Posts tagged "CCS"

Joint letter from heads of RenewableUK, CCS association and Nuclear Industry Association on need for 2030 carbon goal

Letter to the energy and climate secretary calls for a reference in the energy bill for the power sector to be almost entirely decarbonised by 2030


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Posted by admin - November 5, 2012 at 19:21

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Industry letter calls for decarbonisation target in energy bill

Leaders of renewables, nuclear and CCS groups warn government is putting new jobs and financial investment at risk

New jobs and financial investment in the energy sector are at risk if the government does not ensure its imminent energy bill supports low-carbon power, an unusual coalition of the trade bodies representing the renewable energy, nuclear power and carbon capture industries has warned.

The letter to the energy and climate secretary, Ed Davey, strongly backs the call from the government’s climate advisers, the Committee on Climate Change (CCC), to include a reference in the bill for the power sector to be almost entirely decarbonised by 2030.

On Saturday, the Observer revealed that the amount of power expected to be generated from gas by 2030 has quadrupled in the last year, raising fears that carbon targets will be missed and low-carbon generation crowded out. The final version of the energy bill, due to bring in the biggest reforms to the energy market in two decades, is expected towards the end of November. The draft version was published in May.

The letter signed by the heads of RenewableUK, the Carbon Capture and Storage Association and the Nuclear Industry Association says that a decarbonisation reference would lower “the perceived political risks, but could also reduce the cost of capital for decarbonising the power sector. We therefore believe that this could be very important for investment going forward.”

The CCC has recommended electricity in 2030 be produced at no more than 50g of CO2/kW by 2030; gas power stations emit around 350g of CO2/kW. The current energy bill draft has no such target.

The trade body chiefs, who represent more than 1,000 companies between them, say that any significant delay in the bill “could result in investment being postponed, with major implications for associated new industrial development and jobs in a high-tech, high growth sector.”

John Sauven, the executive director at Greenpeace, which opposes nuclear power, took the surprising step of welcoming the letter, saying: “This letter shows that whilst different industries will have differing preferences for the exact mix of energy technologies, there is unity from across huge swathes of the business community on the need for a clear goal in the energy bill to take carbon almost completely out of the electricity system by 2030.”


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Posted by admin -  at 19:21

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Huge scale of UK’s ‘dash for gas’ revealed

Emissions targets will be broken if reliance on gas rises in line with new forecasts, say critics

The amount of power expected to be generated from gas by 2030 has quadrupled in the last year, according to official projections that will infuriate green campaigners who are demanding greater use of renewable energy sources.

They claim that the statistics, buried in recently published government documents, will leave the country unable to meet its carbon emission targets. The figures will reinforce the sense that chancellor George Osborne is winning his battle to downgrade the role of green energy in favour of a dash for gas.

The coalition is divided over energy policy, with Osborne favouring a major increase in gas use, promising generous tax subsidies to the shale gas industry at last month’s Tory party conference. The Liberal Democrats want greater emphasis on renewable energy. The chasm was laid bare last week when Tory energy minister John Hayes declared “enough is enough” over onshore wind farms, only to be slapped down within hours by Lib Dem energy secretary Ed Davey.

Data from the department of energy and climate change show the amount of power being generated from gas by 2030 leapt from 8GW in its 2011 projections to 31GW in the same projections 12 months later. The data also show that, as it stands, the carbon targets for the 2020s – called the fourth carbon budget – will be broken. Less than a tenth of the gas power is projected to have carbon capture and storage technology fitted to trap and bury carbon dioxide emissions.

The revelations come as the coalition’s all-powerful “quad” – David Cameron, George Osborne, Nick Clegg and Danny Alexander – prepare to meet again this week to hammer out a deal on the government’s delayed energy bill, which will set out the UK’s energy sources for decades. The last meeting failed to agree after discussion was dominated by an impromptu pledge from Cameron to legislate to force energy companies to give customers the lowest tariffs.

The continuing uncertainty has led the energy industry to warn that billions of pounds of investment in the economy may be lost.

“The idea that unabated gas is a long-term solution is mistaken,” said Tim Yeo, the Conservative MP and chairman of the energy and climate change select committee. “There is a significant risk in being very dependent on gas in the 2020s because the world price may be much higher than it is now.”

Caroline Flint, Labour’s shadow energy secretary, said: “There is a real risk the government’s dash for gas will blow a hole through our climate change targets, undermine investment in clean energy and leave households vulnerable to price shocks and rising energy bills.”

But Davey said: “We need more gas-fired power stations to keep the lights on, but the vast majority of this will be to replace old polluting plants. It will be alongside new nuclear, CCS [carbon capture and storage] and the continued deployment of renewables, and it will under no circumstances be allowed to jeopardise our legally binding carbon budgets.”

An energy department spokeswoman said: “The projections only take account of policies for which funding has been agreed.”

The Observer has also learned that subsidies for new gas plants are very unlikely to be limited in the way that support for renewables is capped by Treasury rules. The so-called capacity mechanism compensates gas plants for operating intermittently as back-up for increasing amounts of wind and solar power. Ministers believe capacity payments are crucial to keeping the lights on and that a limit would be unworkable.

David Kennedy, chief executive of the Committee on Climate Change, the government’s official advisers, said a capacity mechanism was needed: “But you have to be very careful about its ambition. You don’t want this to trigger a [major] dash for gas and less low carbon investment.” The CCC has warned that extensive use of gas was “incompatible” with carbon targets and could therefore not be government policy.

Friends of the Earth energy campaigner Guy Shrubsole said: “Ed Davey has been caught writing a blank cheque to the gas industry. With the impacts of climate change becoming ever more obvious, this is precisely the wrong time to be committing public money to new fossil fuel investment.”

Last week, when appearing before the energy committee, Hayes declined to confirm that the government would meet a coalition commitment to develop four carbon capture storage demonstration plants. CCS is seen as crucial if the UK is to balance its backing for gas with environmental commitments.

“The government committed to supporting four CCS projects,” said Labour’s shadow energy minister, Tom Greatrex. “Yet this week’s announcement on CCS made no commitment to any support to the four projects.”

Privately, some in government think spending billions of pounds on the four plants would be difficult to justify in the current economic climate. But Stuart Haszeldine, professor of carbon capture and storage at the University of Edinburgh, said it was important that all four schemes went ahead.

Jeff Chapman, chief executive of the Carbon Capture & Storage Association, said: “To select less than four projects will deal another devastating blow to investor confidence.”


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Posted by admin - November 4, 2012 at 09:08

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UK shortlists carbon capture projects competing for £1bn fund

Four schemes shortlisted for the final phase of a government competition to develop the technology

Four schemes have been shortlisted for a £1bn competition to develop technology to capture and permanently store emissions from fossil fuel power plants.

Plans for new coal-powered stations with carbon capture and storage (CCS) at Grangemouth, Scotland, and Drax, North Yorkshire; a coal-powered project on Teesside and a bid to fit the technology on to an existing gas plant at Peterhead, Scotland, are on the shortlist, the Department of Energy and Climate Change (Decc) said.

The £1bn government competition had to be relaunched earlier this year after previous plans for the technology at ScottishPower’s coal plant at Longannet, Fife, were abandoned.

Ministers are depending on getting the technology working at scale as a major part of decarbonising electricity generation by 2030 in order to meet targets to tackle climate change.

It is hoped carbon capture and storage will be able to capture up to 90% of carbon emissions from fossil fuel power stations and store them underground in places such as old oil fields so they do not pollute the atmosphere.

Energy and climate change secretary, Ed Davey, said: “The projects we have chosen to take forward have all shown that they have the potential to kickstart the creation of a new CCS industry in the UK, but further discussions are needed to ensure we deliver value-for-money for taxpayers.

“Today’s announcement is an important step towards an exciting new industry, one that could help us reduce our carbon emissions and create thousands of jobs.”

Three of the shortlisted bids have also applied for European commission funding to develop carbon capture and storage, with the commission making a final decision on whether to support a UK project by the end of the year.

The bids were chosen from eight submitted. The four shortlisted schemes will be in negotiation with the government before a decision on which projects to support further is taken in the new year, Decc said.


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Posted by admin - October 30, 2012 at 16:06

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Letters: Cameron fuels new energy debate

While David Cameron attempts to legislate a solution for Britain’s energy problems, Professor Dieter Helm is pushing for gas and carbon capture (Comment, 19 October). Yes, gas is better than both coal, which produces twice as much CO2, and nuclear, with its serious safety issues. But Helm says gas is in near limitless supply. If so, why are energy companies now pushing to use fracking to extract that gas? Gas is like oil: even though there may be enormous quantities left, as time goes by, companies need to resort to ever more environmentally damaging methods (fracking, tar-sands, Arctic drilling etc) to get to those resources.

Every source of energy carries a cost. For gas, the cost is fracking – which involves pumping poisonous chemicals into the ground – and for many renewables such as wind-farms and tidal barrages, it is that they impinge on nature, and require great effort and resources to build and maintain. Why do we so rarely mention the most obvious path to energy sustainability, which would be to simply use drastically less energy? The problem seems to be that we love our gadgets, our cars, our cheap flights, our air-conditioned shopping experiences and our brightly lit cities so much that we can’t bear to limit even a little of our out-of-control creature comforts.
Alan Mitcham
Cologne, Germany

• Simon Jenkins suggests we should draw inspiration from Dieter Helm’s call for a dash for gas. Yet rises in the cost of gas have been responsible for more than 80% of the increase in consumer energy bills over the last five years. We have a fundamental choice about whether we want to build more energy or burn more energy. A recent study for E3G finds this relates not just to the volatile price of gas, but also to the risk of policy failure. Our analysis shows that if there is less energy efficiency, less CCS or less nuclear than the government is planning, then the cost of energy in a gas-heavy system could go up almost 100%. But if these policies fail under a renewables-heavy system, then the cost of energy to the consumer is likely to go up no more than 8%. The lesson is that gas is not a cheap option. A gas-based energy system carries a heavy risk of much higher costs for the consumer.
Nick Mabey
Chief executive, E3G

• Why the excitement over rising energy prices? When most of our energy is derived from finite resources of gas, oil and coal, the cost is bound to increase as resources get stretched. The real scandal is that poor have to pay a higher price per unit than the rich. The utility companies usually start with a standing charge and then progressively reduce the cost per unit as consumption rises. What the government should do is ban standing charges – after all, we don’t pay a standing charge to visit a petrol forecourt – and ideally insist that the cost goes up per unit as consumption increases. This would benefit the small careful user and would encourage the heavy user to be more prudent, making the raw materials last longer, while we build energy generators for the long-term.
Chris Hooper
Backwell, North Somerset

• Wouldn’t we all get cheaper energy bills if, instead of competing commercial firms, we had a single nationalised energy supply system (Just like The Thick of It – PM firms up energy tariff plans, 19 October)? Then, on top of the actual supply and administration costs, we wouldn’t have to pay for competitive advertising, many separate administrative systems, “churning” costs, profits, dividends, directors’ bonuses etc. Wouldn’t this cut the cost by at least 15%? Competition between energy supply firms is a myth, as they all change their prices in similar fashion and the only competition seems to be between them as to who can make the most profit, not who can provide the cheapest and most efficient service.
Michael Miller
Sheffield

• I wonder if Angela Knight expected her new job, as chief apologist for the energy industry, to be a doddle compared to her last job, as chief apologist for the banking industry?
Graham Jump
Guildford, Surrey


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Posted by admin - October 19, 2012 at 22:23

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Business bosses attack George Osborne’s policy of ‘dash for gas’

CBI warns of exposure to price rises on global markets and argues for more green projects

George Osborne was increasingly isolated over energy policy last night, after the head of the CBI said that too much reliance on gas as a future source of energy would leave consumers and businesses dangerously exposed to further sharp price rises on global markets.

After a week in which two of Britain’s biggest energy suppliers shocked customers by announcing increases of up to 9% on gas and electricity bills from next month, business leaders are warning that the chancellor’s enthusiasm for a “dash for gas” looks like a recipe for economic and environmental disaster.

In the latest blow to Osborne – before a crucial ministerial meeting to determine government energy policy this week – the director general of the CBI, John Cridland, said it was “crucial” to avoid too much reliance on one energy source, particularly if, as in the case of gas, much would have to be imported.

Many business leaders, together with the environmental lobby, argue that investment in green energy will not only be good for the UK economy in terms of investment and job creation, but will also mean the UK has more control over its own future energy provision, rather than being reliant on imports.

In a clear warning to the chancellor, who has made no secret of his support for greater use of gas and less government support for renewable energy, Cridland said: “Gas has a big part to play in the UK’s energy mix in the years to come, but we cannot become dependent on any one source of energy.

Over-reliance on new gas would leave us exposed to global price and supply fluctuations and jeopardise our carbon targets, so we need to build more of everything, including renewables, nuclear and CCS [carbon capture and storage].”

Last Monday, seven global electricity and nuclear technology companies, including Siemens and Mitsubishi Power Systems, threatened to withdraw hundreds of millions of pounds of investment in new energy projects in Britain because of uncertainties of about the government’s commitment to green, low-carbon policies. The withdrawal of so much investment would mean the loss of thousands of jobs. The firms said the lack of certainty and absence of decisions “have caused us to reassess the level of political risk in the UK”.

This Thursday, the so-called Quad of senior ministers, which includes David Cameron, Osborne, Nick Clegg and Danny Alexander, Lib Dem chief secretary to the Treasury, will meet to decide on the content of the energy bill, which aims to set the framework for a future of affordable, clean energy in the UK.

Sources say Osborne may push for cuts to offshore wind subsidies from government and for reductions in support for carbon capture and storage projects from four to two or even one, in return for agreeing a flexible decarbonisation target for the industry.

Joss Garman, the political director of Greenpeace, called on Clegg to stand up for the green agenda at the meeting: “When rocketing gas prices have already driven up bills for millions of families, and when both business and consumer groups are warning that gas is likely to get even more expensive, it would be idiotic for ministers to give the green light to a big increase in our reliance on pricey imports of this polluting fuel. The Liberal Democrats should insist on stabilising consumer bills with clean, home-grown renewables instead.”

Writing in today’s Observer, Lord Stern, author of the 2006 Stern review on the economics of climate change, said that, while subsidies for green energy would eventually have to end, it was “crucial” that any reductions in subsidies for low-carbon energy were not imposed so suddenly that they would “undermine the confidence of the private sector and hold back badly needed investment in the power sector”.Osborne’s support for a new dash for gas was revealed in a letter he wrote to Ed Davey, the Libl Dem energy and climate change secretary, in July.

“We need a statement which gives a clear, strong signal that we regard unabated gas as able to play a core part of our electricity generation to at least 2030 – not just providing back-up for wind plant or peaking capacity,” he wrote.

“This will provide context for the gas strategy and will help reassure investors, enabling investment in new gas power stations and the infrastructure that supports them such as pipelines between Norway and the UK which could enable us to become a gas hub.

“We should commit publicly to ensuring that British consumers will be able to get the benefits if the price of gas falls.”

However, speaking at an IMF/World Bank conference in Japan last Friday he admitted he was unhappy that energy prices were rising so fast: “Of course I’m concerned when I see electricity bills going up, partly that is because of things beyond our control – what’s happening in the world with oil prices and gas prices.”

Today an investigation by consumer magazine Which? finds that only one in 10 people can identify the cheapest energy deal when presented with a range of standard energy tariffs. When shown the tariffs in a simpler form, in the style of petrol forecourt displays, the number shot up to nine out of 10.

Only 8% of the people could identify the cheapest deal out of the six leading suppliers’ standard electricity tariffs, 60% got the answer wrong and 32% said they simply didn’t know.


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Posted by admin - October 14, 2012 at 08:32

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Carbon capture project is a big risk, says SSE boss

Ian Marchant, chief executive of Scottish-based utility, says government must invest more money in CCS technology

The boss of the only energy company still committed to investing in carbon capture and storage technology has called the pilot project the most risky investment of his career.

Ian Marchant, chief executive of SSE, warned that the government must invest more money in the project and said he would be happy to make sure no profit was made from using public funds.

Carbon capture and storage (CCS) is designed to catch CO2 from gas and coal-fired power stations before it is released into the atmosphere. The CO2 is liquefied and poured into disused oil wells in the North Sea via existing pipelines.

Marchant told MPs on the energy select committee last week: “I think we should be much more focusing CCS on capital support, at the lowest cost to the state, because I am not looking for a return on the capital I am putting forward.

“I have to put forward the capital into a risky project, the most risky project I’ll ever invest in. My shareholders will demand a high return. The state should not have to pay for that. It is much better to put capital support at this stage in that technology.”

Marchant’s comments will be a concern to the government, after Scottish Power’s decision to abandon its attempts to develop the technology last year. SSE and the oil group Shell are trying to create the country’s first CCS facility at an existing gas-fired power station at Peterhead in Aberdeenshire. Marchant told MPs more funding would be needed. “My own belief on CCS is we are at the demonstration stage and what is principally needed is capital support. We do not know that this technology will work. We need to demonstrate that it will work.”

The government has promised up to £1bn for companies willing to develop the first successful commercial-scale CCS pilot, and was approached by several interested parties when it launched the scheme in 2007.

ScottishPower and Shell appeared to be the frontrunners, spending about £20m on research into converting the coal-fired Longannet power station in Fife to collect the carbon dioxide emitted.

However, the project collapsed last year after the company said it would need at least £1.5bn to be viable, something the government refused to sanction. Shell then teamed up with SSE and hopes to use its Goldeneye gas field in the North Sea to store the liquified CO2.

The Department of Energy and Climate Change said last year: “Gas CCS will be an important part of our future energy mix and there are a number of promising projects, both gas and coal, in Scotland and England. We will be considering projects through an open and transparent selection process to be launched as soon as possible.”

Another pilot project in Peterhead, led by BP, was scrapped in 2007 after the company said funding from the government was insufficient.

CCS is thought to be especially important following recent discoveries of high levels of shale gas and the development of fracking, which is likely to extend the use of gas-fired power stations for decades.

According to the Scottish government, successful development of CCS technology could create up to 27,000 jobs by 2020.


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Posted by admin - June 17, 2012 at 21:22

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Ed Davey takes a swipe at George Osborne

Ed Davey hits out at chancellor’s ‘burden’ remarks and says green policies are ‘unashamedly good for growth’

Ed Davey, the energy secretary, took a veiled swipe at George Osborne’s views on the environment on Wednesday, as he pressed for the UK to take a lead in renewable energy.

“In some quarters, the green agenda is painted as an unbearable burden,” he said, apparently referring to the frequent public statements by the chancellor of the exchequer of the “burden” to businesses of environmental regulation. Osborne has been credited with a leading role in recent cabinet rows over green policies, as deep divisions have opened up within the Tory party between those who want to scale back green initiatives and those still committed to the agenda.

Some senior Tories are also understood to have suggested scrapping the government’s flagship “green deal” to insulate homes, the latest in a series of mis-steps that have highlighted the split.

Davey said: “We should make more strongly the business case for going green. Efficiency policies are unashamedly good for growth – using less resources lowers operating costs and frees up capital.” He pointed to Brazil, Germany, Korea, Mexico and Denmark as examples of successful policies.

His comments came as the Guardian revealed that the world is on track for 6C of warming – a catastrophic level that would lay waste to huge swaths of the planet – if current policies are not changed. The International Energy Agency (IEA) has found that progress on low-carbon energy has been much too slow to pull the world from the brink of dangerous climate change.

Davey was speaking at a meeting in London of energy ministers from more than 20 of the world’s biggest economies and greenhouse gas emitters on Wednesday.

He stressed the need for governments to “create the right frameworks for investment”.

But the news from the IEA – that the world is becoming more dependent on fossil fuels, not less – showed the scale of the challenge the ministers face.

One of the flagship technologies countries are relying on to prevent climate change is in particular trouble. Carbon capture and storage (CCS) is fledgling technology – as yet untried on a commercial scale – to take emissions from coal-fired power stations and store them deep underground.

But though companies and governments have been working on CCS for more than seven years, there are still no large-scale demonstration power plants.

Ambassador Richard H Jones, deputy director of the IEA, told the meeting the situation was “serious”. Numerous large CCS projects have been cancelled, including several in the UK, and none have yet got off the ground. “We need to be doing basic research on CCS, but we also need to be learning by doing – we need these large projects,” he said.

The US energy secretary, Steven Chu, called for higher efficiency standards for appliances around the world. In the US, some Republicans oppose higher efficiency standards for appliances and cars. But Chu said that some countries with efficiency standards were manufacturing low quality goods that were unsaleable in their country of origin because they failed to meet the standards. These goods were instead being dumped at a low price on countries without efficiency standards, thus damaging the buyer country’s domestic manufacturing industry and hurting consumers.

He said: “[Standards] are a no brainer. You will save your citizens money and you are cutting energy use.”

But he made clear he did not envisage a single globally enforced standard, but for countries to set their own.


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Posted by admin - April 25, 2012 at 20:49

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Nuclear and gas blow outs show where the dumb money is | Damian Carrington

The smart money is on energy efficiency and renewables yet a government terrified of “backing winners” appears happy to back the nuclear, oil and gas losers

Follow the money: in the billion-dollar world of the energy business that is good advice. So what do the collapse of a quarter of the UK’s new nuclear power plans and the gas still billowing dangerously from Total’s Elgin rig in the North Sea tell us about keeping the lights on and tackling climate change at a price we can afford?

It tells us first that, despite decades of lavish public subsidy, nuclear power remains uninvestable without heavy state backing. And second it tells us that even “safe” gas and oil fields pose serious risks, making the race to the ends of the Earth and the depths of the oceans for new fields a true fool’s errand.

E.on and RWE are huge, blue-chip multinationals, yet see nuclear as too big a gamble and that’s despite the substantial subsidy it would enjoy in the UK, alongside other low-carbon energy projects. When the free-marketeers at the Economist damn nuclear power as the “dream that failed“, you know you’re in trouble.

But that trouble may not just afflict the companies, but all of us who pay for energy. The French state-controlled giant, EDF, looks well-placed for a nuclear monopoly in the UK, and don’t forget it already has its own employees working right in the heart of government. As ministers found with the bungled attempt to get carbon capture and storage (CCS) off the ground, having one bidder for a contract leads either to failure or a fleecing.

Energy minister Charles Hendry sought to blame the German government’s abandoning of nuclear power, given that E.on and RWE are German companies. He was perhaps half-right: RWE mentioned that reason, E.on did not. In any case, as ministers point out on other occasions, the UK is competing internationally for the capital needed to build an energy system fit for the 21st century. The brutal truth is no nuclear power station has yet been built without state subsidy, and it remains a mystery to me why the UK should be the place to break that ignominious record.

Like nuclear, oil and gas has been showered with taxpayers money for many decades and still is. Even a conservative estimate by the International Energy Agency shows fossil fuels got $409bn subsidy in 2010, compared to $66bn for renewables. In the UK, fossil fuels get five times the subsidy of wind power.

Yet despite this, the inherent dangers of pumping highly explosive materials from under the oceans means accidents happen, from the gigantic blowouts like the Deepwater disaster in the Gulf of Mexico, to the weekly leaks that foul the North Sea. These cost money – lots of money – that you and I will end up paying through energy bills and petrol pump prices.

Even the worrying, but relatively minor, Elgin gas leak knocked about £5bn off Total’s share price and may cost billions to resolve.

E.on and RWE said they would focus on gas and renewables, not nuclear. This and the government’s recent “dash for gas” makes it vital for the new £1bn CCS competition to succeed. But don’t buy the shale gas hype: the money men at Deutsche bank are clear it will not crash gas prices in the UK as it has in the US.

Contrast all this with energy efficiency and renewables. The former makes sense by definition. The latter is where costs are coming down, even with the relatively limited subsidies they receive. And neither involve the Faustian pacts of nuclear power or oil and gas: they are as safe as the houses they power.

The UK government says nuclear power is essential to cutting our carbon emissions – although it has developed non-nuclear scenarios – yet plants that are never built are nothing but hot air. The goverment is also throwing money at oil companies to plumb the depths of the sea to the west of Shetland and to subsidise the clean-up of their own broken-down rigs.

Meanwhile, the major energy efficiency programme – the Green deal – employs an unsubsidised market mechanism that even the government’s official advisors say will fail. None of oil’s billions there to get the national refurb going. And renewable energy, booming around the world, has its support cut sharply at short notice or delayed. The government of course abhors the idea of “backing winners” but appears happy to back the nuclear, oil and gas losers.

If you want to rely on markets to deliver clean, secure and affordable energy, then you really do need to follow the money.


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Posted by admin - March 30, 2012 at 15:28

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US consortium to build carbon capture and storage plant at Grangemouth

Summit Power Group says Caledonia Clean Energy project will capture carbon emissions on 90% of production capacity

Plans for a new “clean coal” power plant close to Edinburgh have been unveiled by a US-led consortium that is hoping to capture nearly all its CO2 emissions when it begins operating.

The Seattle-based Summit Power Group has said it would build the new carbon capture and storage (CCS) power station near Grangemouth oil refinery but only if it wins substantial financial backing in the UK government’s next funding round for CCS proposals.

The proposal, dubbed the Caledonia Clean Energy project, is one of the most ambitious so far unveiled in the trouble-hit race to build a fully operational commercial carbon capture power station in the UK.

Several CCS proposals around the UK have been dropped, including what was then the most developed project at Longannet in Fife, and others have met intense opposition. A planning application by Peel Energy to partially fit CCS technology on a new coal-fired station in Ayrshire has had the largest number of objections in Scottish planning history.

Summit Power Group’s plans were given qualified approval from environmental groups on Wednesday. They applauded its decision to install at least 90% carbon capture from the start of operations but were highly critical of its parallel proposals to use that CO2 to increase North Sea oil production.

The company, which has teamed up with the UK based energy firms National Grid Carbon Ltd and Petrofac, said it eventually planned to use the CO2 to pump out hard-to-reach oil deposits from the bedrock in the St Fergus field, a process known as enhanced oil recovery.

WWF Scotland said it would support the project, but only if that element of the proposal was dropped. Dr Sam Gardner said this scheme could also help capture CO2 from the Grangemouth refinery and nearby industries, but its contribution to helping the climate would be significantly damaged by helping produce more oil.

The Royal Society for the Protection of Birds Scotland said this scheme was significantly more ambitious and serious than Peel Energy’s deeply unpopular proposal, which would start operating with just over 20% carbon capture.

But it said the risks to local wildfowl populations on the Firth of Forth could not be minimised. Aedán Smith, RSPB Scotland’s head of planning, said: “[Carbon capture and storage] must not be used to justify harm to our most important wildlife sites, either through direct damage as a result of new infrastructure, or by continuing our addiction to oil through unsustainable enhanced oil recovery.”

Summit Power Group is already involved in a 400mw “clean coal” project in Texas which won $450m (£284m) from the US Department of Energy in 2010 to develop an “extreme low-carbon” coal-based power plant, as a demonstrator project. Now under construction, that is already expected to use CO2 for enhanced oil recovery in Texas oil fields. The Scottish scheme would use a very similar design, the firm said.

The proposed power station would use a highly-efficient technique to “gasify” the coal to produce electricity power and hydrogen, said by the company to be “extremely low carbon”.

In a statement, it said: “The project site has been selected to take advantage of synergies with other facilities for industrial gas supply and to support CO2 capture. The location provides the benefit of being close to the UK North Sea for both CO2 storage and, later, enhanced oil recovery opportunities, and enables the re-use of existing pipelines.”

A spokesman said that assuming the UK government’s next competition for a share of £1bn in CCS funding was launched and completed this year, the plant could be operating by 2018, if it secured enough over-all funding.


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