3.82 CCS is a technology that involves fitting CO2 capture technology (either pre or post-combustion of fuel) to fossil fuel power stations, transporting the captured CO2 via pipes, and injecting it into long term storage sites such as abandoned gas and oil fields in the North Sea. It has yet to be demonstrated on a commercial scale. The advantage of CCS is that it could enable electricity generation based on burning coal and gas (which can be turned up or down quite rapidly) to be deployed alongside low carbon sources such as nuclear (which tend to be quite inflexible) and offshore wind farms (which tend to be intermittent and therefore need to be backed up by some form of flexible generation). However, to be commercially deployable, the cost of producing electricity using CCS technology will need to be competitive with that from other low carbon technologies. Government intervention is targeted at reducing the costs of CCS technology so that it is cost-competitive in the 2020s.
3.83 The Government announced in October 2011 that it would not proceed with the full chain CCS demonstration project at Longannet in Scotland because an acceptable deal could not be concluded. There are a number of promising CCS projects proposed in the UK and the Government will launch a selection process as soon as possible. The Government's long term strategy for CCS deployment, together with an industry action plan, will be set out when the selection process is launched. All findings gained through the Front End Engineering and Design studies undertaken for the first demonstration competition are available on the Department of Energy and Climate Change website to help speed up the wider deployment of CCS both in the UK and abroad.
3.84 To enable successful demonstration and deployment of CCS technology, the Government will:
• run a programme of CCS projects focused on reducing the costs of CCS technology to enable commercial deployment in the 2020s. The Government has already committed £1 billion of public funds for this programme;
• work with industry to consider how to most effectively encourage the development of the infrastructure needed to deploy CCS in the economy; and
• ensure the widespread dissemination of the knowledge developed as part of the CCS technology programme and ensure that UK policies and activities are informed by activities taking place internationally.