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European carbon capture storage a speech by Charles Hendry

Posted by on Wednesday, 23 February, 2011


It’s an honour to be asked here today, and speak to you on how I see CCS moving forward. A subject very close to my heart, because its potential never ceases to amaze.

I think the advantages are clear. Fossil-fired electricity has a hatrick of ‘pros’. Reliability, availability and affordability!  It’s why fossil fuels will remain an important part in our future energy mix.

It’s not about low carbon versus affordability versus energy security. These must all work together.

This security is a major component to the economic regeneration that we are committed to starting.

Where CCS comes in

By 2020 well over half of the UK’s electricity generation will still be fuelled by coal and gas.

Look at the last few winters we’ve had? Look at how exceptionally cold and enduring they were.

We need to meet the challenge of de-carbonising the next generation of our fossil fuel-fired power stations.

That is why CCS is such a crucial element of this Government’s energy and climate change agenda. It is the only technology that can significantly reduce CO2 emissions from fossil fuel power stations – by as much as 90 per cent.

And it will play an important role in balancing the electricity system. Without CCS, halving emissions by 2050 will be 70 per cent more expensive.

CCS and green growth

We have already put in place one of the most comprehensive policy and regulatory frameworks in the world to encourage investment in CCS….

Europe also has a natural advantage in the form of the storage capacity available under the North Sea. The potential is enormous.

The estimated CO₂ storage capacity of the UK and its continental shelf alone is 22 GTonnes. That’s roughly 100 years of capacity for emissions from the power sector.

Demonstration of CCS

In the UK we have amongst the most advanced plans for a fossil fuelled power station with CCS anywhere in the world. We know better than anyone how difficult demonstration of CCS will be.

The market conditions are not adequate to fund the development and deployment of CCS at the pace we need.

That is why, as part of the Spending Review last October; we announced that up to a billion pounds will be invested in one of the world’s first commercial-scale CCS demonstrations on coal-fired electricity generating plant.

Projects 2-4

We know that 1 demonstration project is not sufficient in moving CCS to being a technically and commercially viable technology within the time frames required to meet our carbon reduction targets. That is why we have a commitment to continue public sector investment in a further 3 demonstration projects.

International policy

The work we do in delivering our first demonstration plants will provide large-scale exemplars. I want to see the experience and knowledge from these projects shared widely. We must learn from each other and share that knowledge with the rest of the world.

And we are supporting CCS capacity building in developing countries through the Carbon Sequestration Leadership Fund.

Domestic policy

This Government has, and will, put in place policies and regulatory frameworks to facilitate CCS but we must work with industry to address the delivery issues – the technical, financial and commercial challenges – if demonstration projects are to be built on time and CCS is to become commercially viable. That is why we set up the UK’s CCS Development Forum – to bring together leaders from industry, NGOs and the public sector to hold the Government to account on its CCS commitments.

We are also developing a CCS Roadmap to 2050 which will articulate our proposed timescales and set out the key technical, policy and commercial issues which need to be addressed, by when, and by whom, if CCS is to be commercially deployed from the 2020s and contribute to achievement of our 2050 target.


More than £110 billion of investment is needed in the UK in new power stations and grid upgrades over the next decade.

The hardest and most important challenge for the Department is on electricity market reform (EMR).

We want to drive investment in the UK and ensure this doesn’t go overseas, so we will ensure that the right level of an EPS is set and this is seen as a beacon of our long term investment framework


In short we need more energy but fewer emissions. And so to end where I began: the challenge is vast, the prospects daunting but it’s all within our reach. The glass is most definitely half full.

Much of the investment will have to be significantly bigger than in the past. And we need to take the public with us. Safety is a priority, but we also need to ensure we are explaining the benefits of CCS.

I’m grateful for the opportunity to share my thoughts with you all, and I look forward to hearing yours.

You can read the full speech here:

Fossil Fuels