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No new coal without CCS - Miliband

DEPARTMENT OF ENERGY AND CLIMATE CHANGE News Release (Reference: 2009/050) issued by COI News Distribution Service on 23 April 2009

Up to four clean tech plants to be built in UK

A future that curbs emissions from new coal fired power stations, and will see the UK lead the world in the development of carbon capture and storage (CCS) technology, was proposed by Ed Miliband today.

Setting the UK at the forefront of the global race to decarbonise fossil fuels, he set out to Parliament proposals for the basis on which coal fired power which will be permitted in the future:

* No new coal without CCS demonstration from day one. Alongside the Government's ongoing competition to build a post-combustion demonstrator, up to three further projects including pre-combustion technology, will be funded by a new levy mechanism.

* Full scale retrofit of CCS within five years of the technology being independently judged as technically and commercially proven. We envisage an important role for the Environment Agency in making an independent judgement of when the standard is met.

The Government will also seek views on whether it is possible to implement these conditions through an emissions performance standard.

These proposals form part of a consultation that will be released in the summer, alongside an environmental report.

They will place the UK firmly at the forefront of developing CCS technology to commercial deployment, opening up a new advanced green manufacturing industry and aiding the global effort to fight climate change.

Ed Miliband said:

"The future of coal in our energy mix poses the starkest dilemma we face: it is a polluting fuel but is used across the world because it is cheap and it is flexible enough to meet fluctuations in demand for power.

"In order to ensure that we maintain a diverse energy mix, we need new coal-fired power stations but only if they can be part of a low carbon future.

"With a solution to the problem of coal, we greatly increase our chances of stopping dangerous climate change. Without it we will not succeed.

"CCS is the only technology with the potential to reduce emissions from fossil fuels by up to 90%. But there must be a global effort to develop this technology and the UK is in a strong position to lead this charge.

"This signals the era of unabated coal is coming to an end, and a new low carbon future for coal with CCS can begin.

"There is no alternative to CCS if we are serious about fighting climate change and retaining a diverse mix of energy sources for our economy."

The new demonstrations will be funded by an incentive mechanism as announced by the Chancellor yesterday. Proposals for how the incentive will work are being developed.

The measures will help create in Britain a new high tech, low carbon industry characterised by more jobs in advanced green manufacturing:

* CCS clusters in the regions where we can achieve the greatest emission reductions most economically. For example Thames, Humberside, Teesside, Firth of Forth and Merseyside

* A new future for the North Sea industry, capitalising on the UK's abundance of offshore storage sites for CO2

* Research suggests that carbon abatement technologies could sustain 50,000 jobs by 2030.

Coal currently accounts for 37% (29GW) of the UK's electricity capacity, generating 31% of the UK's electricity in 2008. That is set to decline to 21GW as stations close in accordance with EU controls on sulphur and nitrogen emissions that cause acid rain. Coal is an abundant source of fuel and carbon abated coal has a role to play in the future mix, providing diversity alongside renewables, nuclear and gas.

The Government today also published its response to last year's consultation 'Towards Carbon Capture and Storage', which sets out our approach to carbon capture readiness. This will apply to all new gas, oil, biomass, waste-to-energy and also coal power station applications on or above 300MW. The Government will only consider applications if they:

* Confirm sufficient space available to retrofit CCS

* Identify a suitable potential offshore area to store carbon dioxide

* Map a feasible potential transport route from the power station to the storage area and

* Do not have foreseeable barriers to retrofitting CCS.

Together, these criteria will prove a power station is 'carbon capture ready'.

Notes to Editors:

1. A consultation document, setting out our proposals for England and Wales in more detail, will be published alongside a partial Impact Assessment and an Environmental Report in summer 2009. An outline in published today at http://decc.gov.uk/en/news/.

2. Decisions on any applications to construct a new coal power station will be taken once this consultation process has been completed.

3. CCS is a type of carbon abatement technology in which the carbon dioxide in fossil fuels is captured either before or after combustion and committed to long-term storage in geological formations. The technologies involved in CCS are not novel but have not yet been demonstrated together at scale on a power station.

4. The Committee on Climate Change recommended that conventional coal-fired power generation should only be built on the expectation that it will be retro-fitted with CCS by the early 2020s.

5. The demonstrations proposed will be on around 400MW of gross generation output (300MW net output).

6. The 'Towards Carbon Capture and Storage' consultation response is available on our website at http://www.decc.gov.uk/en/content/cms/consultations/closed/closed.aspx.

7. The Chancellor yesterday announced an extra £1.4 billion in support for low carbon industries ranging from energy efficiency and renewables through to carbon capture and storage. These measures, together with announcements made since last autumn when the downturn started, will enable an additional £10.4bn of low carbon investment over the next three years. The extent of the UK's investment in low carbon is set out in "Investing in a Low Carbon Britain", published today at http://www.decc.gov.uk/en/content/cms/news/090423_low_car/090423_low_car.aspx.

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