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The Energy Technologies Institute (ETI) is offering up to £2 million to support the development of the business case for a phase two carbon capture and storage (CCS) project.
The money will be available to projects which identify the technical and commercial foundations and create a business case for the CCS plant, including identifying and establishing a vehicle to take the project forward to a final investment decision.
The ETI wants the project to plug into the CCS network that will be developed for the phase one projects – Peterhead in Scotland and White Rose in Yorkshire – and “deliver momentum into the next phase of CCS sector development”.
The key features of the project will include: sharing existing transport and storage assets to reduce costs, low planning time and costs, use of best proven technologies, “rapid and low risk” project delivery, attracting multiple investors in a co-venturing model, and a clear allocation of risk along the CCS chain.
ETI CCS programme manager Andrew Green said: “We will adopt a collaborative, co-venturing approach with our partners to enable risks to be shared amongst multiple investors and ensure that our co-venturers will be well-placed to take advantage of not just this investment opportunity but future opportunities presented by widespread CCS rollout.”
He added that the second round of CCS projects would have a significantly lower strike price than the first generation of CCS plants.
“Although initial CCS demonstration projects would require a high strike price, we believe that costs will fall rapidly to below £100/MWh for follow on projects as a result of sharing infrastructure, economies of scale, engineering learning and greater confidence from investors,” he said.
For this to happen, Green says it depends on implementing both the Peterhead and White Rose commercialisation phase one projects.
The Peterhead project was awarded a “multi-million” pound contract by government in February last year for a front end engineering and design (Feed) study, and the White Rose project received similar funding at the end of 2013.
“Phase two needs to be developed in parallel with phase 1 if widespread roll out of CCS is to be achieved by 2030 and this project will help achieve that aim,” Green said.
The deadline for notification of an intention to submit a proposal is 14 August, with the deadline for proposals to be submitted closing on 14 September.
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