£100m wasted on Yorkshire's '˜clean coal' bid

The National Audit Office found the Government’s attempt to kickstart carbon capture and storage in the UK was “ambitious, but ultimately, unsuccessful”.

The Government launched a competition in 2012 offering £1bn to companies which could put forward credible plans to use carbon capture and storage technology.

A plan known as the White Rose Project based around the Drax site emerged as one of the leading contenders before the competition was abruptly scrapped by George Osborne in 2015.

It had been hoped White Rose could create 3,500 jobs in Yorkshire and put the region at the forefront of CCS technology.

The NAO’s report, published today, reveals the Department for Business, Energy and Industrial Strategy spent £100m on the scrapped competition having already spent £68m on an earlier CCS programme which was cancelled in 2011.

It found the department had not agreed with the Treasury how much financial support projects would receive before it launched the competition, a failure which ultimately led to Mr Osborne’s decision.

Meg Hillier, chairman of the Public Accounts Committee of MPs which scrutinises Government spending, said: “This hugely ambitious and expensive government programme has faced a number of problems, but was on the verge of an important milestone when it was slashed.”

Ms Hillier said the taxpayer had lost out both financially and through the failure to develop technology which could help combat climate change.

She added: “Taxpayers will be alarmed that disagreement between departments means the taxpayers have little to show for the £100m the Government spent on the competition. The Government will have to work hard to restore investor confidence in carbon capture and storage.”

The White Rose Project would have seen the building of a new coal-fired power station on the Drax site connected to a pipeline which would carry harmful gases to be stored under the North Sea.

But the project’s real significance would have been as an “anchor” making a broader pipeline network connecting heavy industry across the region financially viable. Experts say Yorkshire’s geography and history of power generation make it a prime area to pioneer the technology. The case for CCS has also been bolstered by moves to extract and burn gas previously considered inaccessible through fracking.

Yorkshire MEP Linda McAvan, who has backed efforts to launch CCS in the region, said: “The whole process has been hampered by political prevarication. Key projects in our region have been on hold for years, so now we need clarity on the Government’s intentions.”