'Lose confidence': expert's warning on Humber carbon capture April deadline
There are fears that investors will “start to lose confidence” in the Humber carbon capture project if the Government fails to hit the latest funding deadline, an industry expert has said.
Mark Sommerfield, the Carbon Capture and Storage Association’s UK Director, said this year is “critical” to the success of the Viking scheme in Immingham.
In the June Spending Review, Chancellor Rachel Reeves pledged to back CCS in the Humber, which would see carbon dioxide emissions taken from Immingham 34 miles to Theddlethorpe in the Lincolnshire coast, where they would be transported into huge tanks beneath the North Sea.
The fledgling technology is touted as an alternative to releasing carbon into the atmosphere, with Energy Secretary Ed Miliband saying it is essential to the UK reaching net zero by 2050.
Businesses say they have £15bn ready to invest in the Humber if the Government provides adequate support to get CCS off the ground.
The next deadline is April, when the Government should approve development expenditure (DEVEX) funding.
Mr Sommerfield told The Yorkshire Post: “As far as we hear from both projects and from the Government, they are in line to make sure that allocation is put in place.
“But we certainly are wanting to ensure that does happen, and concerns about that not happening come from the wider political atmosphere around Net Zero, and wider fiscal constraints that are affecting the whole economy.
“As far as we're aware, they are on course to reach an agreement and see the allocation funding put forward.”
The site is being run by Harbour Energy and has its two anchor emitters ready - VPI, the company behind electricity and steam generation for the Humber’s two large oil refineries, and Phillips 66, one of the crude oil refineries.
The “Energy Estuary” generates 20 per cent of the UK’s total electricity, creates one-third of its refinery products and is the location for the importation of around one-fifth of all gas into the country. It is also the largest emitter of carbon dioxide in Britain.
Mr Sommerfield explained that it is essential to hit the April deadline and avoid deindustrialisation in the Humber.
“There is momentum behind the sector, but that momentum absolutely needs to be continued in 2026 if we're going to realize the full potential of CCS in the UK,” he said.
“That includes seeing Viking taken forward and the industrial benefits that that provides.
“Investors have had a long time now of spending on DEVEX, spending on feed reports, getting the projects into a point of presentation for government.
“They are being told that the decision is around the corner, and we're now at the stage that if those decisions don't come, then yes, we think investors will start to lose confidence in the market.”
The aim for Viking is to reach a final investment decision before the end of the Parliament.
The Yorkshire Post recently asked Mr Miliband for an update on the project, and he said: “It's a really important cluster.
“That's why, at the Spending Review, we put in important development spending to take it forward.
“We're really committed to that project. There's no route to decarbonise our country, or indeed the world, without CCS.
“And again, it goes to this point about how do we create the good jobs of the future?”