Government should get serious about CCUS – BEIS Committee

The government needs to move away from ‘vague and ambiguous’ targets and give a clear policy direction to ensure that the UK seizes the industrial and decarbonisation benefits of carbon capture usage and storage (CCUS), according to the Business, Energy and Industrial Strategy (BEIS) Committee in a new report.

The report: Carbon Capture Storage and Usage: third time lucky? says CCUS is necessary to meet national and international climate change targets at least cost, and argues that the technology could play a significant role in supporting productivity growth outside London and the South East.

The UK is considered to have one of the most favourable environments globally for CCUS, but the technology has suffered from 15 years of turbulent policy support, including the cancellation of two major competitions at a late stage, says the report. And no commercial-scale plant has yet been constructed.

The report suggests that failure to deploy CCUS could double the cost to the UK of meeting its targets under the Climate Change Act, rising from approximately 1% to 2% of GDP per annum in 2050. Failure to deploy the technology would also mean the UK could not credibly adopt a net-zero emissions target in line with the 2015 Paris Agreement’s 1.5°C aspiration.

The report finds there is a lack of clarity concerning the government’s ambitions for CCUS, both in terms of time-scale for deployment of the technology and the level of cost reductions the government is demanding from the technology before it gives its support.

Rather than seeking unspecified cost reductions, the report says the government should kick-start CCUS by aiming to bring forward projects at least cost. The report also says that the government’s ambition to ‘deploy CCUS at scale during the 2030s’ is so broad as to be meaningless, recommending that the government provide clarity by adopting specific targets.

The government has set a target to commission the first CCUS facility by the mid-2020s. Five clusters – Teesside, Humberside, Merseyside, South Wales, North East Scotland – have been identified as well suited to early CCUS deployment. The report recommends this ambition is raised to target the development of first CCUS projects in at least three clusters by 2025.

The report also recommends that the government considers an alternative to running a third competition for funding and urgently consults on approaches to allocate funding for CCUS industry clusters.

The Committee also suggests that the government tasks the National Instructure Commission – or a third party – to conduct a cost benefit analysis of the potential role of CCUS to decarbonise industrial emissions. The results of this assessment should then be taken into account during decision-making on spending for national infrastructure. 

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