Leading U.K. Carbon Project Still Viable

Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland) - Plans to construct the U.K.'s largest carbon capture and storage (CCS) project are still viable despite losing the backing of the government almost a year ago.

2Co Energy (London, England), owner of the proposed Don Valley CCS project at Hatfield Colliery, near Doncaster, in Yorkshire is confident that it can secure private funding to get the project up and running by the end of the decade.

Jane Paxman, Policy and Communications Director at 2Co Energy told a government Energy and Climate Change Committee, that they remain 'optimistic' about creating a full scale carbon capture project.

"I have to say the Don Valley Project, which has the dubious distinction of being the one full value chain project that was deselected from the competition, yes, we are making a go of it on our own trying to deliver the commercial CCS that DECC says they want to get to in the 2020s. We now have to find a way of progressing the project without access to the capital grant that was available in the competition. We need to go ahead with the Contracts for Difference (CfD), hopefully enabling FID form of the CfD and early CfD. So we are optimistic--otherwise we would have packed up and gone home--that it is possible to do it with the CfD."

She added: " We are, of course, fortunate that we have access to an EEPR grant, which was total of €180 million, and that helps us through this equivalent stage where there are many tens of millions of pounds that need to be spent prior to the final investment decision. So that has been an enormous benefit to our project."

The 650-megawatt (MW) Don Valley project was hailed by the European Union (E.U.) as one of Europe's most promising CCS projects. It had already secured €180 million ($248 million) in funding. However, in November last year, it was overlooked when the U.K. government revealed its shortlist of CCS projects competing to win a share of its €1.2 billion ($1.6 billion) fund for large scale CCS projects. For additional information, see November 5, 2012, article - Leading U.K. Carbon Capture Project Cancelled.

Don Valley is an integrated gas combined-cycle (IGCC) plant that aims to capture up to 90% of its 5 million tons of CO2 emissions each year. The power station will cost about €3.6 billion ($4.7 billion) to construct.

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