AS the Carbon Capture bandwagon accelerates in the UK there remain concerns that ministers are putting lots of faith in an untested technology as part of a drive that could generate a bonanza for corporations accused of fuelling climate change.

The North Sea Transition Authority announced on Thursday the winners of the UK’s first ever carbon storage licensing round. This was designed to clear the way to firms using depleted oil and gas reservoirs to store carbon that would otherwise be released into the atmosphere.

The winners include the Spirit Energy business controlled by giant utility Centrica and North Sea oil and gas heavyweight EnQuest.

Some 20 licences were awarded following a round that attracted 26 bids and which the regulator said would allow the net zero drive to take a significant step forward.

The expectation is that North Sea reservoirs will be linked to a network that will allow carbon from industrial sites across the UK to be transported offshore for storage. Reservoirs could also be used to store carbon removed from natural gas in the production of hydrogen, which supporters hope will fuel a green future, and from a planned gas-fired power plant at Peterhead.

NSTA chief executive Stuart Payne said the awards announcement was exciting and important.

“As a nation, we cannot meet our decarbonisation targets without carbon storage. This is net zero delivery in action,” he said, adding: “The awards we offer today could store around 10% of the UK’s emissions.”

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Mr Payne said in some cases first injection could come in as little as six years. 

The announcement underlined the importance the UK Government has attached to the Carbon Capture Storage and Usage (CCUS) agenda as it aims for the country to achieve net zero in terms of emissions by 2050.

The NSTA noted: “The offers come in the wake of the Chancellor’s Budget announcement that the Government is allocating up to £20 billion in support of developing carbon capture, usage and storage.”

It added: “This first carbon storage licensing round is likely to be the first of many as up to 100 CO2 stores could be needed for the UK to meet the net zero by 2050 target.”

Lord Callanan, Minister for Energy Efficiency and Green Finance, said the government’s unprecedented £20bn investment put the UK in prime position to take advantage of the geological goldmine beneath its shores to store CO2, and grow its economy by becoming world-leaders in a developing industry.  

The announcement came soon after another milestone was passed in the CCUS development process.

April 28 was the deadline for applications from areas that want to win support under the second track of the clustering process developed by the UK Government.

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The Government has said it will establish CCUS in two industrial clusters by the mid 2020s, and aim for four by 2030.

Clusters covering coastal areas of northern England and Wales were awarded Track 1 status in October 2021 in a decision that sparked outrage in Scotland. Its cluster was awarded Track 1 reserve status. 

Champions of carbon capture reckon the fact Scotland has many depleted reservoirs offshore and is crossed by a network of pipelines make it the ideal setting for a cluster. 

It is claimed the expertise offered by the North Sea oil and gas industry could be harnessed to speed the development of a CCUS sector that could win work business from overseas.

Current plans centre on the Acorn project, which will involve shipping emissions via St Fergus for storage 1.5 miles beneath the North Sea.

After Boris Johnson sparked fury with the 2021 decision to rank other clusters ahead of Scotland's critics accused his successor Rihsi Sunak of rubbing salt into the wounds be allowing the country to be snubbed in the March Budget.

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Stephen Flynn, Aberdeen South MP and SNP leader at Westminster, said it was utterly shameful that the Tory Government had shafted Scotland again by failing to announce any funding for the Acorn project and Scottish carbon capture in the Budget.

In the energy strategy it published in January following long delays the SNP Goverment said CCUS would be essential for capturing emissions in Scotland's energy system.

It added: "The Scottish Government remains supportive of these technologies as part of the energy transition and in particular it remains committed to supporting the delivery of the Scottish Cluster."

But carbon capture is a bit of an awkward subject for a Scottish Government that is relying on the support of greens as it tries to maintain the independence drive amid the financial crisis engulfing the SNP.

While the treatment of the Scottish Cluster provides a great opportunity for independence supporters to claim Scotland is being failed by Westminster, some greens at least remain bitterly opposed to the broader carbon capture initiative. They fear CCUS will be used to prolong gas production and avoid taking the action needed to cut emissions fast enough.

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In the wake of the Budget in March, Friends of the Earth Scotland said new First Minister Humza Yousaf and his cabinet must realise that carbon capture was a dangerous distraction from the urgent and necessary work of cutting emissions at source and delivering a just transition from fossil fuels.

The organisation declared: "The UK Government should not continue to throw billions of public money at the fossil fuel industry, prolonging its climate-wrecking activities through the carbon capture fantasies at Acorn or anywhere else. Politicians must stop subsidising some of the most profitable producers on the planet." 

Such comments will be dismissed as standard anti-business rhetoric by those who think we must harness the knowhow of the private sector to deliver net zero.

However, carbon capture has not been deployed on the scale envisaged in the UK's cluster programme anywhere in the world.

It looks like big wealthy corporations could be among the biggest winners of the CCUS drive.

The Government is developing the business models that will be required to underpin a new carbon capture industry. While the details have yet to be finalised, it appears these could involve the provision of big subsidies to market participants.

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In the summary of the business model for an industrial carbon cluster published in December the Government said it expects this will feature capital grants for infrastructure work “and/or ongoing revenue support”.

Some fear this may mean that taxpayers bankroll projects which will ultimately generate strong returns for firms that have made massive profits in the North Sea oil and gas business following the surge in prices fuelled by Russia’s war on Ukraine.

“The Acorn project appears to be totally reliant on further public subsidy to progress,” complained Friends of the Earth Scotland in March. It highlighted the fact that partners in Acorn include Shell and Harbour Energy, which have posted bumper profits in recent months.

Investors in the firm leading work on the Scottish Cluster, Storrega, include Australian banking heavyweight Macquarie and Japanese industrial giant Mitsui.