UK government launches CCS competition and new roadmap

UK Energy Secretary Ed Davey today relaunched the government’s £1 billion carbon capture and storage (CCS) competition and unveiled its first roadmap for the technology.

The competition, now called the ‘CCS Commercialisation Programme’, promises to invest £1 billion of capital funding, with the potential for additional support, in the design, construction and operation of commercial scale CCS.

Meanwhile, the roadmap sets out further steps to develop a “new world-leading CCS industry” in the UK in the 2020s.

These steps include £125 million for research and development, including a new £13 million CCS research centre and a commitment to work with the industry on developing the necessary skills and supply chain.

The roadmap also highlights the government’s planned ‘contracts for difference’ in the Electricity Market Reform as a means of driving investment in CCS in the 2020s and beyond.

And in a nod to the government’s critics over its handling of the previous CCS competition, which ended in a fiasco after the ‘winning’ bid withdrew over lack of sufficient funding, the roadmap promises to learn from other CCS projects around the world.

“What we are looking to achieve, in partnership with industry, is a new world-leading CCS industry, rather than just simply projects in isolation,” said Davey in a statement. “An industry that can compete with other low-carbon sources to ensure security and diversity of our electricity supply, an industry that can make our energy intensive industries cleaner and an industry that can bring jobs and wealth to our shores.”

The CCS industry could be worth £6.5 billion to the UK economy by the end of the 2020s and support around 100,000 jobs.

The CCS Commercialisation Programme will now have to be cleared under State Aid rules but potential participants are now being invited to register by April 13.

Qualifying projects must be a CCS full chain project – or have the potential to be one, be located in the UK, be operational by 2016-2020 – or sooner if possible and abate CO2 at a commercial scale.

The business lobby group the CBI gave a cautious welcome to the announcement, with Rhian Kelly commenting:

“While we welcome today’s announcement, the government must learn lessons from its previous competition… This time around the competition must be simpler and completed as quickly as possible.”

National Grid has also been quick to welcome the announcement, but says that a ‘cluster’ or ‘gateway’ approach – with the potential for more than one emitter to tap into a single, large scale pipeline – is the only way for the government to realise is aspiration of cost-competitive power generation with CCS.

“We believe the development of CCS technology in the UK is vital to decarbonising industry, ensuring a diverse mix of electricity generation in the future and to helping meet carbon emission targets,” says network operations director Chris Train.

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Related stories:
Samsung takes stake in 2Co Energy’s UK CCS project (29-Mar)
US developer Summit Power to scale CCS (21-Mar)
UK government launches £20 million CCS competition (13-Mar)
E.ON to close Kingsnorth power station and drop CCS plans (9-Mar)


03 April 2012