Source · Select Committees · Public Accounts Committee
Recommendation 7
7
Department and Treasury agree CCUS funding limits but recognise substantial contingent liabilities
Conclusion
A major factor in the failure of the second CCUS competition was the lack of agreement between the Department and HM Treasury on funding limits.15 The Department told us that this time it had agreed an affordability envelope with HM Treasury which has developed as the projects have matured.16 HM Treasury announced up to £20.0 billion of funding in March 2023 for the early deployment of CCUS17 and made a further announcement in October 2024, increasing the funding to £21.7 billion over 25 years and specifying that this was to cover the first five projects.18 In November 2024, the Department recognised contingent liabilities with a maximum value of £34.4 billion and a ‘reasonable worst–case’ value of £14.3 billion. These potential liabilities cover the risks the Department is underwriting for the CCUS programme.19
Government Response
A response document is linked to this report, dated 6 May 2025. Response attribution to this conclusion has not been verified. Read the response document ↗