THE GOVERNMENT has pledged £1bn of public funding towards its latest attempts to kick-start the fledgling carbon capture and storage (CCS) industry.
Energy secretary Ed Davey yesterday invited companies to pitch designs for safely storing emissions from fossil fuel power stations, with an initial £1bn capital funding and £125m in research cash up for grabs.
He said the technology could be worth £6.5bn to the UK economy in the next decade.
The government abandoned its first plans for a CCS competition in October after Scottish Power pulled out in a disagreement over spiraling costs.
“One of the criticisms of the previous competition was that we weren't flexible enough, and so what this one is really about is listening to the industry more, being a bit more flexible and looking at what’s actually going to work,” said a DECC spokesman.
Companies have until 3 July to submit applications for the latest scheme, which if successful will allow the UK to continue using fossil fuels to generate electricity while keeping up with international emissions targets.
The stations are not expected to be up and running until at least 2016.
Firms will also be eligible for further support through a minimum electricity price to be awarded to projects through contracts for difference.
The Institute of Directors welcomed the new competition, but added: “[W]e still don’t know if CCS is commercially viable. The government is right to be pressing ahead, but businesses need to see a fallback plan if CCS eventually proves unworkable.”