UK scraps Longannet carbon project funding

LONDON,  (Reuters) – The British government cancelled  plans to fund a carbon capture and storage (CCS) demonstration  project at Longannet in Scotland, signalling the technology  remains too costly and undermining Britain’s ambition to become  a clean technology leader.

“A decision has been made not to proceed with Longannet but  to pursue other projects with the 1 billion pounds ($1.5  billion) funding made available by the government,” the  Department of Energy and Climate Change (DECC) said in a  statement yesterday.

CCS is still a commercially unproven technology but is  widely seen as a key mechanism to fight climate change by  trapping and burying greenhouse gas emissions, while maintaining  stable energy supply.

The government said it plans to use the money to fund other  CCS projects following the launch of a new bidding process in  England and Scotland.

Ministers will meet industry leaders in a forum on Nov. 2 to  discuss further steps, DECC said.

“At a time when North Sea revenues are coming in at record  levels, it was surely not too much to expect that the Treasury  would make the necessary funding commitment for Longannet to go  forward,” said Scotland’s First Minister Alex Salmond, who  supported the Longannet CCS project.

“The cost would have been less than a tenth of this year’s  alone estimated North Sea revenues of 13.4 billion pounds.”

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