UK Public Accounts Committee: CCUS Enquiry
Carbon Balance Initiative’s submission to the Public Accounts Committee highlights the urgent need for carbon storage obligations to create a self-sustaining UK CCS market. Current government reliance on public subsidies and the Emissions Trading Scheme is financially unsustainable and inadequate to meet 2030 climate goals. The submission recommends policy reform to shift costs to fossil fuel producers, accelerate CCS deployment, and align policy with the polluter-pays principle.
Read the full submission here
Our recommendations:
Conduct and publish a detailed and updated cost analysis of its CCUS programme, examining the full financial implications of Track-1 and Track-2 projects. This should include clear plans from DESNZ for managing escalating costs while safeguarding public finances.
Reform the current CCS funding to support medium to long term sustainability. The Government should analyse the risks and benefits of the current policy regime and identify the mix of mandate, market, and government policy tools needed for a self-sustaining CCS market.
Investigate the role of carbon storage obligations as a complementary tool to the Emissions Trading Scheme (ETS). This investigation should prioritise how such obligations can be designed to shift costs from taxpayers to actors in the fossil fuel supply chain while protecting UK competitiveness.
Publish specific timelines and milestones for reducing reliance on public funding while sustaining investor confidence over the medium to long term.
Develop contingency plans to address potential shortfalls in geological carbon storage capacity, recognising its critical role in achieving UK net zero commitments.