WIREDGOV

Commenting on the statement this afternoon by the Secretary of State for Energy & Climate Change, Chris Huhne, that the Longannet Carbon Capture and Storage Project will not go ahead, First Minister Alex Salmond said:

"This is a deeply disappointing announcement by the UK Government, and an enormous lost opportunity. While responsibility lies with DECC, the Scottish Government co-operated extremely closely with Chris Huhne and his colleagues, and did everything we possibly could over a long period of time to help make this project happen.

"It is just as bad a decision as when the previous UK Government abandoned the Peterhead pre-combustion gas carbon capture project four years ago - which the current coalition parties rightly criticised in 2007.

"The fact is that the UK Government's Electricity Market Reform process is undermining industry confidence and investment planning - with higher costs due to the Carbon Floor Price, and uncertainty over long-term support for carbon capture and storage.

"Between public and private investment, Longannet would have been a 2 billion pound investment - exactly what is needed in the present economic climate. It underlines the need for a Scottish energy strategy so that we have proper planning, and apply our energy wealth of today to ensure that we are equipped for the technologies of tomorrow.

"At the end of the day, this technology requires the courage and the vision to make the investment happen, and that is what has been lacking in successive Westminster administrations. 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. The cost would have been less a tenth of this year's alone estimated North Sea revenues of 13.4 billion pounds.

"We are led to believe that Peterhead is a contender for a future gas carbon capture project, but that was supposed to be the case four years ago. From Scotland's perspective, history has already repeated itself with the failure to proceed with Longannet, and what guarantees are there that we will not be disappointed yet again? As we now know to our cost twice over, warm words are not enough.

"The Longannet announcement also has serious implications for the long-term future of coal production in Scotland, as the renewal and upgrading of the site was to be part and parcel of the CCS investment.

"With our unrivalled resources, decades of experience in the North Sea and an excellent base in science and engineering, Scotland is the natural home for developing, deploying and exporting CCS technology. The failure of UK Ministers to go ahead with Longannet is deeply disappointing, and the Scottish Government will continue to do everything we can to turn Scotland's great CCS potential into reality."

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