on capturing the carbon produced by heavy industry, such as chemicals plants and oil refineries, with the carbon then either stored or sold for use elsewhere in industrial processes.

Stuart Haszeldine, professor of carbon capture and storage at the University of Edinburgh, welcomed what he called a “sensible reboot” that would put “rocket boosters” under trials.

Looking beyond just capturing carbon from power plants would help, he said. “This is much more probable [to succeed] than the previous attempts, because the capture of CO 2 is spread across numerous different types of industry.”

But he warned that companies would want reassurances, having been burned by previous government schemes that have seen firms write off investments worth hundreds of millions of pounds.

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Carbon capture, utilisation and storage (CCUS) is seen by experts as a vital technology for tackling climate change, and reducing emissions in hard-to-treat polluting industries.

Fatih Birol, executive director of the International Energy Agency, said: “Without CCUS as part of the solution, reaching our international climate goals is practically impossible.”

The economist is speaking along with Perry at a CCUS summit on Wednesday in Edinburgh, joined by business leaders including BP’s chief executive, Bob Dudley.

While the aspiration for a CCUS facility in the mid-2020s is new, industry will have to wait until next year before officials publish the action plan to get the plant built.

The government said it had received interest from industrial centres in Scotland, south Wales, Humberside, Merseyside and Teesside.

One project, to capture carbon at a gas terminal north of Aberdeen, will enjoy an immediate £175,000 of government investment, to be matched by the Scottish government – and with the European commission providing funding too.

Drax Group, which runs the UK’s biggest power station, recently began work on a £400,000 trial to capture the carbon from one of its biomass-fired units.

The company has not yet confirmed who would buy the carbon, but has said it is in talks with the drinks industry, which was hit by a shortage of carbon dioxide earlier this year.