The UK government confirmed to the London Stock Exchange last November that the £1 billion “ring-fenced” capital budget for the CCS competition was no longer available, prompting Scottish Energy Minister Fergus Ewing to call the move a “disgrace”
Shell’s CEO described the UK government’s decision last November to cancel its plan to help fund a major CCS development as “a huge disappointment”
“Our Peterhead project in Scotland would have been the world’s first CCS facility fitted to an existing gas-fired power plant,” he said.
“It was one of the final contenders in a competition which would have placed Britain at the forefront of this vital technology.”
He said CCS could cut emissions from gas-fired power plants by up to 90% and would be a lower-cost way to reduce carbon emissions than offshore wind, for example.
In response to Energy and Climate Change Committee Angus MacNeil’s query on scrapping the CCS competition, Rudd pointed out the government had already invested more than £30 million in CCS research and development between 2011 and 2016, and re-iterated that that the technology still had a role to play in the UK’s low-carbon future.
“The Spending Review undertook a full review of capital spending plans to identify the areas of spending that will achieve the best economic returns while delivering on the commitment to invest £100 billion in infrastructure by the end of the Parliament.
“This necessarily involved difficult decisions, including to no longer make available £1 billion capital funding to support the CCS competition.”
The government had announced a £1.7 million fund to support three innovative CCS technologies through the government’s Energy Entrepreneurs Fund and £2.5 million through the Energy Technologies Institute.
“We are also supporting, jointly with the Scottish Government, Summit Power with £4.2 million funding to undertake industrial research and development at their proposed CCS Caledonia Clean Energy Project in Grangemouth,” she added.
She was adamant that the UK was still “widely seen to be one of the most stable markets due to its attractive risk and return profile, world-class regulation, transparent policy development, strong financial markets and clear property rights for investors”
Last week she blamed Labour for awarding £175 million in public subsidies to support diesel generators.
