The UK Energy and Climate Change (ECC) Committee report examines the progress of CCS in the UK as well as setting out a number of recommendations on how to overcome barriers to deployment. In particular, the ECC Committee recommends that the Government should “commit to a realistic but ambitious timeline for awarding support to projects both inside and outside its CCS commercialisation competition”.
"Fitting power stations with technology to capture and store carbon is absolutely vital if we are to avoid dangerously destabilizing the climate," said Energy and Climate Change Committee Chair, Tim Yeo MP. "After nearly a decade of delay DECC has finally got near to delivering two pilot Carbon Capture and Storage projects in the UK. It must now fast-track these projects and reach final investment decisions before the election to ensure this technology can start delivering carbon savings by the 2020s."
"These two demonstration projects will not be enough to kick-start the industry or have a significant impact on our carbon budgets, however. Ministers must also ensure that viable CCS projects not involved in the competition are able to apply for guaranteed-price contracts alongside other low-carbon energy schemes."
The Carbon Capture and Storage Association (CCSA) welcomed the report, Luke Warren, Chief Executive of the CCSA, commented:
“The ECC Committee’s report on CCS and its recommendations is extremely timely – and we very much share their concerns and frustrations on the substantial delay to the development of CCS in the UK.
We strongly support the recommendations of the Committee, particularly in relation to the need for speed on projects both within and outside of the CCS competition.
As well as highlighting the importance of successfully concluding the current competition we are extremely pleased to see that the Committee has identified the need for clarity surrounding the availability of CfDs for non-competition projects. There is a very real risk that, without a strong signal that these projects can access a CfD in parallel with the competition, these projects will be shelved.
There is no credible scenario for cost-effectively tackling climate change without CCS. The sooner we build the first projects, the sooner we will be on the path towards meeting this goal whilst delivering the significant benefits that a mature CCS industry can offer”.
Scottish Carbon Capture and Storage (SCCS) said that everybody was agreed CCS is essential for the future of UK low-carbon electricity.
The UK is uniquely positioned for developing CCS, said SCCS. It has inventive manufacturers to develop CO2 capture equipment, industries to engineer equipment and pipelines, and a world-leading offshore hydrocarbon industry to undertake safe and secure CO2 storage. The Committee states that the UK should concentrate on developing its massive, and potentially profitable, offshore storage in depleted oilfields and saltwater aquifers – hundreds of years’ worth. And it points out that the UK Government should better inform its public about the benefits.
The UK has an outstanding civil service, which has delivered the correct legislation, regulation and electricity market reform rapidly and to the highest quality. Two full-chain CCS commercialisation projects (Peterhead, Aberdeenshire; and White Rose, Yorkshire) are also being examined, but they will not begin operating until 2018 at the earliest.
Why is the UK so slow at developing this technology, which the Committee says will reduce wholesale electricity costs in 2030 by 20% – and will halve the extra cost of low-carbon power by 2050, according to the Energy Technologies Institute? The delivery of CCS takes time to build the necessary equipment. If we are to meet these milestones, the UK must have another five projects under construction by 2020.
Professor Stuart Haszeldine, SCCS Director, said: “We all want a secure future, which includes low-carbon energy. Developing five CCS projects now will cost each UK household around £30 per year. The UK needs more than 30 of these to start building before 2025. To avoid extra costs later, we must develop our CO2 storage now. That is a good insurance premium against the 100% certainty of future carbon taxes and future global change. Avoiding CCS investment may look cheap today, but is storing up high-cost trouble for later.”
Ironically, three fully commercial projects await the UK Government’s use of market powers, which already exist, to kickstart development. Summit Power’s CCS proposal at Grangemouth could create 5,000 construction jobs from 2015, 2Co Energy’s Don Valley CCS Project in Yorkshire was once a leading European project, and Teesside Low Carbon could decarbonise a large part of the UK chemical industry. All are withering due to a lack of government attention. All could pipe CO2 offshore to produce additional oil recovery from depleted fields, which would more than pay for their costs through oil tax revenue."