CCS could cut cost of UK’s carbon targets by 1% of GDP, says report

Posted at November 27, 2012 » By : » Categories : News » Comments Off on CCS could cut cost of UK’s carbon targets by 1% of GDP, says report

If the public and private sector can overcome the financing challenges of rolling out carbon capture and storage (CCS), the prize could be huge, according to a new report.

The study, Carbon Capture and Storage – Mobilising private sector finance for CCS in the UK, from the Energy Technologies Institute (ETI) and the Ecofin Research Foundation concludes that successful use of the technology could save the UK up to 1% of GDP by 2050 on the annual cost of meeting its carbon targets.

The key priorities to securing funding, says the report, are creating a “compelling vision” of the development of CCS, making early CCS projects investable, and exploring public-private partnerships and co-ordination mechanisms.

Crucially, the report calls on the government to consider giving the Green Investment Bank a role in facilitating access to capital for CCS projects.

“CCS will involve a complex new value chain and new business structures which are unproven at scale,” says Angela Whelan, chief executive of Ecofin. “Financial markets are challenging and the CCS value chain will need to be derisked and be more competitive to gain access to private sector capital.”

But the rewards for getting it right could be significant, says co-author of the report, George Day of the ETI.

“As well as being a technological opportunity for the UK, CCS is an economic opportunity,” he says. But he warns that CCS is “very policy dependent”.

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Related stories:
Carbon capture and storage can compete on costs, says report (21-Nov)
Government makes £20 million CCS award to keep UK at forefront (21-Nov)
Uncertainty over EU funding for UK carbon capture projects (13-Nov)
2Co Energy drops Don Valley CCS project after failing to secure support (1-Nov)

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