Climate Change Plan: third report on proposals and policies - written statement

Industry

Economy, Jobs and Fair Work Committee

1. The Committee believes that there is merit in exploring options for the future use of the existing asset at Peterhead and that CCS represents an opportunity to do so. (68)

• Our funding contribution to the Acorn CCS Project committed to in the Programme for Government 2017- 2018 will contribute to policy to see CCS demonstrated at a commercial scale by 2030. The Acorn feasibility study aims to demonstrate a lowest cost full-chain CCS project that specifically targets industrial emissions in St. Fergus. Subsequent project phases of this project would aim to establish the UK's first full chain CCS demonstrator.
• Our funding of Scottish Carbon Capture Storage (SCCS) includes a programme of work to identify options for CCS demonstration and innovation which contributes to the ambition in the Plan to see CCS demonstrated at commercial scale by 2030. We will consider any options proposed for the incorporation of CCS at the existing Peterhead Power Station.
• For CCS to progress to commercial scale it is essential that the UK Government provides a robust policy framework to support full chain CCS. In their Clean Growth Strategy the UK Government committed to set up a Ministerial-led Carbon Capture Utilisation Storage (CCUS) Council with industry and a CCUS Taskforce with a remit to deliver a cost-reduction deployment pathway for CCUS. The first meeting of the UKG's CCUS Council took place on 29th January 2018 followed by the larger CCUS Taskforce held on 7th February 2018. Scottish Government officials attended both meetings and we will continue our engagement as part of these forums going forward.
• CCS is the only large scale emissions reduction technology for some of our largest energy intensive industry. If the UK Government do not provide a suitable policy environment for the storage of CO₂ in our offshore storage reserves it is likely that CO₂ will still need to be captured and exported at considerable cost for offshore storage internationally, most likely in Norwegian stores. In that scenario both Scotland and the UK would lose the opportunity to be an import destination for CO₂ from other countries and the economic and employment benefits of developing our own CO₂ storage industry.

2. The Committee noted the aim in the Plan to demonstrate technologies such as hydrogen and CCS at commercial scale by 2030. The Committee recommended that the final Plan should contain more detail on how the policy outcomes for industry will be achieved and implemented. (173)

• The Scottish Government is monitoring the progress of Scottish Gas Network's current feasibility study funded by OFGEM which in its next phase looks to demonstrate a 100% Hydrogen Gas network system for heat pilot in Scotland. If successful, this may in turn open up opportunities for fuel-switching options to zero-emissions hydrogen in industrial processes.
• Our funding contribution to the Acorn CCS Project in St, Fergus committed to in the Programme for Government 2017 - 2018 will contribute to our policy to see CCS demonstrated at a commercial scale by 2030. The Acorn feasibility study aims to demonstrate a lowest cost full-chain CCS project that targets industrial emissions. Subsequent project phases would aim to establish the UK's first full chain CCS demonstrator.