2CO misses out but Drax successful in carbon capture competition
POWER generator Drax is set for a major windfall after being shortlisted to receive a share of £1bn of funding to support the commercialisation of carbon capture and storage technology.
However, 2CO Energy’s Don Valley Power project, a favourite to win a slice of the cash, has missed out on the UK shortlist and will not now go through for the opportunity to win European funding.
Drax’s bid is one of four CCS projects that were today shortlisted by the Government.
Capture Power, a joint venture from Drax, Alstom and BOC has put forward the ‘White Rose CCS Project’, a new plant on the Drax site burning coal and biomass, for a share of the £1bn pot.
The White Rose CCS project would see a new plant at Drax generating enough power for 630,000 homes with 90% of all the CO2 produced stored under the North Sea.
In a separate bid, 2Co Energy was looking for the Government to support its plans for the Don Valley Power Project, a new coal-fired power station in South Yorkshire.
The Government launched the competition for funding designed to encourage the development of CCS technology following the collapse of a scheme focused on the Longannet power station in Scotland last year.
The European Union is offering grants of around £240m to a number of schemes across Europe, but is demanding match-funding from national governments.
The successful projects, which also include a proposal on Teesside, will now be invited to take part in negotiations with Government before decisions on which projects to support further are taken in the new year.
Three of the UK’s shortlisted bids – including the Drax scheme – also applied for European Commission funding from what is known as New Entrant Reserve (NER) allowances.
The Government today said it had written to the Commission to inform them that it is willing to support all three, subject to their success in the UK competition.
Secretary of State for Energy and Climate Change, Edward Davey, said: “We have received some quality bids from industry who have really risen to the challenge set by the competition.
“The projects we have chosen to take forward have all shown that they have the potential to kick-start the creation of a new CCS industry in the UK, but further discussions are needed to ensure we deliver value-for-money for taxpayers.
“Today’s announcement is an important step towards an exciting new industry, one that could help us reduce our carbon emissions and create thousands of jobs.
“We have one of the best offers in the world and are a leading country in Europe. We will remain in close contact with the European Commission in the coming months as they take their decisions on which projects to support with European funding.”
The other two successul bids are in Scotland.
