Lack of budget agreement led to failure of CCS competition, NAO concludes

Failure to agree the total cost of government support for a competition to build the UK’s first carbon capture and storage (CCS) plant was a key reason behind the Treasury’s sudden withdrawal of funding, a review has concluded.

The National Audit Office (NAO) scrutinised the way the energy and climate change department (now the Department of Business, Energy and Industrial Strategy (BEIS)) ran the competition. The contest was the second attempt by the government to kick-start a CCS industry in the UK after the first failed in 2011. 

In a report of its findings, the NAO noted that £1bn capital to support construction of a CCS plant was clear from the outset of the second competition. However, there was less clarity on the revenue support that would be available through consumer-funded contracts for different (CfDs), which fix the price developers ...

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