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Today the CCUS Cost Challenge Task Force has made a series of recommendations on how government and industry should work together to deploy carbon capture, utilisation and storage (CCUS) in the UK in the 2030s.  

CCUS reaches across the whole economy, for example in the retention and growth of high-value jobs in industrial production and the oil and gas industry; and the production of low-cost hydrogen with CCUS to decarbonise heat and transport. CCUS is vital to the aspirations of industrial growth as defined in the government’s Industrial Strategy and Clean Growth Strategy. A study last year, Clean Air, Clean Industry, Clean Growth: How Carbon Capture Will Boost the UK Economy, concluded that CCUS could boost the UK economy by an estimated £163 billion between now and 2060, outweighing the investment costs of £34 billion by a factor of five times.

The Task Force report recommends focusing on regional clusters around industry, power production and hydrogen production; gathering CO₂ and transporting through separately managed, shared infrastructure to offshore storage rather than the end-to-end, single large power plant projects of the past.

The report finds that large cost reductions are possible through this sharing of infrastructure and additionally through the reuse of existing oil and gas infrastructure, both onshore and offshore. Several existing pipelines connected to well-characterised stores are suitable for conversion to CO₂ transport, leading to reductions in capital costs of £750 million for the Acorn project and £440 million for the Caledonian Clean Energy Project. These large potential savings can only be achieved if we make sure that the pipelines we need aren’t swept up in the rush for decommissioning. The Oil and Gas Authority and BEIS need to urgently review the decommissioning process and the implementation of the Maximising Economic Recovery Strategy in the next few months. 

If government wishes to have the option to deploy at scale in the 2030s the building and operating of CCUS networks must begin in the 2020s, but before construction decisions can be taken early action is needed on legislation, risk management and financial structures. Two such actions include changes to the gas safety management regulations (GSMR) and managing the long-term liability for storage. Regional gas companies will be making investment decisions during 2019 for the period 2021 to 2026 so it is urgent that a commitment is indicated to change the GSMR to allow some hydrogen content in our existing gas networks; and unless the government caps liability or takes some of the burden of risk then storage projects will remain difficult to insure.

Stuart Haszeldine, SCCS Director, said:

“This comprehensive report compiles an integrated examination of industrial need, technical capability and financial investability. The report proposes a very welcome reset of CCUS strategy, which recognises for the first time that CCUS has value across the entire UK economy and enables clean industrial growth.

“East Scotland is extremely well placed as a region of the UK with unique access to commercially-ready very secure CO₂ storage sites offshore.  We have two leading CCS projects - Acorn and the Caledonia Clean Energy Project – which are ready to bring costs down further by re-using oil and gas industry legacy pipelines.

“CCUS will enable the retention of tens of thousands high value skilled jobs in the oil and gas industry and is a significant part of the North Sea oil and gas industry’s transition to a low-carbon future. It is positive that the task force has recommended that government and industry undertake a strategic review of the oil and gas assets that could be repurposed for carbon dioxide transport.  However, this needs to go further – UK and Scottish governments and industry need to work together to ensure that these strategic assets are protected and kept in good condition until they can be re-used. They also need to make sure that decommissioning is paused until this review is completed, otherwise we run the risk of throwing our infrastructure investment away.”

We now call on the government, and particularly Minister of State for Energy and Clean Growth, Claire Perry to take these recommendations on board, and start taking the action we need to make CCUS a reality.

 

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Media enquiries

Please contact Indira Mann:

+44 (0)131 650 0294

indira.mann@sccs.org.uk

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