Source · Select Committees · Public Accounts Committee
Recommendation 11
11
Accepted
Government's ambitious CCUS strategy remains untested at scale despite significant investment
Conclusion
At the 2023 Spring Budget, the Chancellor announced £20 billion for carbon capture, usage and storage (commonly referred to as CCUS).32 However, while providing a signal to the sector and investors, this technology is untested at scale in the UK. The Department acknowledges that its current ambition for CCUS to capture 30 megatons by 2030 is hugely ambitious; however, it considers that its current plan is more ‘holistic’ than previous attempts. By this it means that different carbon emitting sources, carbon capture projects, and transport and storage infrastructure are clustered, and that this will make an important difference compared to previous attempts that were focused around one type of power-based carbon emitter, with expectations that industrial emitters would follow later.33 We received written evidence from The Carbon Capture and Storage Association that indicated a number of key policy decisions and legislation still required in this parliament for government to achieve its CCUS deployment ambitions.34 This Committee has seen how previous government attempts to get CCS (carbon capture and storage) off the ground have repeatedly failed, and in 2017 we reported that ‘Halting CCS’s deployment means that the UK will have to pay billions of pounds more to meet its decarbonisation targets, has missed opportunities to be at the forefront of a growing global industry, and has damaged investors’ confidence in working with the government on CCS in the future.’35
Government Response Summary
The government accepts the committee's observation, stating a target implementation date of December 2023, and details its efforts to provide clarity and encourage investment through recent publications, £20 billion funding for CCUS, and plans to publish further sector-specific roadmaps later in 2023.
Government Response
Accepted
HM Government
Accepted
3.1 The government agrees with the Committee’s recommendation. Target implementation date: December 2023 3.2 The department recognises the importance of giving clarity to the private sector to encourage investment. Earlier this year the government published Mobilising Green Investment: the 2023 Green Finance Strategy, alongside the Powering Up Britain: the Net Zero Growth Plan and Powering up Britain: the Energy Security Plan. 3.3 The Green Finance Strategy provides clarity on pathways for investment across net zero, and communicates to businesses, investors and the finance sector the UK’s plan to grow investment. These publications set out plans to grow green investment across all parts of the UK, which include providing up to £20 billion funding for early deployment of Carbon Capture, Usage and Storage, and launching the fifth Contracts for Difference allocation round, the first round to run on an annual basis. These provide investor clarity on the government’s overall approach to enhance our country’s energy security, seize the economic opportunities of the transition, and deliver on our net zero commitments. 3.4 In addition, the department is also communicating more detailed investment needs and opportunities on a sector-by-sector basis. In March 2023 it published the Offshore Wind Net Zero Investment Roadmap, the Heat Pump Net Zero Investment Roadmap, and the Hydrogen Net Zero Investment Roadmap, as well as an updated version of the Carbon Capture Usage and Storage Investment Roadmap. The department considers that this is an appropriate way to provide detail relevant to particular groups of investors and plans to publish further roadmaps for other sectors that need private sector investment later in 2023.