Carbon capture funding rumours: every little €180 million helps

Five carbon capture and storage (CCS) projects across Europe look set to receive on the order of €180 million each from the European Union; and another project will get €100 million, after making it through to a whittled-down list of CCS projects deemed worthy of €1.05 billion in EU stimulus funding. The money must be used by 2010.

The Wall Street Journal reports EU sources revealing that the European Commission will approve funding applications from the Hatfield power plant in northern England (operated by Powerfuel); Vattenfall’s Jaenschwalde plant in Germany; Spain’s Endesa for its Compostilla plant; the Massvlakte plant owned by Germany’s E.ON and Belgium’s Electrable near the Dutch port of Rotterdam; and a scheme in Poland, run by Polska Grupa Energetyczna, or PGE SA. An Italian scheme should get €100 million, the paper says. Remember these names, there’ll be a quiz later.


Reuters has a similar story, though it reckons seven projects are on the list. None of the tipped project companies say they’ve received information. The European Commission is making no official comment, except to note that results of its evaluation have been passed to the member states, and that these, and the European Parliament, have yet to back the final list of projects. Only after that will the Commission publicly announce the winners, and begin contract negotiations with them.

The UK news is dismaying for Scotland’s Longannet power station (run by Scottish Power), which was among 13 projects in the running for the cash. Failure to secure the funding has “raised question marks” over the prospect of the plant winning £1 billion from the UK government in the country’s internal competition. Still, The Scotsman, carrying this story, notes that Hatfield’s more novel pre-combustion system (where coal is gasifed and carbon dioxide captured before that gas is burned) may have swung it the EU funds; Longannet has a more traditional set-up that captures carbon dioxide after combustion, a system that could be retro-fitted to existing coal-fired power plants.

€180 million is not enough to fund a full CCS demonstration project, of course. The lucky winners will be pleased at this helping EU hand, and implicit seal of approval, but will need to find more funding from somewhere to get going – at least €1 billion in total. There’s more EU funding to follow, including money set aside from the sale of carbon credits under the third phase of the European Trading System. Even so, a Reuters story in late September quoted one EU Commission adviser as saying that “We will not have (any) CCS plants operating in the EU in 2015.” It has an official target to build ‘up to 12’ commercial scale CCS plants by then – though that promise was made before the full impact of the global recession became clear.

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