Carbon Capture and Storage: UK Government approach in "direct contradiction" to energy policy

The UK Government’s sudden U-turn on Carbon Capture and Storage funding damaged both relations with industry and investment to the UK, according to a report from the House of Commons Energy and Climate Change Committee.

The Westminster committee said Department of Energy and Climate Change (DECC) decision-making on CCS had been in “direct contradiction” to the UK’s energy and climate change policy.

In its report the committee urges the Government to urgently devise a new strategy for CCS in conjunction with a new gas strategy.

CCS aims to traps carbon dioxide, emitted by coal and gas power plants, and store it underground in an effort to mitigate climate change.

The UK Government scrapped a UK-wide CCS competition in November, just weeks before final bids were due for the £1bn fund.

The funding had been set out in the Conservative manifesto with Peterhead power station one of two plants bidding for the competition.

The report warned that if DECC does not come up with a clear strategy for CCS very soon, “knowledge, investment, assets and expertise in the UK will all be lost”.

Meeting the UK’s climate change commitments will be more challenging without CCS, the report added, and may require “large and potentially more expensive carbon savings to meet the legally binding targets”.

The report said: “Pulling the plug on the competition without warning in this way was damaging both to the relationship between Government and the industry, and to investment into the UK.”

“This delay also seems to be in direct contradiction with the direction of energy and climate change policy set out in the Government’s ‘energy policy reset’. With gas and without CCS, we will not remain on the least cost path to our statutory decarbonisation target.

“If Government is committed to its climate change targets, it cannot afford to sit back and simply wait and see if CCS will be deployed at the moment when it is needed.”