Could this spell the end of the ‘stop-start approach’ to carbon capture in the UK?
'Mission Zero' – an independent review of net zero in the UK, undertaken by the Rt Hon Chris Skidmore MP on behalf of the UK government and published today highlights policy barriers that are delaying private sector investment in carbon capture utilisation and storage (CCUS).
It’s most definitely the case that the UK is uniquely placed to be a global leader in CCUS, which will play a critical role in the transition to net zero, as outlined in the report and we wholeheartedly support its recommendations that that the government ‘must act quickly to foster certainty and attract the investment that we need’.
It’s also true that the UK could squander its first-mover advantage if the government doesn’t act now. Carbon Clean, a global leader in carbon capture solutions that has been headquartered in the UK since 2012, is part of this advantage – giving the UK a strong position in the rapidly expanding CCUS sector.
The recent US Inflation Reduction Act and similar measures from Canada, are increasing the pressure on the UK to move quickly to take advantage of the opportunities presented by CCUS and our comparative advantage in the sector. As the report says: ‘If we do not accelerate in key areas, the cost of this inaction could be far greater than the cost of action’.
The report is right to call for the government to re-envisage and implement a clear CCUS roadmap, showing the plan beyond 2030 and taking a pragmatic approach to cluster selection – allowing the most advanced clusters to progress more quickly. It’s great also to see a broad approach recommended, that includes the need for ‘a strategy for the plan for non-pipeline transport and how dispersed sites and mini clusters can connect to the CCS network, and what support should be offered for doing so’. Something we have long advocated.
Large, costly and complex CCUS projects will only chip away at global emissions. Deploying fully modular, standardised carbon capture solutions across many industrial sites will deliver more – for climate mitigation and local economies. Providing support for dispersed sites and mini-clusters will help the UK benefit swiftly from this new era of carbon capture.
These recommendations come from the largest-ever engagement exercise on net zero in the UK and will no doubt be widely supported. But now it’s crucial that the government supports them. Mission Zero is very clear on the economic benefit of doing so: McKinsey estimates a global market opportunity of £1 trillion for British businesses by 2030 and the government estimates that the transition can support 480,000 jobs in 2030. It also emphasises the UK’s comparative advantage over other advanced economies in several key areas – including carbon capture and storage – and the opportunity to capitalise on export opportunities from the global transition.
In short, in order to remain competitive, the UK must quickly match the long-term funding certainty that the Inflation Reduction Act has brought in the US and we applaud the clear path outlined in this report. We hope and expect the UK government will now take this path and grasp the ‘historic opportunity’.