Recommendation 12

We asked the Department whether its business models allow for the government to take a share of any profit a project makes if the programme is successful.37 But the Department could not provide a compelling answer.38 Now that the Department has signed its first two contracts for carbon capture and storage, this will produce an “incredibly better investment” scenario for the private sector in the second tranche, which should encourage the Department to think about, for example, profit shares and equity stakes.39 HM Treasury hopes that the government agreeing support for projects in the programme’s Track 1 will provide industry with confidence over the government’s long term commitment to CCUS.40 The Department told us that it would be “looking very carefully at the economics of the developers and the investors, including what benefit they accrue from the projects…”.41 The Department assured us “that [was] exactly the sort of thing [it] is considering in an open–minded way.” 42 Assessing the programme’s affordability