Arup report lays out blueprint for a successful UK carbon market

The sector is currently reliant on government support but the pathfinding report, commissioned by Offshore Energies UK (OEUK), outlines nine key steps for the creation of a commercial framework which will provide a springboard for a self-sustaining CCS industry in the UK.

More than 120 of OEUK’s 400-plus member organisations are already active in the UK’s CCS sector, demonstrating the strong transferability of skills and capabilities from the oil and gas industry to CCS.

The report, Carbon Capture & Storage in the UK: Accelerating towards the merchant model Nine steps to unleash a commercially self-sustaining CCS industry in the UK, underlines the need for the UK to accelerate development of the so-called Track-1 projects, the East Coast Cluster carbon storage scheme which will decarbonise heavy industries in Teesside, Humberside, and the Hynet CCS scheme which will perform the same function on Merseyside.

It also calls on the government to make a full commitment to the Track-2 plans for two further carbon capture clusters, Acorn in northern Scotland and Viking on Humberside, which are due to be operational by 2030.

Once these projects are up and running the UK will offer a sustainable international carbon capture and storage market with revenue generated from the sale of carbon capture, storage and transportation services to industrial emitters.

Further revenue will be generated by European Union or UK carbon emissions trading schemes, and by trades in carbon as a by-product of hydrogen production, cement production and other energy intensive industrial processes.

Among the other key areas identified by the report for the development of a carbon trading market, are network interconnectivity, technological advances and reducing the cost of CCS within the value chain of finished products. 

To meet government net zero commitments, the UK must capture and store 20-30 million tonnes of carbon dioxide per annum by 2030 and 40- 50 million tonnes per annum by 2035. 

The UK Continental Shelf is a globally important producer of oil and gas and has huge potential to safely store industrial emissions in depleted oil and gas fields and saline aquifers. The UK can therefore play a major role in helping European nations store carbon emissions and meet its own net zero targets while promoting energy security, protecting industrial activity and prolonging the value of North Sea infrastructure.

Enrique Cornejo, OEUK’s Head of Energy Policy, said: “The UK’s CCUS sector has marked an important milestone with the East Coast Cluster reaching financial investment decision and the granting of the first CO2 storage permit for the Endurance carbon storage site in the North Sea. 

“We want to see a self-sustaining CCS market within the next decade for gas-fired power, cement, waste to energy and hydrogen production. This depends on cost reductions by better collaboration and use of technology, and the development of a pan-European carbon market with the UK at its core.”

Robert Hines, Senior CCS Consultant at Arup, commented: “CCS has an important role to play in decarbonising hard to abate sectors by 2050. The UK has the foundations to become a major carbon storage provider, drawing from the skills of its oil and gas industry and geological resources that have the potential to provide vast amounts of storage. A self-sustaining commercial market is what everyone is aiming for, and this report highlights viable routes to get there.”

View the report here