CCS scheme cancelled due to Government disagreements

A publicly funded carbon capture and storage (CCS) scheme to reduce carbon emissions was cancelled after a disagreement between government departments, a report by the National Audit Office has found.

Ministers launched a competition for developing technology to capture carbon emissions before Treasury officials cancelled the project. The carbon capture and storage (CCS) competition was the second attempt by the government to build technology that could absorb and dispose of carbon dioxide from power stations or heavy industry. 

Auditors concluded that a failure by the Treasury to agree the long-term costs of the competition with the Department for Energy and Climate Change (DECC) contributed to its cancellation in 2015, when ministers had already spent £100m on the scheme.

Meg Hillier, the chair of the public accounts committee, claims that the scheme was “hugely ambitious and expensive” but was in sight of a breakthrough when it was stopped.

“The then-DECC failed to convince HM Treasury but ultimately the taxpayer lost out both financially and in the ending of this programme to reduce carbon emissions,” she said.

“Taxpayers will be alarmed that disagreement between departments means the taxpayers have little to show for the £100m the government spent on the competition.”

It would cost the UK £30bn to meet targets to cut greenhouse gases by 2050 without CCS, auditors believe, and it is “currently inconceivable” that such technology would be developed without government support.

A spokesperson for the Department of Business, Energy and Industry Strategy added: “We haven’t closed the door to carbon capture and storage technology in the UK, but decisions had to be taken to control government spending and protect consumer bills. 

“This is why the government ended the funding for the CCS competition, and ensured taxpayers were protected from significant costs when the competition closed."

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