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Energy and Climate Change Committee Calls for CCS Strategy

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Parliament’s Energy and Climate Change Select Committee recently published a report, “Future of Carbon Capture and Storage in the UK”, which considers how Carbon Capture and Storage (CCS) can help the UK to meet vital emissions targets while continuing to manufacture and generate power from fossil fuels. CCS, which captures emissions from fossil fuel sources and stores them in geological formations underground, provides an opportunity for industries such as steel, cement, and the power sector to remove their emissions.

Last year, the government cancelled £1 billion of funding for a CCS commercialisation competition just before the results were scheduled to be announced. Two projects had been in progress since the competition started, nearly four years previously, to gain competition funding. The Peterhead project in Aberdeenshire was being developed by Shell and SSE and the White Rose project was being developed at Drax power station by Alstom UK Ltd and National Grid PLC. Drax power station itself had previously pulled out of the White Rose project.

The government’s “energy policy reset” plan, announced last year, includes a policy of increased reliance on gas-fired generation in the short term. The select committee sees this policy as being contradictory with the decision to end investment in CCS as increased gas use will require CCS in order for the UK to meet its emission targets. The Select Committee reports: “While gas is cleaner than coal, it still produces on average 400 gCO2/kWh. The CCC has assessed that an average grid intensity of around 50 gCO2/ kWh by 2030 was the necessary objective for the power sector if the UK is to meet its targets.” It sees CCS as a means of closing the emissions gap. Meanwhile, the government has said it will launch a consultation in the spring on the closure of all unabated coal-fired power stations.

Global emission reduction plans, made ahead of the Paris Climate Summit, are not yet stringent enough to keep global warming at 2 degrees, or less, above pre-industrialised levels. It is recognised that existing emission reduction plans need to be built upon in the future and the implementation of CCS is essential in meeting the required emission reductions.

Following the cancellation of CCS support, the Department of Energy and Climate Change said the government has not ruled out CCS, but that it is too expensive at present. Instead, they would invest when costs reduced, therefore relying on other countries to carry out the required research and development. However, there is concern that this is a lost opportunity for the UK and that potential funding from the EU’s New Entrant Reserve may be permanently lost.

The Select Committee’s report points to CCS providing new revenue streams for the UK, as well as maximising output from North Sea oil reserves, by utilising empty gas and oil fields for storage. While significant investment in infrastructure would be required initially, the costs of later projects are expected to fall rapidly once the primary infrastructure is in place and the report calls on the government to assess the income potential.

The Committee recommends that MPs devise a new CCS plan quickly so that expertise and opportunity are not lost and that a CCS strategy is published by the summer of 2016. The full report, which is awaiting government response, can be found here.

Written By – Nikki Wilson


Alfa Energy Group

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