The government has selected four carbon capture and storage (CCS) projects out of a total of eight to move to the next stage of its £1bn competition.

It is providing this funding to support the development of the technology, which it believes will be a major weapon in the fight against climate change and provide a valuable export service.

However, there was surprise that the Don Valley CCS project was omitted from the shortlist, as it was believed to be the top favourite.

The shortlist contains:

  • Shell and SSE's 40 MW post-combustion capture retrofit to the existing 1180 MW combined cycle gas turbine power station at Peterhead
  • Summit Power's Captain Clean Energy Project, a 3570 MW fully abated coal integrated gasification combined cycle power plant in Grangemouth, in partnership with Petrofac, National Grid and Siemens
  • Progressive Energy consortium's pre-combustion coal gasification project on Teesside
  • Alstom's 'White Rose' oxyfuel capture system at Drax's proposed new 304 MW coal-fired power station in North Yorkshire.

Energy secretary Ed Davey said the finalists had "really risen to the challenge" set by the competition, adding that they must now demonstrate that they can deliver value for money to taxpayers.

"The projects we have chosen to take forward have all shown that they have the potential to kick-start the creation of a new CCS industry in the UK," he said.

Britain's plan is parallel to a concurrent EU competition, called NER300, which has earmarked two UK-based projects as contenders to win up to 337 million euros per scheme. The winners of this competition will be announced at the end of the year.

No more than three projects will receive funding in this round. DECC said it will support one British renewable energy project and the two remaining CCS projects that remain in the UK process in the NER300 competition.

There is a reserve list in this competition, and a further renewable energy project and another of the four CCS shortlisted projects will go forward to that list.

In summary, Teesside CCS, White Rose Oxyfuel CCS and Sound of Islay Tidal are the three candidate projects, and Peterhead CCS and Kyle Rhea Tidal Turbine Array are the reserve projects.

Dr Stephen Brown, director at CO2Sense, the low-carbon expert consultancy that leads the Yorkshire and Humber CCS Cluster Steering group, said: “We welcome the news that the government has recognised Yorkshire as a strong base for CCS.

"The economic and environmental benefits of the White Rose Project are clear and we are pleased that it is still a strong contender for funding.”

But he added: “However, the decision not to shortlist the Don Valley Power Project is a shock, given that it is the top ranked project in a parallel process run by the European Commission. It suggests the Government’s intent to push any major financial commitment to CCS into the next Parliament.”

Dr Brown’s comments reflect the surprise of many in the CCS industry that 2Co Energy’s Don Valley Power Project has missed out on the shortlist. The project was ranked number one in Europe and projected to reach financial close in 2014, delivering 2,500 jobs and hundreds of millions is economic benefits between 2014 and 2019.

A DECC spokesman said Britain's decision was made on affordability, deliverability and value for the taxpayer.

CO2Sense is concerned that the combination of these factors will push back any CCS investment into to the next parliament.

It is now more likely that a coal-fired power plant at Belchatow in Poland that is the biggest emitter of carbon dioxide in the EU, will win the European Commission competition, as it is in second place to receive funding.

Story: David Thorpe, News Editor