Select committee: Public Accounts Committee
Recommendation 21
8th Report - Carbon Capture, Usage and Storage
Published 7 Feb 2025
Addressed to HM Treasury
Public Accounts Committee Carbon Capture, Usage and Storage All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗
Recommendation (the committee's words)
The Department recognised that there are some “contested views” concerning, for example, the effectiveness of CCUS in reducing emissions from gas–fired power stations.69 We received written evidence suggesting that there are higher levels of methane (a gas with significant greenhouse effects) leakage throughout the supply chain for liquified natural gas (LNG) than previously thought. Given that the UK’s LNG production is winding down, more LNG is likely to be imported from countries like the USA, lengthening the supply chain and worsening the risk of leakage. Methane leakage during production and transportation of LNG are ‘upstream emissions’ that will not be addressed by CCUS and might have a greater climate impact than the actual burning of the gas at a power station.70 The Department told us that there are contested views in this space and 63 Contracts signed for UK’s first carbon capture projects in Teesside – GOV.UK 64 Letter from Minister of State for Industry dated 11 December 2024; and Letter from DESNZ to PAC dated 21 January 2025. 65 Q 7 66 Q 24 67 Q 25 68 Q 27 69 Q 4 70 CCUS0018 16 that issues such as methane leakage will need to be looked at through the broader perspective of Carbon Budgets, rather than through the CCUS programme.71
From: Public Accounts Committee, 8th Report - Carbon Capture, Usage and Storage (HC 351), 7 February 2025
Government response
Latest Treasury Minutes progress report to the Committee of Public Accounts on the Eighth Report of Session 2024-26
The government responded to the whole report on 4 June 2026.
Treasury minutes: Government response to the Committee of Public Accounts on the Eighth report from Session 2024-25
Published 6 May 2025.
Summary written by Accountability Index from the government's response. It is not the government's own words.The government states that it agrees with the Committee's recommendations across the areas covered, while saying that for annual reappraisal of value for money its process is "ongoing, dictated by the project pipeline, rather than a fixed annual schedule".
- On annual reappraisal of value for money, the government says it agrees with the recommendation but reviews the approach "primarily" via the Business Case process, ahead of final investment decisions, and not on a fixed annual schedule.
- The government acknowledges that the 2030 ambition of capturing and storing 20-30 million tonnes of CO2 per year "is no longer achievable", and will publish a report setting out its plan to meet carbon budgets, with a target implementation date of Spring 2025.
- On BECCS, biomass sustainability criteria "will be developed" for any future support, and the department "plans to consult later this year" on a common biomass sustainability framework. Target implementation date: Summer 2025.
- On sharing financial benefits, the government notes the business models already have mechanisms, such as a "gainshare" mechanism in the Net Zero Teesside agreement, and will "continue to evolve" them. Target implementation date: December 2026.