Energy giant E.ON has announced that it will be dropping out of the UK Government’s carbon capture and storage (CCS) competition.
The company says that its Kingsnorth project, which was one of the last two schemes shortlisted in the competition, could not meet the necessary timescales.
Yesterday, UK Chancellor George Osborne set aside £1 billion to push forward with CCS technology and the Government’s demonstration project.
E.ON’s controversial new 1600 MW fossil-fuel power station at Kingsnorth would have been the UK’s first commercial CCS scheme – but has been on hold since the economic downtown.
But yesterday the company announced that – despite of the Chancellor’s announcement – the economic conditions are still not right and that it must, therefore, withdraw from the competition.
“Having postponed Kingsnorth last year, it has become clear that the economic conditions are still not right for us to progress the project and so, simply put, we have no power station on which to build a CCS demonstration,” says chief executive Paul Golby.
The withdrawal of E.ON from the competition leaves the way clear for the only other contender – Scottish Power’s Longannet project.
Instead, E.ON says it will be focusing its efforts on its Maasvlakte project in the Netherlands, which Golby says will be able to provide lessons for any future projects in the UK.
The Maasvlakte project is a collaboration with Electrabel, Gdf Suez and the Rotterdam Climate Initiative on a full-scale 250 MW CCS unit for a power station currently under construction.
As one of the last two competitors, E.ON is currently undertaking a front end engineering and design study at Kingsnorth, which it says it will complete and share the information.
For further information:
UK Green Investment Bank budget slashed in Spending Review (20-Oct)
E.ON presses ahead with Kingsnorth carbon capture project (11-Aug)
E.ON and ScottishPower win funding for UK carbon capture trial (15-Mar)
E.ON shelves plans for new coal power plant at Kingsnorth (8-Oct 2009)
21 October 2010