Commit to CCS and consider a RAB funding model, says BEIS Select Committee

Carbon capture and storage (CCS) is a key tool for decarbonisation and the government should consult on new funding models to support it, including a ‘regulated asset base’ model. That was the conclusion of ‘Third time lucky?‘ a new report from the Select Committee on Business, Energy and Industrial Strategy, which said that CCS was necessary if the UK were to credibly adopt a ‘net zero emissions’ target.

Failure to deploy CCUS “could double the cost of meeting our targets under the Climate Change Act 2008, rising from approximately 1% to 2% of GDP per annum in 2050,” the committee said.

The Committee said government should see CCS as a way to support industry, not an additional cost on power generation, and support it with clear policy targets. It should consult on the financial model instead of forcing projects to enter another competition.

The committee singled out two government bodies for their lack of support for CCS. Industries  see it as critical to their future but the National Infrastructure Assessment’s cost-benefit analysis excluded industrial applications of the technology, and the Treasury cancelled both CCS competitions. Future decisions on funding must be taken “with a full and thorough understanding of the critical role it is expected to play, not only in decarbonisation across the whole economy, but in extending the life of and modernising UK industry,” said the Committee.

Responding to the report, Scottish Carbon Capture and Storage (SCCS), a partnership of five universities in Scotland, said the UK is uniquely well placed to develop CCS.  Stuart Haszeldine, professor of CCS at the University of Edinburgh and SCCS director, urged the government to act on the Committee’s recommendations. He said, “We are pleased to see the Committee focusing on the ‘how’ rather than the ‘why’ of CCS.

“There are five potential CCUS clusters of high-emitting industries, which want to reduce their emissions by capturing and permanently storing the CO₂ they emit.  Each cluster has different and complementary strengths, and the UK government needs to support them to collaborate, not pit them against each other in a competitive arena.

“There is still the question of how development of carbon storage will be paid for, and how networks of networks of pipes to transport the CO₂ will be funded.  It’s clear that a new business needs to be created, with CO₂ as its subject.

“The appetite for rapid change to tackle CO₂ emissions is clear, but the vagueness of government policy, and the lack of dedicated funding for CCS, continues to act as a brake on these ambitions.”

Luke Warren, chief executive of the CCSA, said: “Just a few days before the Committee on Climate Change submit their advice to Government on long term climate change targets, this is exactly the sort of ambition that is needed. CCUS is not “an option”, it is a “must have” if we are to have any hope of achieving net zero emissions by the middle of the century.”

Read the full report

Leave a Reply

Your email address will not be published. Required fields are marked *