From the TUC

DECC shortlist surprises carbon capture industry

31 Oct 2012, by in Economics, Environment, Uncategorized

Question: In deciding not to shortlist the Don Valley Power Project for the UK’s £1bn Carbon Capture and Storage (CCS) competition, is the government’s intent on pushing any major financial commitment to carbon capture into the next Parliament? Certainly, Don Valley, Yorkshire, the top ranked project in a parallel process run by the European Commission, appeared to be “shovel ready”. For the Leeds-based CCS development agency, CO2Sense, among others, the question being asked is, Was Don Valley too ready to go?

The four bids on the DECC shortlist are all full chain capture, transport and storage projects:

  • White Rose Project: a new 304MW fully abated coal-fired power station on the Drax site in North Yorkshire.
  • Captain Clean Energy Project: a new 570MW, fully abated coal power project in Grangemouth, Scotland.
  • Peterhead, Scotland: a 340MW capture plant retrofitted to part of an existing 1180MW gas power station.
  • Teesside Low Carbon Project: a coal project linked to 330MW power generating capacity fuelled by synthetic gas.

Research commissioned by the Yorkshire and Humber CCS Cluster Steering group shows that if the White Rose Project, owned by Drax Power, succeeds, it could deliver £530m and 3500 jobs to the UK economy.

In July, the 650MW Don Valley project in South Yorkshire topped the list of European CCS projects competing for an estimated €337 million share of the €1.3 billion funding pot available in the EU’s CCS programme. The UK had four projects on the list but each required co-funding commitments from the UK. It would have been operational from the end of 2016 – just as the retirement of existing power plants is expected to make the UK’s electricity supply/demand balance a significant issue.

So CO2Sense’s comments reflect the surprise of many in the CCS industry that 2Co Energy’s Don Valley Power Project has missed out on the shortlist. “Funding the project would have placed the UK at the forefront of a global industry, but the effect of today’s decision is that the UK has missed out on an opportunity to build the most advanced CCS plant in the world in the next few years.”

Lewis Gillies, CEO, 2Co Energy  said: “This is truly disappointing news for the Doncaster area where we would have built this plant and for our world-class project team working to deliver it. We will complete the current phase of the project and meet the knowledge-share obligations of our existing EEPR funding from the EU but we cannot take this project further without funding from the UK government. In the meantime, we are trying to come to terms with how the UK’s most advanced project that has twice been selected by the EU for funding and is currently sitting as Europe’s top ranked project has not even made it to the UK’s shortlist.”