Three months to back clean coal plant in hunt for £250m grant

Officials at the European Commission have told MEPs that any project seeking support from their carbon capture and storage (CCS) funding competition must have been given the green light by their national governments by the end of April.

The White Rose power project at Drax in North Yorkshire is the sole entrant in the entire Europe-wide competition – but will still miss out on the £250m available if it does not secure match-funding from the UK government. If approved, the new 425MW power station at Drax’s existing site near Selby would be the first power station in the country to bury its carbon emissions underground.

The Government has shortlisted the project for its own, much-delayed £1bn CCS funding competition, but is insisting on undertaking another 18-month engineering study before it gives the scheme the final go-ahead.

But a pledge of support for the White Rose scheme will be required within three months if the EU grant is not to be lost. A motion passed in the EU Parliament last month warned it was “far from certain” Drax would secure the funds.

Speaking to the Yorkshire Post, Liberal Democrat MEP Chris Davies, who leads on CCS at the European Parliament, said the Government has “nothing to lose” by giving its formal backing to the Drax project now as even if it backs out later, the assurance would not be legally binding.

“The Government has got £250m to gain and absolutely nothing to lose from expressing its firm backing for the White Rose project,” the North West MEP said. “The EU rules say that this is needed if the money is to be allocated, but it is not legally binding and the UK could back out at any time if unexpected difficulties are encountered.

“The only risk for Ministers is loss of face.”

Energy Minister Michael Fallon is likely to answer questions about the issue when he appears before the Commons energy committee to discuss the Government’s CCS strategy this morning. His department has already made clear it is aware of the EU’s competition timetable, and insists it has supported the White Rose project throughout.

A spokesman for the Department for Energy and Climate Change said: “The Government has supported the White Rose project throughout the application process, and the commission’s subsequent due diligence process. The Government has shown a strong commitment to the project with the recent signing of a multi-million pound front-end engineering and design study contract.”

CCS is a new technology which involves siphoning off harmful CO2 emissions before they are released from chimney flues and burying them safely underground.

Yorkshire is seen as the ideal place to trial the technology due to its cluster of heavily-polluting power stations and industrial sites, and its close proximity to depleted North Sea oil and gas fields where scientists believe millions of tons of CO2 could be stored.

Drax’s project would see a large underground pipeline carry CO2 from its site at Selby right across Yorkshire and out into the North Sea. Regional planners want it to become the first part of a much wider CCS pipeline network that could incorporate all the region’s heavy polluters – so slashing carbon emissions on a huge scale while securing the future of Yorkshire’s heavy industries for decades to come.

The potential importance of the CCS industry to the UK as a whole is re-emphasised today with a new report which concludes investing in CCS would ultimately save nearly £100 from people’s energy bills, while also creating thousands of jobs and protecting key industries for the long term.

The study, funded by industry body the Carbon Capture and Storage Association and the TUC, claims investing in CCS now will ultimately prove a cheaper option than other renewable energy sources for consumers and taxpayers alike.