Carbon capture competition launched by DECC

Energy secretary Edward Davey has today launched a new competition for carbon capture and storage (CCS), which the government says is a key technology in its drive to ensure our future energy security and reduce emissions.

The Department of Energy and Climate Change (DECC) has also published the first UK CCS Roadmap which sets out steps the government is taking to develop a new CCS industry in the 2020s.

These include:

· The competition. The ‘CCS Commercialisation Programme’ aims to drive down costs by supporting practical experience in the design, construction and operation of commercial scale CCS with £1bn capital funding

· £125m funding for Research and Development, including a new £13m UK CCS Research Centre.

· Planned long term contracts for difference through electricity market reforms to drive investment in commercial scale CCS in the 2020s and beyond.

· Commitments to working with industry to address other important areas including developing skills and the supply chain, storage and assisting the development of CCS infrastructure.

· A focus on international engagement, in particular on learning from other projects around the world to help accelerate cost reduction in the UK, and sharing the knowledge we have generated through our programme.

DECC says that this CCS package is a clear illustration of the government’s global leadership on CCS and firm commitment to working with industry to enable cost competitive CCS in the 2020s. It reflects the major long term opportunity for green jobs and green growth on the journey to a low carbon economy, potentially supporting around 100,000 jobs in the sector by the end of the next decade.

Energy Secretary, Edward Davey,  said: “The potential rewards from carbon capture and storage are immense: a technology that can de-carbonise coal and gas-fired power stations and large industrial emitters, allowing them to play a crucial part in the UK’s low carbon future.

“What we are looking to achieve, in partnership with industry, is a new world-leading CCS industry, rather than just simply projects in isolation – 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 £6.5bn a year to the UK economy by late next decade as we export UK expertise and products.

“This is a really exciting time for the fledgling CCS industry. Our offer is one of the best anywhere in the world. We have £1bn available to support the upfront costs of early projects along with a commitment to further funding through low carbon Contracts for Difference, we have £125m to support research and development including a new UK CCS Research Centre, and we have the long term incentives in place through our Electricity Market Reforms.”

Jeff Chapman, ceo of the Carbon Capture and Storage Association, added: “We welcome this announcement; it creates an opportunity for the UK to take a leading role in world markets whilst cost-effectively reducing emissions, creating employment and generating prosperity. We are looking forward to working with Government to enable industry to capitalise on today’s announcement to ensure extensive investment in CCS over the coming decades.”