The UK government has committed nearly £22 billion to Carbon Capture, Utilisation, and Storage (CCUS) technology, but MPs have raised concerns over its financial impact on consumers. The Public Accounts Committee (PAC) warns that the policy could lead to significant increases in household and business electricity bills.
What is CCUS and Why is it Controversial?
CCUS technology captures carbon dioxide (CO2) emissions from industrial processes and stores them underground, preventing them from being released into the atmosphere. It is considered an essential tool for achieving the UK’s net zero target by 2050.
However, critics argue that CCUS remains an unproven technology, particularly in the UK. “It is an unproven technology, certainly in this country. And we are concerned this policy is going to have a very significant effect on consumers’ and industry’s electricity bills,” said Sir Geoffrey Clifton-Brown, chair of the PAC.
Government’s Stance on CCUS
Energy Secretary Ed Miliband defended the initiative, acknowledging its novelty but emphasizing its necessity in the fight against climate change. “CCS is an innovative technology in terms of being used at scale, but all the expert advice — UK Climate Change Committee and others — say if we don’t do this, we are never going to cut global emissions,” he stated.
The UK government aims to reduce CO2 emissions by at least 50 million tonnes annually by 2050, with CCUS playing a crucial role. The investment will primarily fund carbon capture clusters in Merseyside and Teesside, which are expected to generate jobs and attract private sector investment.
Concerns Over Funding and Consumer Impact
The PAC expressed concern over the funding model, which relies heavily on consumer energy bills to finance three-quarters of the CCUS projects. The committee criticized the government for failing to assess the financial burden this would impose on households, particularly during a cost-of-living crisis.
Moreover, the government has signed contracts with CCUS developers without securing benefits for taxpayers. “If you were a venture capitalist investing this sort of sum of money, which is effectively what the taxpayers are doing here, you would expect to have a big equity stake in this whole thing,” said Sir Clifton-Brown. The committee has urged the government to include profit-sharing mechanisms in future agreements to ensure the public gains financial benefits.
Industry Experts Weigh In
Some experts disagree with the committee’s classification of CCUS as “unproven.” Dr. Stuart Jenkins, a research fellow at the University of Oxford, argued that the technology is well-established worldwide. “I really don’t like the phrase ‘unproven’ technology; it is not representative of the status of the technology as an engineering problem,” he stated. He noted that 45 commercial CCUS facilities are already operating globally, capturing around 50 million tonnes of CO2 annually, with over 700 more in development.
Nonetheless, Dr. Jenkins agreed that the current funding model raises questions about sustainability. Some researchers suggest an alternative approach, such as a carbon storage mandate, which would require fossil fuel producers to store a portion of their emissions or face financial penalties.
Looking Ahead
The government expects its £21.7 billion investment to unlock an additional £8 billion in private sector funding over the next 25 years. However, the PAC has urged a reassessment of the financial impact on consumers and proposed that future contracts include mechanisms for public profit-sharing.
As the UK pushes toward its net zero goals, the debate over CCUS funding and its long-term viability remains a key issue for policymakers, industry leaders, and consumers alike.
