Policymakers: Carbon capture and storage delays could cost the UK £40 billion per year

  • 23 Apr 2013, 12:30
  • Mat Hope

Credit: Images_of_money

The cost of decarbonising the UK's energy system could double if the government fails to develop carbon capture and storage (CCS) technology, according to a new report. It suggests the future of the UK's fossil fuel industry largely depends on the fate of the unproven technology.

Developing CCS

MPs and Peers representing parliament's three largest parties launched the Carbon Connect report yesterday afternoon. They said delays to bringing new nuclear power online may mean prolonging the use of fossil fuel plants to ensure the country has enough power.

But continuing to burn coal and gas in existing plants makes it much more likely the UK would miss its legally-binding target of reducing emissions by 80 per cent by 2050. That's where CCS comes in - the technology, which captures emissions and stores them underground could reduce the amount of greenhouse gases fossil fuel plants release into the atmosphere. 

Speaking at the report's launch, Professor Jim Skea of the Committee on Climate Change said this made CCS "absolutely critical" to the UK's efforts to decarbonise its energy sector. 

Despite the optimistic talk, CCS has yet to prove itself as a viable technology in the UK. The government's first competition to fund projects collapsed in 2011, and it is currently reviewing the feasibility of two short-listed projects having re-launched the competition last year - with a final decision due in 2015. 

These delays mean developing CCS quickly enough "is going to be a real difficulty" for the government, according to the co-chair of the Liberal Democrat's climate change committee, Lord Teverson. 

£40 billion

CCS is key to meeting government emission targets in the cheapest way possible. According to the report, which is based on calculations by the Energy Technology Institute, failing to develop CCS could cost the UK economy between £30 and £40 billion each year by 2050 - about one per cent of GDP. 

The report assumes the UK would meet its 80 per cent emissions reduction target, and looks at alternative ways to do this if there is no CCS. It shows a greater amount of costly renewables like offshore wind would be needed as coal and gas could hardly ever be used. Future industrial emissions would also be much higher without CCS, further squeezing the amount of time fossil fuel plants could be run. 

Jonathan Holyoak, the Department of Energy and Climate Change's Head of CCS and fossil fuel generation policy, said this means there is simply "no long term future [for fossil fuels] without carbon capture and storage".

Running out of time

Former energy minister Charles Hendry acknowledged there is "no easy option" to put the UK on a low carbon path. And Labour's shadow energy minister, Tom Greatex MP, criticised the government for "grappling with debates" over the direction of policy, rather than working out the details for the "broadly shared goal" of decarbonising the UK's energy sector. 

Time is running out. So if the government is going to rely on CCS, Labour peer Baroness Worthington says it must now "get on and prove it".

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