Oil and gas – guidance

UK carbon capture and storage: government funding and support

How the government supports the design, construction and operation of commercial-scale CCS.

CCS Commercialisation competition

The UK Carbon Capture and Storage (CCS) Commercialisation competition makes available £1 billion capital funding, together with additional operational funding through the UK Electricity Market Reforms, to support the design, construction and operation of the UK’s first commercial-scale CCS projects. This will:

  • generate learning that will help to drive down the costs of CCS
  • test and build familiarity with the CCS specific regulatory framework
  • encourage industry to develop suitable CCS business models
  • contribute to the development of early infrastructure for carbon dioxide transport and storage

The current competition opened in April 2012, and closed to bids in July 2012. Four full chain (capture, transport and storage) projects were shortlisted in October 2012. On 14 January 2013, all the shortlisted bids submitted revised proposals. On 20 March 2013 the government announced two preferred bidders, the White Rose Project and the Peterhead Project, who in December 2013 and February 2014 respectively were awarded multi-million pound contracts to undertake Front End Engineering and Design (FEED) studies. FEED is a programme of detailed engineering, planning and financial work to finalise and de-risk aspects of the proposal ahead of taking final investment decisions, and proceeding to construction.

White Rose

The White Rose CCS Project is in Yorkshire, England. This project involves capturing around 90% of the carbon dioxide from a new super-efficient coal-fired power station at the Drax site in North Yorkshire, before transporting offshore and storing it in a saline rock formation beneath the North Sea. The project developers are Capture Power Ltd. (a consortium of Alstom, Drax Power and BOC) and National Grid.

If built, the planned c.£2 billion state-of-the-art coal power plant with full CCS could provide clean electricity to more than 630,000 homes, capturing approximately 2 million tonnes of carbon dioxide per year. The proposal also includes the development of a large capacity pipeline - the Yorkshire Humber CCS Trunkline - which will have capacity for additional carbon capture projects in the area.

On 8 July 2014 the European Commission announced a €300 million (around £240 million) grant for the White Rose CCS project. The funding comes from the New Entrants Reserve (NER 300) programme managed by the European Commission, European Investment Bank and member states.

Peterhead

The Peterhead CCS Project is in Aberdeenshire, Scotland. This project involves capturing around 85% of the carbon dioxide from an existing combined cycle gas turbine (CCGT) power station at Peterhead, before transporting it offshore and storing it safely in the Goldeneye depleted gas field 2.5km beneath the North Sea. The project developer is Shell, with SSE. The Peterhead CCS project is the world’s first planned CCS project on a gas power station. If built, the project would capture 1 million tonnes of CO2 each year and provide clean electricity to over half a million homes.

More information about the project (including the press release) can be found on GOV.UK or by visiting the Peterhead CCS Project – Shell UK

Following the FEED studies, in late 2015 the companies will take final investment decisions with the government taking funding decisions shortly after.

Supply chain

Working with partners such as the Energy Industries Council (EIC), we are looking to put on a number of events to highlight the supply chain opportunities associated with the projects in the CCS Commercialisation Competition (Peterhead and White Rose). Our first event was a London based CCS Showcase event held on 12 May 2014, for more information about this and future events please go to the Energy Industries Council website.

CCS research and development

CCS research, development and innovation will play an important role in reducing the costs of CCS, by developing cheaper and more efficient technologies and components, and contribute to characterising storage sites.

The UK has a 4-year (2011-2015) £125 million cross-government CCS research, development and innovation programme. Funding comes from the Department of Energy and Climate Change (DECC), the Technology Strategy Board (TSB), the Energy Technologies Institute (ETI) and the Research Councils. It covers:

  • £62million to support fundamental research and understanding
  • £28million to support the development and demonstration of CCS components and next generation technologies (such as turbines or new solvents to capture the carbon dioxide)
  • £35million for pilot scale projects to bridge the gap between research and commercial scale deployment

In total, over 100 separate projects are being funded through this programme. A full list of these can be found on our project diagram (and database).

Cross-government CCS R&D Programme 2011-2015: list of projects.

Additionally, £2.5m has been made available to develop North Sea CO2 storage. This new funding from DECC’s Innovation Fund, will be delivered by the Energy Technologies Institute (ETI). Full details can be found on the Energy Technologies Institute website.

Also, as part of Phase 4 of the Energy Entrepreneurs Fund (EEF), £5m has been available in the financial year 2015/16, to support the development and demonstration of state of the art technologies, products and processes. Up to £2.5m of this funding has been prioritised for projects focused on CCS and related technologies.

Fundamental research and understanding

The £62million for fundamental research includes:

  • c. £13 million UK CCS Research Centre that brings together over 100 of the UK’s top CCS academics to promote and coordinate UK CCS research capability and increase academic collaboration with industry
  • a new UK Storage Atlas covering nearly 600 offshore UK storage sites with store-by-store data, the basis for the British Geological Survey (BGS) and The Crown Estate’s UK CO2 Storage Evaluation Database: CO2 Stored

Component development and applied research

The £28 million for developing and demonstrating cheaper CCS components includes:

  • world class research facilities at the UK CCS Research Centre’s “PACT” facilities
  • new metering technology project for CO2 transport by pipeline, led by Heriott-Watt University
  • new CO2 monitoring technology project for storage sites that uses cosmic rays led by Durham University.

Pilot scale projects

The £35 million for pilot scale projects to bridge the gap between research and commercial scale deployment includes:

  • the Ferrybridge Carbon Capture pilot project, a 5MWe amine post-combustion plant attached to SSE’s coal fired Ferrybridge power station – the first capture project of any type at this scale in the UK,which captured up to 100 tonnes of CO2 a day
  • next-generation capture using “carbon water exchange” technology developed by Future Environmental Technologies (FET), to be tested on a Combined Heat and Power unit at the Solutia manufacturing plant, Newport
  • saline aquifer characterisation, at a site in the Southern North Sea
  • testing innovative Measurement, Monitoring and Verification (MMV) technology – more details to be announced shortly.

Information about previous CCS innovation funding programmes and projects can be found in the National Archives.

Ferrybridge Carbon Capture Pilot (CCPilot100+)

Following completion of its construction phase, the Ferrybridge Carbon Capture Pilot (CCPilot100+) was launched on 30 November 2011 as a collaborative project between government and industry. The project tested amine based post combustion capture (PCC) technology on real flue gases from Scottish and Southern Energy’s (SSE) Ferrybridge coal and biomass power station, capturing up to 100 tonnes CO2 per day. The project completed its two year test programme in December 2013 to optimise the process and components, and develop performance models.

Ferrybridge is a significant step forward in the world of CCS as a critical bridge between research and commercialisation.

The aim of the project is to prove the application of the amine solvent post combustion capture process under realistic operating conditions. It will also enable us to gain knowledge that will be invaluable in the near-term scale up and deployment of CCS and move us closer to our long term aim of cost competitive CCS deployment in the 2020s.

Ferrybridge key facts

  • Project partners: Scottish and Southern Energy PLC, Doosan Babcock and Vattenfall
  • Technology: solvent (amine) based post combustion capture
  • Fuel: coal /small proportion of biomass
  • Capacity: extracts up to 100 tonnes CO2 / day from a power station flue gas stream equivalent to 5MW electrical power. Total power station output = 2000MW electrical.
  • Efficiency: around 90% of CO2 removed from flue gas
  • Project budget: more than £20 million
  • Public funding: more than £6 million from DECC, TSB and Northern Way

Information about previous CCS innovation funding programmes and projects can be found in the National Archives:

CCS European funding opportunities

Horizon 2020 is a new innovation funding mechanism which replaces existing European Commission funding mechanisms for research and innovation e.g. Framework Programme 7 (FP7), with one single programme from 2014 – 2020. There are a number of calls now open which include opportunities for CCS projects:

Visit the European Commission’s Horizon 2020 website for a comprehensive list of calls.

Further help and information on Horizon 2020: The UK Government-funded helpline – EU Energy Focus – can offer free support and advice on the application process, and offers a proposal review service. EU Energy Focus is contactable at: mail@euenergyfocus.co.uk or Telephone 0845 6000 430.

The Technology Strategy Board has also published Horizon 2020 guidance.

New Entrants Reserve (NER 300) is a European funding programme to support the development of carbon capture and storage (CCS) and innovative renewable energy technologies. It is a two-phase programme funded through the sale of EU ETS allowances. The second call award decision was announced on 8 July 2014. For more information visit the European Commission’s website NER first call and NER second call.

Tees Valley City Deal

On 13 December 2013 the Prime Minister announced agreement on the Tees Valley City Deal, which includes funding for a feasibility study on industrial CCS in the area. The deal seeks to further develop Tees Valley’s current leadership in energy intensive, high value industries; and is led by Tees Valley Unlimited, the Local Enterprise Partnership LEP. Tees Valley funding is separate and additional to the Department of Energy and Climate Change’s £1bn CCS Commercialisation Programme

Electricity Market Reform

Electricity Market Reform (EMR) is our initiative to make sure the UK remains a leading destination for investment in low-carbon electricity.

Read more about EMR.

CCS Cost Reduction Task Force

The task force was set up in spring 2012 to advise the government and industry on the steps needed to reduce the cost of CCS, so it can compete with other low carbon technologies in the 2020s.

Read more about the CCS Cost Reduction Task Force.

CCS knowledge sharing

The government is committed to sharing the knowledge from UK CCS projects and to learning from other projects around the world to help accelerate CCS cost reduction, as well as sharing information from the reports it commissions.

Knowledge from White Rose and Peterhead CCS projects

A Front End Engineering and Design (FEED) study is a detailed programme to thoroughly develop a proposal ahead of taking final investment decision. We will share the information from the White Rose and Peterhead FEED studies as part of the government’s commitment to sharing knowledge and learning from UK CCS projects.

Knowledge and learning from the White Rose and Peterhead FEED studies will cover aspects of delivering a large scale commercial CCS project, including commercial arrangements and financial options; programme and risk management; consent and permitting; technical design, engineering and integration; health and safety; and lessons learnt.

We will be making FEED study material available at appropriate stages of the programme, once each area of work has been completed.

Knowledge from Kingsnorth and Longannet CCS projects Since 2011the government has made available substantial amounts of information from the engineering and design studies (known as FEED) of previous CCS projects funded by the government.

Kingsnorth FEED

Longannet FEED

Commissioned CCS Reports

CO2 Storage Liabilities in the North Sea - An Assessment of Risks and Financial Consequences

UK Canada Joint Statement on Carbon Capture and Storage CCS

Regulatory regime

The Energy Act 2008 provides for a licensing regime that governs the offshore storage of carbon dioxide. The regime applies to storage in the offshore area comprising both UK territorial sea and beyond designated as a gas importation and storage zone (GISZ) under section 1(5) of the Act.

The Secretary of State for Energy and Climate Change is the licensing authority for offshore storage except within the territorial sea adjacent to Scotland, for which Scottish ministers authorise. The required forms and guidance documents are listed in the Carbon storage licensing guide.

In December 2010 the government consulted on implementing the Third Party Access Provisions of the CCS Directive and called for evidence on long term development of CCS infrastructure. This consultation, together with the regulations and guidance is published on the GOV.UK website.

CCS Development Forum

DECC ministers also chair a CCS Development Forum. Its remit is to help overcome barriers to CCS by bringing DECC and stakeholders together.

Read more about the CCS Development Forum.