Many of the UK’s heavy industries could close unless the Government kick-starts carbon capture technology, MPs are warning.
The Business, Energy and Industrial Strategy Committee said carbon capture usage and storage (CCUS) is needed to meet climate change targets as well as supporting productivity growth in parts of the UK.
Failure to deploy CCUS could double the cost of meeting climate change targets, said the committee.
MPs accused the Government of a “lack of clarity” in deploying CCUS as well as the cost reductions it is demanding before offering support.
This “lack of enthusiasm” is symptomatic of the turbulent history of CCUS in the UK, and the lack of policy support for the technology, despite a decade of increasingly urgent calls from official bodies and parliamentary inquiries to bring forward its deployment, said the report.
A first CCUS demonstration competition was launched in 2007 and was followed in 2009 by a commitment to support up to four CCUS demonstrations over the following decade, but in 2011 the first one was cancelled because it could not be funded within the £1 billion budget agreed, said the report.
A second £1 billion competition was launched in 2012 but cancelled in 2016 due to concerns about the future costs for consumers.
Committee member Anna Turley, Labour MP for Redcar, said: “The UK has an opportunity to lead the world in the development of a new CCUS industry.
“In addition to helping to tackle UK carbon emissions, CCUS can play a crucial role in delivering much-needed investment in skills and infrastructure and supporting regional growth and jobs.
“The current energy minister has been a champion for CCUS, and there have been some encouraging recent developments, but the CCUS industry has been the victim of years of turbulent policy support and suffered a series of false dawns.
“The Government now needs to give the green-light to CCUS and ensure that we seize the domestic growth and jobs opportunities of this modern, green industry.
“CCUS is crucial to meeting the UK’s climate change targets and will be vital to achieving a net zero target, but Government support is needed to make CCUS a reality.
“Without CCUS many of our heavy industries could face closure. CCUS has a critical role to play in decarbonising our economy and modernising UK industry – the Government should now throw its full support behind CCUS and put the right policy levers in place to ensure that this technology can deliver on its potential.”
Energy UK’s chief executive Lawrence Slade said: “Energy UK is a member of the CCUS Council and our members are already deploying pilot schemes, but while there is growing recognition from Government of the importance of CCUS, a full commitment is necessary to bring forward the substantial and long-term investment that will enable it and allow CCUS to play a crucial role in the future energy system.
“As we’ve seen with renewables like offshore wind, becoming a world leader in new technologies can bring economic benefits to the UK through jobs, investment and exports – at the same time as innovation and growing expertise drive down costs.”
Will Gardiner, chief executive of Drax Group, which is currently piloting CCS technology at its power plant at Selby in North Yorkshire, said: “Climate change is the biggest threat to our planet but if we take steps now the UK could lead the world in pioneering the CCUS technologies needed to meet our climate targets.
“Supporting the development of the CCUS industry in the UK will generate jobs and economic growth here whilst creating new export opportunities, helping other countries to make the progress needed to meet global climate targets.”
David Duguid, Scottish Conservative MP for Banff and Buchan, said: “I completely agree with the report’s finding that the UK must seize the industrial and decarbonisation benefits of CCUS.
“This technology presents a huge opportunity to help reduce carbon emissions, while also benefiting many other parts of our economy.
“I have been lobbying ministers in support of the North East Scotland cluster, which would connect St Fergus Gas Terminal with the industrial complex at Grangemouth.
“If approved, this would be a real boost for the local economy here in Banff and Buchan.”
A Business Department spokesman said: “We are pleased that the committee shares our believe that CCUS can play an important role in meeting our climate targets.
That is why through our Industrial Strategy we are investing over £50 million in developing this innovative technology and a further £170 million towards our mission to fully decarbonise an industrial cluster by 2040, where CCUS will play a key role.
Our Carbon Capture Action Plan shows we are ready to rise to the challenge of tackling climate change while kick-starting a new industrial opportunity as we aim to deploy the first CCUS facility in the UK from the mid-2020s and roll out the technology at scale by the 2030s.”
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