UK Picks Two CCS Projects For Government Funding
The UK government has selected two clusters that will receive funding and develop their proposed carbon capture usage and storage projects from 2025.
The UK Prime Minister’s 10 Point Plan established a commitment to deploy CCUS in a minimum of two industrial clusters by the mid-2020s, and four by 2030 at the latest. The target is to capture and store 20-30 MtCO2 per year by 2030.
Earlier this year, the government started a decision process to see which project it would support. Track 1 would start decarbonizing the industry from 2025 and Track 2 would start from around 2030.
The government’s cluster sequencing process has, through the $1.4 billion CCS Infrastructure Fund, completed the first phase of the evaluation of the five cluster submissions received.
The East Coast Cluster (ECC) and HyNet have now been named as the UK’s first two carbon capture, usage, and storage clusters following a successful bid to the Department for Business, Energy & Industrial Strategy (BEIS). They will now start Track 1 negotiations.
Greg Hands, Minister of State for Energy, Clean Growth & Climate Change, said: “If the clusters represent value for money for the consumer and the taxpayer then subject to final decisions of Ministers, they will receive support under the government’s CCUS Program.”
The Scottish Cluster will be a reserve cluster if a backup is needed. This cluster meets the eligibility criteria and as such, the government will continue to engage with the Scottish Cluster throughout Phase-2 of the sequencing process, to ensure it can continue its development and planning. This means that if the government chooses to discontinue engagement with a cluster in Track 1, it can engage with this reserve cluster instead.
Both the East Coast Cluster and HyNet were named as Track 1, putting them on course for deployment by the mid-2020s. In a separate statement, HyNet said that it chose to proceed with decarbonizing the North West and North Wales from 2025.
“From as soon as 2025, the project will enable our manufacturing sector across the region to decarbonize, as well as providing the opportunity to transition the way we travel and how we heat our homes. HyNet brings huge economic benefits, safeguarding existing jobs across the region and creating around 6,000 new employment opportunities to support the leveling up of the UK,” David Parkin, HyNet Project Director, said.
“The project partners are ready to deliver and, as one of the first industrial decarbonization clusters, we will play a big part in shaping the country’s hydrogen economy, positioning the UK as a global leader in the sector. We are looking forward to working closely with Government and the other clusters to deliver and grow the infrastructure as rapidly as possible, both in breadth and depth, over the coming years,” Parkin added.
HyNet is led by Italian energy major Eni and several partners like Essar, Progressive Energy, Cadent, and Intergen.
“The UK Government has recognized the importance of the contribution that the HyNet project can make to the decarbonization of pivotal activities in the country. We must be pragmatic to address the challenges that face us ahead: starting immediately and powerfully with the tools we currently have to decarbonize traditional sources today, while investing heavily in technology to develop and improve new sources for the future,” Eni CEO Claudio Descalzi stated.
As for the East Coast Cluster, it will support low-carbon industry and power projects across the region, including those in Net-Zero Teesside and Zero Carbon Humber. Once operational, the cluster has the potential to transport and securely store nearly 50 percent of all UK industrial cluster CO2 emissions – up to 27 MtCO2 emissions a year by 2030.
The project aims to create and support an average of 25,000 jobs per year between 2023 and 2050, with approximately 41,000 jobs at the project’s peak in 2026.
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