20th December 2023, London
Today the Department of Energy Security & Net Zero published its CCUS Vision and updates on the cluster sequencing process, to “set out plans for a new competitive UK carbon capture, usage and storage market by 2035 – delivering new jobs and supporting net zero.”
Key updates in the announcement were:
– Invitation for expressions of interest for Track-1 cluster expansion in the Hynet cluster
– Agreed commercial terms with the Northern Endurance Partnership
– A streamlined process for Track-2 cluster anchor projects to deploy from 2028-2029
– Competitive allocation process for carbon capture projects from 2027
– Plans to enable CO2 transport by ship, road and rail and support longer term cross border CO2 transport
– Details on the proposed commercial frameworks and alignment of the GGR and Power BECCS Business Models, alongside indicative Heads of Terms
– An industry led working group to look into further reduction of capture costs will be established
The Government’s CCUS Vision references the work of the industry, led by the Carbon Capture & Storage Association, in its Delivery Plan 2035 and accelerating deployment proposals put forward to the CCUS Council. Voices from across the UK CCUS industry have commented on the announcements, praising this crucial step forward and urging for continued momentum to deliver the aims of the Vision.
Ruth Herbert, Chief Executive, CCSA said:
“We welcome the government’s CCUS Vision published today, setting out a long-term strategy for the UK’s CCUS industry to be able to store over 50Mt a year by 2035 to support the decarbonisation of domestic industries and take advantage of export opportunities.
“It is great to see CO2 transport by ship, road and rail will be enabled from 2025 onwards, as well as cross-border CO2 transport. which will also support longer-term cross-border CO2 transport solutions.”
“The CCSA Delivery Plan detailed a development pipeline of over 90 carbon capture projects. Those project leaders will welcome the commitment to allocation rounds from 2027, provided they are of sufficient frequency and volume to unlock continued investment. We look forward to building on this pipeline through the proposed industry working group.”
“Investors need to see accelerated progress on the first four CCUS clusters. Today’s other announcement, inviting expressions of interest for Track-1 cluster expansion in the HyNet cluster is very welcome, along with the government’s agreement of Heads of Terms with the East Coast Cluster (ECC). It is also good to see a more streamlined process for selecting Track-2 cluster capture projects. Projects on the East Coast will need more clarity on the timescales going forward for both Tracks if we are to meet the UK’s 2030 target to reach 20-30Mtpa by 2030.”
David Parkin, Director, Progressive Energy said:
“We very much welcome Government’s announcement on HyNet Track 1 expansion, which will provide further opportunity for industrial decarbonisation in the NW region, while optimising value for money for the taxpayer by maximising use of the HyNet assets.”
“More broadly, the CCUS Vision document help sets a roadmap for longer term expansion of carbon storage, which will enable a much broader range of industries across the region decarbonise and open up storage opportunities across the Irish Sea. This will enable vital industries, such as the cement and lime sector in the Peak District, to decarbonise through CCS in the medium term.”
Luciano Vasques, Managing Director, ENI UK said:
“We see strong demand from businesses across the UK for CCS so today’s announcement is a welcome step forward. We look forward to providing transportation and storage at HyNet for a wider range of companies in North West England and North Wales, helping them to reduce CO2 emissions, protect local jobs and boosting industrial competitiveness for the region.”
Chris Daykin, General Manager, Northern Endurance Partnership said:
“Today’s announcements mark another positive milestone in the development of the East Coast Cluster and the UK CCUS industry.”
“Agreeing the key commercial principles through the Heads of Terms is a crucial step in the decarbonisation of the North East region and delivering jobs. We look forward to the expansion process launching from 2024 and agree that the selection of projects by HMG should be matched to the available transportation and storage capacity, so that projects and stores are developed at the same pace and equivalent level of maturity”.
“We thank the UK Government for their continued support as we work to complete the final agreements in the coming months, enabling NEP to take Final Investment Decision in September 2024”.
Louise Kingham, UK Head of Country and senior Vice President of Europe, bp said:
“We welcome the announcement of the UK government’s CCUS Vision, which sets out a bold plan for making the UK a global leader in carbon capture, utilisation and storage, as well as the positive steps forwards announced for both Track 1 and Track 2 CCUS clusters. CCUS has an important role to play in helping the UK deliver on its net zero targets and bp is committed to continuing to make progress on its projects, and helping to ensure this vital industry can deliver on its significant potential.”
Graeme Davies, Project Director, Viking CCS said:
“Today’s announcement on the progress towards Track 2 capture project selection marks another significant step forward for the Viking CCS project, and the development of the UK’s carbon capture and storage industry, which is critical to delivering the energy transition.”
“We look forward to continuing with this positive momentum towards bringing greater clarity on investment across the CCS value chain in Track 2, for both the anchor projects and the Viking CCS network.”
Jonathan Briggs, Director of Development & Delivery, VPI said:
“We welcome this news that the government plans to move forward at pace with a track 2 CCUS deployment process next year. As one of the principal participants of the governments Industrial Decarbonisation Challenge program run by UK Research Innovation, VPI’s Humber Zero project has completed its early engineering and FEED program and is ready to move forward into construction as an anchor project to the Viking CCS cluster next year.”
“We are delighted to support the CCUS vision, we are looking forward to working with all parties through 2024 developing the industry to a sustainable and accelerated level of capture in the future. At MNZ we are focussed on developing a safe, low cost and scalable CO2 storage solution to exceed the 2035 targets and beyond. The target of an additional 6MPTa per year from 2031 is achievable and aligned to the MNZ and Peak Cluster solution which we are excited to bring to the UK’s CCUS industry.”
Simon Holt, Manager, Emerging Energy Europe, Phillips 66 said:
“We welcome the UK Government’s announcement on the Track 2 process for carbon capture and storage (CCS).”
“This is a positive step forward and we look forward to continuing our work with Viking CCS and the UK Government on delivering CCS for the Humber region. This will support us to reduce our operational emissions as we deliver vital products for the EV supply chain and lower carbon transport fuels.”
“We believe energy security is crucial for the UK to continue to grow and flourish and CCS will play a vital role in this.
Ben Burggraaf, CEO, Net Zero Industry Wales said:
“Net Zero Industry Wales has welcomed the UK Government’s announcement that Non-Pipeline-Transport (NPT) solutions, e.g. the shipping of CO2, projects will be eligible for selection as capture projects from 2025 onwards and intent to provide clarity on the timeframe for the deployment as soon possible, to allow projects to progress”.
“Deploying NPT solutions, to ship the captured CO2 in South Wales to a permanent store at the East Coast of England & Scotland, is pivotal to kickstarting the delivery of the South Wales Industrial Cluster Plan and delivering a net economic impact of £7.9 billion over 20 years”.
A spokesperson for Acorn said:
“We welcome the publication of the UK Government’s Vision to establish a competitive carbon capture, usage and storage (CCUS) market.
“In particular we appreciate that DESNZ is continuing to take a pragmatic approach to drive Track 2 forwards, and we look forward to continuing to engage constructively with the DESNZ team and the emitters who will connect to Acorn over the coming months.
“We look forward to working with Government to create and future-proof jobs, attract inward investment, develop green-tech industries, and crucially, help decarbonise Scotland and the UK.
“The CCUS Vision sets a clear direction – we now need to see pace and momentum on delivery.”
Catherine Raw, Managing Director of SSE Thermal said:
“It’s positive to see the publication of the UK Government’s CCUS Vision. This sets out a long-term strategy for creating a CCUS market which will be fundamental for delivering a reliable, decarbonised power sector, and providing security of energy supply in the transition to net zero. It is particularly welcome to see Government recognise the need for multiple additional power CCUS projects by 2030.
“The UK Government’s decision to progress Track 2 clusters in early 2024 should see the Scottish Cluster progress, providing opportunities for Peterhead Carbon Capture Power Station to access CO2 transport and storage infrastructure by 2028-29, and enabling the delivery of Scotland’s decarbonisation targets. The reality is that the UK will need around ten new power stations like Peterhead Carbon Capture to successfully decarbonise, alongside other technologies like hydrogen, by 2030.
“As the UK’s most carbon-intensive cluster and one of the UK’s industrial heartlands, the Humber remains a key strategic location for decarbonisation. It’s important that UK Government provides further detail on the approach to delivering much needed CCS infrastructure to this region beyond the initial projects already identified. This will enable projects like Keadby 3 Carbon Capture Power Station, and our newly formed hydrogen production joint venture with Kellas Midstream, H2NorthEast, to continue to develop at the pace required. We look forward to further updates early next year.”
Neil McCulloch, CEO, Spirit Energy said:
“We are delighted to support the CCUS vision, we are looking forward to working with all parties through 2024 developing the industry to a sustainable and accelerated level of capture in the future. At MNZ we are focussed on developing a safe, low cost and scalable CO2 storage solution to exceed the 2035 targets and beyond. The target of an additional 6MPTa per year from 2031 is achievable and aligned to the MNZ and Peak Cluster solution which we are excited to bring to the UK’s CCUS industry”.
Tom Glover, UK Chair, RWE said:
“RWE welcomes the launch of the Government CCUS Vision. We’re pleased to receive further clarity on the Track One expansion, and an update on Track Two of the Government’s Cluster Sequencing Process. These announcements mark a milestone in the development of the UK’s Carbon Capture economy and provide important clarity for companies that are advancing pioneering carbon capture projects.
As a key partner in the decarbonisation of the UK’s energy networks, RWE is actively developing projects to retrofit carbon capture technology at its existing combined cycle gas-fired power stations at Pembroke and Staythorpe. In addition, we are developing a new combined cycle gas turbine (CCGT) generating plant with carbon capture at Stallingborough, located close to the Humber Estuary.
These projects are key to the energy transition, and could deliver over 4.7GW of decarbonised, flexible and reliable generation, with captured CO2 being safely transported by either pipeline, in the case of Staythorpe and Stallingborough, or by shipping from Pembroke, to one of the UK storage networks. We are a key partner in the Viking CCS project and will continue our engagement with them as we progress Staythorpe and Stallingborough as key expansion projects for that network.
We welcome the requirement for ‘Track-2’ stores to demonstrate the potential to receive and store CO2 delivered via shipping. South Wales is home to a significant industrial base of national importance, including our Pembroke CCUS project. The capability to access CO2 storage via shipping will be critical to decarbonising the South Wales economy and strengthening employment prospects in the region.
We look forward to further engagement with government on the Track 2 stores to ensure that CO2 from Pembroke can be included in the proposed 2025 competition round.”
Tom White, CEO, C-Capture said:
“We welcome the improved clarity for carbon capture projects. This will enable new technology to be deployed and enter the supply chain, creating new sources of value for the UK economy”.
Simon Hicks, CEO, Evero Energy Group said:
“This is great news for Evero, the North West and the UK’s transition to net zero. Evero has multiple projects across the North West of England that are eligible for this round of government support. Our pathfinder InBECCS project would generate as much as 250,000 tonnes of engineered carbon removals a year, once operational in 2029.”
“Fitting CCUS across our wider portfolio would enable us to capture a million tons of carbon a year – making a material contribution towards the Government’s Greenhouse Gas Removals targets.”
Notes to Editors
CCUS, or Carbon Capture, Utilisation and Storage, is a key low carbon solution – vital to meeting the UK’s statutory Net Zero target at least cost. CCUS enables the production of clean power, clean products (such as steel and cement) and clean hydrogen – which can then be used to decarbonise heating and transport. In addition, CCUS also enables greenhouse gas removal from the atmosphere through Direct Air Capture with Storage (DACS) or Bioenergy with CCS (BECCS).
The CCSA is the trade association promoting the commercial deployment of CCUS. We work with members, governments and other organisations to ensure CCUS is developed and deployed at the pace and scale necessary to meet net zero goals and deliver sustainable growth across regions and nations.
The CCSA currently has over 100 member companies who are active in exploring and developing different applications of carbon capture, CO2 transportation by pipeline and ship, utilisation, geological storage, and other permanent storage solutions, as well as members from management, legal and financial consulting sectors.
To find out more about the Carbon Capture Storage Association (CCSA) please visit the CCSA website at http://www.ccsassociation.org/