UK Green Recovery Plan Boosts CCS (Update)
(Adds comments at end)
UK prime minister Boris Johnson has repeated plans to fund carbon capture and storage (CCS), hydrogen, nuclear power, electric vehicles and renewable energy in a strategy to create jobs and reduce carbon. They have been broadly welcomed by industries looking forward to financing, but a long-awaited government policy paper is also needed, says Cornwall Insights.
The late November 17 £12 ($16)bn ten-point plan is expected to create a quarter of a million job and to mobilise three times as much private sector investment in support of the UK's 2050 net zero goal. Out of the total, only £4bn is new, according to the BBC. But it includes £200mn on top of the previously promised £800mn for CCS. The UK in 2015 under another Conservative government cancelled a £1bn CCS support scheme so this is the second attempt.
Johnson said: "Although this year has taken a very different path from the one we expected, I haven't lost sight of our ambitious plans to level up across the country. My Ten Point Plan will create, support and protect hundreds of thousands of green jobs, whilst making strides towards net zero by 2050.
"Our green industrial revolution will be powered by the wind turbines of Scotland and the northeast, propelled by the electric vehicles made in the Midlands and advanced by the latest technologies developed in Wales, so we can look ahead to a more prosperous, greener future," he added.
There is so far no clarity on which CCS projects will receive funding, but Storegga, which is working on one in Scotland called Acorn, is hopeful. It told NGW: “Acorn has entered front-end engineering design and is presently the most advanced of the UK’s CCS projects, with first C02 storage operation planned in 2024. It is also the most scalable and is cost competitive.”
CEO Nick Cooper said: "The ability to capture and store significant volumes of CO2 under the North Sea in carbon capture and storage projects such as Acorn will be a crucial part of the UK’s journey to reaching net zero by 2050."
Upstream group Oil & Gas UK CEO Deirdre Michie said: “The good news for jobs and the economy is that with the right support, companies based here in the UK have the expertise to make us world leaders in tackling emissions, including through carbon capture and hydrogen production, both of which are key to the clean energy system of the future.”
Other contributors to the net-zero carbon future by 2050, which was originally promised by the previous government under Theresa May, include hydrogen networks and domestic heat pumps. But these are some way off, according to digital engineering consultancy Expleo.
“When incorporating a new gas into our system we need to be able to monitor and track its performance. This will require an "internet of pipes" if you will,” it said. “Despite the virtues of hydrogen, the grid is going to need to undergo an immensely complicated digital upgrade before we're ready to reap its benefits.”
Cornwall Insight said the plans to make the City of London the global centre for green finance through sovereign bond, carbon offset markets and disclosure requirements, could be very significant in delivering required capital. The long-awaited Energy White Paper will be the next landing stage for a coherent strategy for the energy sector for the decades ahead."
Global CCS Institute said CCS hubs and clusters across the UK is a significant step forward in mitigating emissions from the UK’s most energy intensive industrial sectors. “The announcement shows leadership in the UK around CCS, an absolutely key climate technology”, said international adviser to the Global CCS Institute and renowned economist at the London School of Economics, Nicholas Stern.
Wood Mackenzie said: “Several industrial CCUS hubs are already in development, and the UK is well-placed to repurpose its depleted North Sea fields to store carbon. Methane-derived hydrogen is already widely used in the petrochemicals and refining sectors. Displacing those emissions with low-carbon hydrogen is an obvious first step, but the potential use cases are much more diverse, ranging from iron and steel production to heavy duty transportation.”
An unambiguous thumbs down came from the privately-funded Global Warming Policy Foundation, long an opponent of counter-productive subsidies that go to importing technology from overseas.
It calculates that UK electricity bills will have to include £27bn/yr, roughly double the wholesale market value of the entire UK electricity sector at present.
These high prices will “render utterly unaffordable the prime minister’s proposals for heat pumps and electric vehicles. This will cause anger.”
Heat pumps cost between £10,000 and £20,000 each to install, so the prime minister’s aim of installing 600,000/yr by 2028 implies an annual cost of between £60bn and £100bn/year, it said, questioning the wisdom of Johnson’s advisers.