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Clean coal technology could bring between £2-4 billion a year into the UK economy by 2030, and support between 30,000-60,000 in jobs such as engineering, manufacturing and procurement, according to new independent research published today.

The report, ‘Future Value Of Coal Carbon Abatement Technologies To UK Industry’ by AEA Group, is published today alongside the Government’s consultation document ‘A framework for the development of clean coal’.

As outlined by Ed Miliband to Parliament on 23 April, the consultation details how the Government proposes to reconcile the need to curb emissions of carbon from future coal fired power stations with the need to maintain a secure diverse energy mix.  It proposes:

• Requiring CCS demonstration: New coal fired power stations should only be given consent in the UK if they demonstrate CCS on at least 300MW net (around 400MW gross) of capacity from day one.  Each demonstration project would have to store 20 million tonnes of CO2 over 10-15 years.  The proposed framework recognises that CCS demonstration will only proceed with Government intervention.  A financial incentive funded by electricity suppliers will support up to four commercial-scale CCS demonstrations in the UK.  Alongside the Government’s ongoing competition to build a post-combustion demonstration, up to three further projects including pre-combustion technology could be supported.  The primary legislation required to implement this mechanism will be sought at the earliest possible opportunity.
• Requiring CCS retrofit:  All new coal fired power stations should be required to retrofit CCS to their full capacity within five years of CCS being proven.  We are planning on the basis that this point will be reached by 2020, and an independent review, potentially led by the Environment Agency, would report in that year on the status of the technology. The consultation document also explores whether this requirement should apply to existing coal fired power stations.
• Contingency: In the event that CCS takes longer than expected to be judged proven, further measures may be needed to ensure emissions from coal are substantially reduced.  These measures could include an annual cap on individual power stations’ emissions, a limit on running hours or an emissions performance standard that would limit the amount of CO2 that could be emitted per unit of electricity generated.

Energy and Climate Change Secretary Ed Miliband said:

“The conditions we’re proposing for new coal are the most environmentally ambitious of any country in the world, requiring the demonstration of CCS on a substantial proportion of any new power station and the 100% retrofit of CCS when it’s proven. 

“At the same time, by providing funding for demonstrations, we can maintain coal as part of our energy mix, supporting diversity and therefore security of supply.

“By acting early, jobs will also be created as Britain develops the expertise in what could be a major new industry, with CCS projects offering the potential to form the hubs for clusters of low carbon industries.

“By driving the development of CCS in this country, we are also, as a country, playing an essential role in the battle against climate change.”

Notes for editors

1. Coal currently accounts for 37% (29GW) of the UK’s electricity capacity, generating 31% of the UK’s electricity in 2008.

2. These proposals were first outlined to Parliament by Ed Miliband on 23 April.  His statement can be found at: www.decc.gov.uk/en/content/cms/news/090423_ccs_sta/090423_ccs_sta.aspx

3. The consultation document is published alongside an Environmental Report and Impact Assessment.  Views are sought on all three documents and they are available at:
www.decc.gov.uk/en/content/cms/consultations/open/open.aspx

4. The closing date for responses to the consultation is 9 September 2009. 

5. Also published today and available online are:
www.decc.gov.uk/en/content/cms/what_we_do/uk_supply/energy_mix/ccs/ccs.aspx

• "Future Value of Coal Carbon Abatement Technologies to UK Industry", AEA Technology, June 2009 
• "Technical Analysis of CCS Transportation Infrastructure", Parson Brinckerhoff, May 2009 
• "Developing a Regulatory Framework for CCS Transportation Infrastructure (Volume 1 & 2)", NERA Economic Consulting, May 2009

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