‘Clean power’ schemes battle for Euro cash

The Department of Energy and Climate Change (DECC) yesterday said carbon capture and storage (CCS) power plants planned for Selby, Hatfield and Killingholme will compete for about 4.5bn euros (£3.9bn) of European Union cash. Up to three of the 12 projects will eventually be selected for the New Entrant Reserve 300 (NER) funding.

DECC wants to clean up the UK’s power supply, reducing its reliance on dirty coal-fired power plants.

Energy Minister Charles Hendry said: “I am very encouraged by the strength and breadth of the UK applications for this round of NER funding, with all the projects received by DECC meeting the eligibility criteria.

“They demonstrate that the UK is at the cutting edge of low carbon energy development, ranging from CCS to wave, tidal and offshore wind. Taking forward these sorts of technologies will be crucial to our move to a low carbon economy, providing green jobs as well as helping us lower emissions and increase energy security.”

The Yorkshire and Humber region has the biggest concentration of single source carbon emitters in the UK, with sites including Drax power station, Corus steel works and Lindsey oil refinery spewing out at a combined 60m tonnes of CO2 per year.

CCS, an unproven and controversial technology, involves capturing carbon emissions at source and pumping them deep underground. The saline aquifers and depleted oil and gas fields of the North Sea are seen as an ideal place to store them.

Private equity-backed 2Co Energy announced on Monday it had bought Powerfuel Power from administrators KPMG, just in time for DECC’s deadline and reviving plans for a 900 megawatt (MW) clean coal power station next to Hatfield colliery.

The company will work with National Grid on the £3bn project, and aims to pump the CO2 into depleted oil fields off the east coast of Scotland, via a 250-mile pipeline. It hopes to use the CO2 to flush out previously inaccessible oil.

Powerfuel had also planned a 450MW clean gas CCS scheme at Hatfield, but 2Co said it is only pursuing the 900MW plant. “We are delighted, it endorses our decision to acquire Powerfuel Power,” said 2Co chief executive Lewis Gillies yesterday.

The other CCS projects from the region were submitted by Drax, which wants to build a 426MW CCS demonstration alongside its Selby coal-fired plant, and Belgian firm C.GEN, which is planning a 430MW clean gas CCS plant next to the Humber Sea Terminal in North Lincolnshire.

Drax, which is working with French engineering giant Alstom on the standalone plant, yesterday also welcomed DECC’s announcement.

Joanne Pollard, chief executive of not-for-profit environmental consultancy CO2Sense, claimed the Yorkshire is becoming the “hub of growth” in the alternative energy sector.

DECC submitted seven CCS schemes and five renewable energy projects. The European Investment Bank now spend nine months doing due diligence on the applications. After this the European Commission will weigh up the projects before deciding which will get the funds. The Government said it will also invest taxpayers’ funds in four CCS projects.

Meanwhile, Cornish pasties are to be used to power cars after a green fuel firm announced plans to use them to make biodiesel. Greenergy is extracting oil from pasties, pies, crisps and other food waste before blending it with diesel and selling it at petrol stations. The company is investing £50m in its production facility in Immingham in Lincolnshire.