The UK Government’s decision to axe the £1 billion fund for Carbon Capture and Storage (CCS) commercialisation means the UK will struggle to meet climate change commitments, according to findings by the UK select committee on energy and climate change, published today.
The report, Future of Carbon Capture and Storage in the UK, derives from a committee enquiry into the decision by the Treasury last November to withdraw crucial funding, which left the UK’s two flagship CCS projects – Peterhead and White Rose – high and dry weeks before design studies were due to be submitted to the competition.
SCCS supports the recommendations made within today’s report and echoes the committee’s view that the UK Government must now provide a clear strategy on CCS very soon or risk losing a significant amount of knowledge, investment, assets and expertise. We also back the MPs’ call for the government to set up a National Carbon Storage Authority, which would oversee the establishment of CCS infrastructure in the UK.
A spokesman for the Department of Energy and Climate Change said that they “haven't closed the door to CCS technology in the UK”. Yet there is a distinct lack of clarity on how or when CCS will play a part in meeting carbon budgets towards 2050. After today’s findings, and in the context of an international agreement to rein in global warming made at the Paris COP21 talks, the UK must re-open that door to CCS, and quickly, before businesses and investors go elsewhere – to countries, such as Norway and Canada, where the technology is already operating.
Prof Stuart Haszeldine, SCCS Director, said:
The arithmetic is very simple. To protect our atmosphere and oceans, every tonne of fossil carbon produced by the power or industry sectors must be balanced by one tonne of carbon stored using CCS. The UK Government plans to reduce carbon emissions to zero by abandoning coal in favour of gas for power generation. But gas still has a carbon penalty, so the sums still don’t add up unless CCS is used.
Prices quoted for CCS by senior government ministers were incorrect. As well as the cost of capturing CO₂, they also included the cost of infrastructure – pipelines, boreholes and CO₂ storage sites. Yet any infrastructure developed by first-phase projects would naturally be of use to follow-on projects, which would also benefit from cost reductions as a result of demonstrating and refining the technology. We have argued, along with others, that CO₂ capture should therefore be unbuckled from the infrastructure to give a more accurate reflection of cost.
On 8 February, the UK opened its Shetland gas terminal, one of the largest hydrocarbon production sites in north west Europe until at least 2045. Government also intends to build ten new gas-fuelled power plants. It is simply not possible to continue to exploit fossil fuels in this way unless CCS is part of the equation.