Britain axes $2b carbon capture scheme

The cooling towers of the Drax coal-fired power station near Selby, northern England.
The cooling towers of the Drax coal-fired power station near Selby, northern England.PHOTO: AFP

LONDON (AFP) - Britain has quietly cancelled a competition to develop carbon capture and storage technology, reversing support for a tool intended to help combat global warming ahead of a climate summit in Paris next week.

The change was announced to the London Stock Exchange on Wednesday (Nov 25) as finance minister George Osborne revealed a much-awaited budget update to parliament that vowed to increase investment in energy research.

Proponents of CCS technology - which aims to capture emissions of carbon dioxide from power plants and prevent it entering the atmosphere and causing the planet to warm - reacted with dismay to the announcement that funding was no longer available for the £1 billion (S$2.12 billion) scheme.

"Moving the goalposts just at the time when a four-year competition is about to conclude is an appalling way to do business," said Luke Warren, chief executive of the Carbon Capture and Storage Association.

He warned that Britain would lose the opportunity to develop cost effective methods of reducing carbon emissions, calling the announcement "devastating", while industry group EEF said the decision would cost much more than it would save in the long term.

It comes days ahead of a major UN climate summit in Paris which aims to forge an international deal to stop global warming exceeding 2 deg C over pre-Industrial Revolution levels - a level scientists hope would avoid the most drastic effects of rising seas and extreme weather.

The government of Conservative Prime Minister David Cameron, who was re-elected for a second term in May on promises of balancing Britain's budget, has previously been criticised for cutting support for solar and wind energy.

Jim Watson, director of the UK Energy Research Centre, said the decision would make Britain's plan to cut carbon emissions by switching from coal to gas power plans less effective.

"Without CCS available, the Government's plans to use gas as a 'bridge' to a low carbon future will have much more limited mileage in the medium term," Watson said.

The carbon capture competition had two bidders: the White Rose project to capture 90 per cent of emissions from a coal power plant in Yorkshire in northern England and store it under the North Sea, and a scheme to capture carbon from gas power in Scotland.

Energy company SSE, operator of the Scottish power plant, called the decision a "missed opportunity" as their partner on the project, Royal Dutch Shell, said the decision meant the project would no longer go ahead.

"We have worked tirelessly over the last two years to progress our plans for this project," a spokesman for Shell said.

"Government funding to support this world-first demonstration project, through the competition, was important to achieving the aim of making the technology commercially viable in the shortest possible time."

A crunch UN summit on climate change with more than 150 heads of state and government opens in Paris on Monday in an attempt to negotiate a world pact on global warming.