Select Committee on Science and Technology Written Evidence


Supplementary evidence from E.ON UK, submitted by Mr Colin Scoins, Director of New Business


  The R&D effort within EON UK focused specifically on CCS power plant, is £1 .2 million in 2005, rising to £1.3 million next year. This does not include any of our project development activities, which are also gathering pace.

  In general, utilities such as EON do not spend a large proportion of their revenue on technology R&D because we are not technology developers / providers. Most of the commercial benefit from development of new technology is gained by the developers and providers of that equipment. Our R&D effort on CCS is therefore unusual, although other low carbon power generation options—including renewables—are also receiving similar attention. This reflects the importance E.ON UK attaches to this field, and our willingness to implement CCS as soon as the technology development and market conditions allow.

"Does the UK need a Carbon Capture and Storage Authority?"

The Need for a Carbon Capture and Storage Authority.

  In order to assess the value of creating a new Authority, we need to consider the role of Government in encouraging and implementing carbon capture and storage. We can then consider what structures would be most effective in delivering this.

The Role for Government

  We have identified a number of tasks we suggest should be undertaken by the UK Government to encourage and implement CCS within the UK.Establishing the Rules:

    1.  Establish a clear legal framework for CO2 storage both on-shore and off-shore. This includes working with other countries to amend marine treaties (London Convention and OSPAR) to remove the legal barriers they represent. The UK Government has a clear role in leading international opinion on this matter, and driving the necessary amendments. Other legislation (for example, the EC Groundwater Directive (1980) and UK Groundwater Regulations (1998)) should also be reviewed and may need amendment in order to give legal clarity.

    2.  Establish the planning and regulatory framework to allow granting of consents for both carbon capture, and for CO2 storage (both offshore and on-shore) in a transparent and timely manner. This includes ensuring appropriate Governmental policy direction to existing Government Agencies and planning authorities. This could involve carrying out an appropriate Strategic Environmental Impact Analysis.

    3.  Establish clear requirements for monitoring and inspection of CO2 installations, including storage sites, to ensure that industry can have confidence in the long term monitoring costs, and that the wider society can have confidence in the safety and integrity of the installations.

    4.  Establish the conditions under which CO2 storage sites can be capped off and decommissioned, with the transfer of long termliability for future CO2 emissions to the Government.

    5.  Promote the explicit inclusion of CCS as a carbon abatement mechanism within the EU Emissions Trading Scheme, working with the EU to ensure consistency between the EU regulatory requirements and UK regulatory requirements (including monitoring).

    6.  Establish suitable incentives to allow the first demonstration CCS projects to be financially viable. This is a complex subject, expected to involve Ofgem, DTI, DEFRA and HM Treasury.


    1.  The planning and consents process for CCS will need to be led and co-ordinated by Central Government (as now for large power stations and off-shore developments). This includes maintaining appropriate Governmental policy direction to existing Government Agencies and planning authorities to ensure an expeditious planning system. Currently for large power projects, the DTI handles planning consents.

    2.  Ongoing regulation and monitoring of CO2 storage sites will be required, and it is assumed the Government will need an agency to ensure this is being done.

    3.  The remaining CO2 emission from the capture sites and any fugitive leakage in transport (expected to be small) need to be verified for the purposes of the EU ETS. CO2 emission verification for the EU ETS is currently being undertaken by the Environment Agency on behalf of DEFRA.

    4.  Implementation of the financial incentives scheme, once established. The suitability and scale of incentives will need ongoing review as costs change, as the global consensus of climate change emerges, and as the EU ETS evolves.

    5.  Support for further research and development will be required to further reduce the costs of CCS. This is currently being provided through the DTI.

The Value of a Carbon Capture and Storage Authority

  We do not have strong views on how the Government should best organise itself to deliver the tasks listed above. We can see clear value in a dedicated authority to drive through the implementation of CCS. However, we do have a concern with the proposal to create a new Authority, that it may simply add a further stakeholder, complicating consents and adding bureaucracy. The existing implementation of the EU ETS already involves the EA, DEFRA and the DTI and this leads to some apparent duplication and delays.

  Therefore, if a new Authority is to be recommended:

    —  Its roles and responsibilities should be very clearly defined, with theminimum overlap with other departments and agencies.

    —  Where responsibilities are given to the new Authority, it should be clear that other interested government bodies (DTI, DEFRA, EA, Ofgem etc) cease to be responsible for those issues.

  In our view, it is equally reasonable to place the responsibility for CCS within an existing Government Department. However, in this case also, the responsibilities must be clearly defined with the minimum of overlap, and we suggest one individual should be responsible for ensuring collaboration and progress.

December 2005

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