UK government needs clear strategy to deploy CCUS

A CROSS-PARTY report from the Business, Energy and Industrial Strategy (BEIS) Committee has criticised the government for its vague and ambiguous policies relating to carbon capture usage and storage (CCUS) and said that the government needs to outline a clear strategy.

The report says that CCUS has suffered from 15 years of turbulent policy support. The title, Carbon Capture Usage and Storage: third time lucky?, refers to the government’s two previous failed attempts at CCUS demonstration competitions, which were cancelled in 2011 and 2015. The government’s current CCUS objectives were set out in 2017 in its Clean Growth Strategy and further detail was given in its Action Plan, which was released in November 2018.

The plan says that “the UK should have the option to deploy CCUS at scale during the 2030s, subject to the costs coming down sufficiently.” The BEIS committee report expresses concern on the meanings of “at scale” and “sufficient”, particularly for industries where there are no alternative carbon-removal solutions against which costs can be compared. In these cases, the focus should be on projects that have the least cost. Concerns were also raised that if deployment of CCUS takes too long, parent companies could move business to other countries with more active decarbonisation strategies.

The report recommends bringing forward the projects that have the lowest cost rather than seeking unspecified cost reductions. It also says that the government’s ambition to roll out CCUS at scale during the 2030s is “so broad as to be meaningless”, instead saying that the government should adopt specific targets.

The government should also urgently consult on the most appropriate approaches to allocate CCUS funding. It is currently planning on a third competition to select the first industrial project to deploy CCUS, but the report notes strong opposition to this as collaboration is deemed more important than competition. The previous competitions undermined the existing strong culture of collaboration of the UK CCUS community, leading to limiting of knowledge-sharing and therefore slowing progress on CCUS developments.

Stuart Haszeldine, Professor of CCS at the University of Edinburgh and Director of Scottish Carbon Capture & Storage (SCCS), said: “There are five potential CCUS clusters of high-emitting industries, which want to reduce their emissions by capturing and permanently storing the CO₂ they emit. Each cluster has different and complementary strengths, and the UK Government needs to support them to collaborate, not pit them against each other in a competitive arena. We could be well on our way to decarbonising the whole economy in 2023, if the UK Government takes the Committee’s recommendations on board.”

Financial and environmental impact

The Committee on Climate Change is due to release a report next week on whether the government should set a net-zero carbon target and when to implement it. The current legally-binding target through the Climate Change Act 2008 is to reduce emissions by 80% from 1990 levels by 2050. Campaigners have said that to limit warming to 1.5^oC, these targets need to be net zero. As it is, the UK is currently not on track to meet its legally-binding carbon targets, according to a separate report released by government earlier this month.

The BEIS committee report notes the financial impact of not adopting CCUS, saying that the cost of meeting the targets of the Climate Change Act 2008 would rise from 1% to 2% of GDP per annum by 2050. CCUS is traditionally seen as an add-on for power stations, but the report urges the government to see its value in decarbonising a wide range of industries, as well as its role in producing clean hydrogen from natural gas.

The latest National Infrastructure Assessment cost benefit analysis focuses on the role of CCUS in decarbonising power and heating. The report says that the omission of the benefits of industrial CCUS was a major oversight, and recommends that a new analysis that includes this needs to be performed and taken into account for future spending on national infrastructure.

It also recommends that the forthcoming Comprehensive Spending Review should consider the financial benefits of CCUS and not just the implementation costs. CCUS will extend the lifetime of heavy industry that would otherwise have to shut down.

The government’s Action Plan aimed to establish one CCUS cluster by the mid-2020s, in contrast to a recommendation by the CCUS Cost Challenge Taskforce in July 2018 that there should be two. The BEIS committee report says that there should be at least three clusters established by 2025 to ensure that there won’t be a significant delay if one project runs into difficulties.

Anna Turley, Labour MP for Redcar and Member of the Business, Energy and Industrial Strategy Committee, said: “CCUS is crucial to meeting the UK’s climate change targets and will be vital to achieving a ‘net zero’ target. But Government support is needed to make CCUS a reality. The Treasury needs to shake off the blinkers in its attitude to CCUS, take a more nuanced approach to the costs but also recognise the benefits. CCUS is the best and most cost-effective way to reduce our carbon emissions. Without CCUS many of our heavy industries could face closure.”

“We strongly welcome the Committee’s report, and urge the Government to act on its recommendations,” said Haszeldine. “We could be well on our way to decarbonising the whole economy in 2023, if the UK Government takes the Committee’s recommendations on board.”