Britain warns CCS industry of lower subsidies — Climate Home News
The UK government has warned representatives of the carbon capture, utilisation and storage (CCUS) industry that state financial support may decrease in the future. Junior minister at the Department for Energy Security and Net Zero Martin McCluskey said this at the annual Carbon Capture and Storage Association conference in Westminster, Climate Home News reports.
According to McCluskey, the next stage of the CCUS programme will take place amid difficult budget decisions. He noted that the government must direct public investment where it delivers the greatest value, as well as determine the priorities, sequencing and pace of project implementation.
Call to reduce costs
Stephanie Murphy, head of industrial carbon capture and storage at the ministry, acknowledged that the government will probably be unable to continue supporting new CO2 transport and storage projects at the previous level. She urged companies to reduce costs and demonstrate the benefits of projects through job creation and the economic recovery of deprived areas.
According to the publication, the UK government is reportedly considering cuts to funding for certain emissions-reduction programmes amid plans to increase military spending. Areas that may face cuts include subsidies for carbon capture and heat pumps.
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Industry depends on state support
Olivia Powis, chief executive of the Carbon Capture and Storage Association, said that weakening government commitments could force investors and developers to seek opportunities in other countries. Eoin Devane, acting director of net zero at the Climate Change Committee, said that the UK relies on CCS to meet its carbon budgets and its net-zero target by 2050, but current plans are insufficient for this.
CCS involves capturing carbon dioxide from concentrated sources, such as cement kilns, transporting it and injecting it into underground storage facilities. The technology is considered necessary for part of industrial emissions that are difficult to eliminate through renewable electricity, but the Intergovernmental Panel on Climate Change calls it one of the most expensive ways to reduce emissions.
Conference participants stressed that the sector continues to need funding. Among possible sources of revenue, they named a higher price for carbon emissions, the sale of carbon credits and a premium for products with a lower carbon footprint, including cement.
