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Another investment project in Yorkshire could fall by the way side

October 7, 2013

Carbon capture and storage (CCS) is a process which prevents carbon dioxide being pumped into the atmosphere by storing it deep underground. A few years ago the EU suddenly got excited by the technology and committed to having up to twelve CCS demonstration projects across Europe in operation by 2015.

Although thirteen projects applied for the first phase of funding only one, the ‘White Rose’ in Yorkshire, remains in the running for €300m of EU support. Public consultation by the White Rose project started in the summer while at the same National Grid is taking its own plans (for a pipeline to transport CO2 to undersea storage facilities at a North Sea site) out to consultation too. The projects would reinforce the vision that Yorkshire is becoming a hub for ‘green energy’ but their viability depends on finance from the UK government.

The UK government has shortlisted two CCS projects (White Rose and one in Peterhead, Aberdeenshire) which will progress to the next stage of a competition for up to £1bn of government investment. The government will decide on which projects will get funding in early 2015. Up to two projects will be funded from the £1bn pot. Two further bids are held in reserve.

There is a fear that the projects will never actually get off the ground.

A northern Lib Dem MEP has said: “the odds are against it (the White Rose project) securing the necessary government commitment within the given deadline”.

Carbon prices have collapsed as a result of the economic recession and therefore so has the financial support for CCS. Trial projects in both Canada and Norway have been abandoned recently as costs have soared and as lower than expected North American gas prices, brought on by the shale gas revolution, made the Canada project, specifically, uneconomic.

All this comes at a time when the Intergovernmental Panel on Climate Change confirms that global warming is real and man-made. Whatever the environmental case for and against CCS though, the fact is the Government has made a commitment to supporting the technology. EU funding is there for the White Rose project and it needs a similar funding commitment from Whitehall. We hold our breath, however, because we have seen over the past couple of years that when Yorkshire is up against Scotland (locating the Green Investment Bank and the Tour de France, for example), Scotland is always London’s preferred benefactor. This is another development which screams out for devolved powers to help make it happen. Relying on Whitehall is never a solution.

 

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