Source · Select Committees · Public Accounts Committee
Recommendation 10
10
Acknowledged
Department established specific business models for Track 1 CCUS projects to allocate risks effectively
Conclusion
The Department established business models on which to base its support for each of the projects in the programme’s Track 1.28 These models set out how costs and risks are distributed between the government and the project.29 The Department told us that it had separate business models for transport and storage, and then for different types of emitter, such as power.30 It told us that its approach enabled it to bring in investors which were suitable for different parts of the programme and to allocate risks more effectively.31 The Department also told us that the business models have been designed so a project is only paid once it is capturing carbon which is then stored. 32
Government Response Summary
The Department for Energy Security and Net Zero has created business models that provide the minimum subsidy required to support the projects, keeps the allocation of costs and risks under review with the aim of reducing subsidy over the long-term.
Government Response
Acknowledged
HM Government
Acknowledged
1.2 The Department for Energy Security and Net Zero (the department) has created business models that provide the minimum subsidy required to support the projects, in order to realise the anticipated benefits and positive value for money. The department keeps the allocation of costs and risks between government and projects under review, with the aim of reducing subsidy over the long-term.