UK carbon capture strategy ‘outdated and unrealistic’ as costs doubled to £20bn
The UK Government’s energy policy centred around carbon capture, usage and storage (CCUS) is outdated and unrealistic, a new report has warned.
Think tank Carbon Tracker has today said that cost estimates for deploying CCUS have more than doubled from the £20bn in taxpayer funding initially scoped in December last year.
This strategy was based on the recommendations of the Climate Change Committee, published in the sixth carbon budget in December 2020.
The report also claims that the government’s plan to capture around 20-30m tonnes of carbon dioxide per year has now slimmed by around one-third due to the growth of renewables, battery storage and flexible technologies.
The think tank also warned that the UK is targeting applications where CCUS could lock consumers into what it describes as a “high-cost and fossil-based future”, despite the existence of cleaner and cheaper alternatives.
It argued that plans to use CCUS to de-carbonise steel production and gas-fired power plants should be abandoned, with both applications likely to be out-competed by cleaner alternatives as has been seen by Tata Steel’s abandonment of plans for CCUS at its Port Talbot site in favour of a move towards a cleaner steel production system.
Where CCUS is truly facing its toughest test however is with biomass generation and specifically, the incredibly costly, incredibly polluting wood-burning biomass plant run by Drax in North Yorkshire.
The Drax conversion is likely to require a complex subsidy scheme together with a government-provided bridging mechanism that could lock taxpayers’ money into a long (15-25 years) and costly (£26-43bn) contract.
Furthermore, Carbon Tracker contends that the resulting electricity would be up to three times more expensive for consumers than offshore wind power.
The issue over the potential expense of the Drax project has surfaced before.
When the firm received the government greenlight on the undertaking, energy think tank Ember said the project would be in the region of £43bn from taxpayers, while Drax’s own analysis claimed it would end up saving citizens around £700m annually, or £15bn between 2030-50.
Carbon Tracker associate analyst and report author Lorenzo Sani said: “Carbon capture and storage technology has proven to be much more complex and expensive than thought, while renewables cost reductions have dramatically changed the landscape.
“While the government is playing an important role in de-risking new projects it urgently needs to revisit its targets and focus its resources on high-value applications such as cement and hydrogen.”
The report comes the day after the government unveiled plans for gas-fired power stations to serve as power back-up to the UK’s renewable energy infrastructure, with the potential for private investors to buy in on either upgrading existing power station stock or build new ones.
Sani added that carbon capture and storage should not be considered for bolt-ons to gas-fired stations as the investment would likely be twice that of hydrogen turbines.
“It’s no surprise that we need some form of flexible power generation for when “the sun is not shining and the wind is not blowing”, however, this should not be used as an excuse to build a large fleet of new gas-fired power plants at any cost to taxpayers,” he said.
Drax and the Department of Energy, Security and Net Zero have been contacted for comment.