In context: The Acorn Project

What is it?

Located at St Fergus in Aberdeenshire, the project aims to transport captured CO2 emissions from the Scottish cluster into permanent storage 2.5km under the North Sea, making it a flagship initiative for Scotland to reach net zero by 2045.

The project plans to capture emissions from power stations such as Grangemouth and Peterhead.

Who is behind the project?

It is a joint venture between Storage, Shell UK, Harbor Energy and North Sea Midstream Partners along with National Gas.

The latter is repurposing existing onshore natural gas pipelines to be able to transport CO2 – the SCO2T Connect project – so the project has the infrastructure it requires.

Who is funding the project?

The uncertainty has been a cause for tension between the Scottish and UK governments over the past years.

In 2021, the Acorn Project missed out on funding after failing to secure a track one status, instead being designated as the “reserve cluster” while two sites south of the border secured the status.

The decision sent shockwaves north of the border drawing criticism from politicians, experts and stakeholders.

Then first minister Nicola Sturgeon urged then prime minister Boris Johnson to overturn the government’s decision, saying the project still had “strong potential”.

Later that year, during a debate on carbon capture put forward by SNP MSP Gillian Martin, the then just transition minister Richard Lochhead said the decision was “illogical” and showed a “clear lack of ambition”.  An opinion supported by Labour MSP Paul Sweeney, who told the chamber that granting a track one status to Acorn should have been a “no brainer”.

In July this year, First Minister John Swinney, announced the Scottish Government would grant £2m to the project, claiming it was “essential” to secure the future of sites including Grangemouth and Mossmorran.

Later that month, then prime minister Rishi Sunak, granted the project direct access to track two status, making it eligible to a share of a £1bn fund from the UK Government.

The new status also meant Acorn could kick-start negotiations with government over the terms of economic licenses and continue working on the infrastructure it required.

The project has also benefitted from two rounds of funding from the European Commission’s Connecting Europe Facility, which supports building or rehabilitating cross-border energy infrastructure across Europe.

So, does the project enjoy cross-party support?

Despite the project is expected to store millions of tons of CO2, which could be decisive for Scotland’s climate goals, not all parties support carbon capture.

Earlier this month, co-leader of the Scottish Greens Lorna Slater said it was an act of greenwashing to invest in the “costly and unproven” technology, adding it was “often used to justify our continued reliance on fossil fuels”.

Meanwhile, Caroline Rance, climate campaigner at Friends of the Earth Scotland said the project was “a pipe dream of polluters that will never live up to its hype." 

What is the ongoing row with the UK Government?

Since the change in government at Westminster, concerns have been growing on Labour’s apparent lack of commitment to the project.

In July, SNP Westminster leader Stephen Flynn wrote to the UK energy secretary Ed Milliband, demanding “certainty” on the timeline for licensing and funding for the “crucial project.”

Two months later, in her address to Labour conference, chancellor Rachel Reeves, mentioned three projects based in England, but failed to mention the project in Aberdeenshire.

Reacting to the speech, the late former first minister Alex Salmond accused the government of betrayal; warning Scots should be “extremely concerned” at Reeves’ decision to “snub” the project in her speech.

And earlier this month, Labour came under significant fire once again, after Prime Minister Keir Starmer pledged £22bn in funding for carbon capture clusters on Merseyside and Teesside over the next 25 years; yet fell short of announcing any economic boost to the Scottish project.

Flynn accused Labour of taking a “clumsy approach to the northeast”. He added: “We’ve seen with Grangemouth what happens when you don’t invest in the energy transition and, at this point, Labour look desperate to repeat those mistakes with their absurd tax changes and failure to invest in CCUS [carbon capture, utilization, & storage] here in the north east”.

What is next?

Earlier this month, during the Council of Regions and Nations, which was held in Edinburgh, Swinney told journalists that making “urgent progress” and “swift decision making” on the Acorn Project was “critical” to address the challenge at the Grangemouth refinery.

However, he added that Starmer understood the urgency and there were ongoing conversations with Miliband.