Almost £22bn pledged for 2 carbon capture and hydrogen sites

The UK government today announces major funding for 2 carbon capture sites will inject growth into of the North West and North East of England – directly creating 4,000 jobs and supporting 50,000 jobs in the long-term.

Today’s announcement confirms up to £21.7 billion of funding available, over 25 years, to make the UK an early leader in 2 growing global sectors, CCUS and hydrogen, to be allocated between these 2 clusters. The UK’s commitment was first made in 2009, and the confirmation of funding today represents a major success story for British industry.

CCUS technology removes CO₂ emissions before it reaches the atmosphere and stores it safely beneath the seabed – using tried and tested technology that has been deployed across the globe for over 20 years.

The new carbon capture and CCUS enabled hydrogen projects will help remove over 8.5 million tonnes of carbon emissions each year – the equivalent of taking around 4 million cars off the road.

Prime Minister Keir Starmer, the Chancellor Rachel Reeves, and Energy Secretary Ed Miliband are visiting the North West today to confirm the funding for 2 sites in Teesside and Merseyside, which are expected to bring in £8 billion of private investment into these communities.

Prime Minister Keir Starmer said, “We’re reigniting our industrial heartlands by investing in the industry of the future.

“Today’s announcement will give industry the certainty it needs – committing to 25 years of funding in this groundbreaking technology – to help deliver jobs, kickstart growth, and repair this country once and for all.”

In the week in which Britain became the first industrialised nation to end its 150-year usage of coal to produce power, the nation now begins a new era of clean energy technology. The UK has enough capacity to store 200 years’ worth of emissions – making CCUS a revolutionary method in tackling the climate crisis and helping industry to decarbonise.

Energy Secretary Ed Miliband said, “On Monday, 150 years of coal in this country came to an end. Today, a new era begins. By securing this funding, we pave the way for securing the clean energy revolution that will rebuild Britain’s industrial heartlands.

“I was proud to kickstart the industry in 2009, and I am even prouder today to turn it into reality. This funding is a testament to the power of an active government working in partnership with businesses to deliver good jobs for our communities.”

This announcement will also help turbocharge the low carbon hydrogen sector by paving the way for the UK’s first large-scale hydrogen production plant, decarbonising vital industrial sectors.

It also marks a game-changing development in the mission to tackle climate change – protecting the environment from harmful emissions at a time when the UK has seen a year of record-breaking temperatures. It follows advice from the independent Climate Change Committee, who described CCUS as critical for decarbonising the UK’s heavy industry and a “necessity” for the UK to reach its legally binding target for net zero emissions by 2050.

Similarly, the International Energy Agency and the Intergovernmental Panel on Climate Change have endorsed CCUS as a critical tool in decarbonisation, particularly in heavy industry such as cement and steel.

The carbon capture, usage and storage industry is expected to support 50,000 good, skilled jobs as the sector matures in the 2030s, helping to support the oil and gas sector’s transition away from high emission fossil fuels by using the transferable expertise of their workforce. This supports the UK’s mission for growth, while putting the country at the cutting edge for developing the skills of the future.

An up and running carbon capture industry is expected to add around £5 billion per year to the UK economy by 2050 and the backing of these 2 sites sends a clear signal to investors that the UK is open for business.

As part of the partnership with GB Energy and The Crown Estate, the progress on Track-1 comes as The Crown Estate awarded an Agreement for Lease to Eni to repurpose existing infrastructure to transport and store CO₂, reducing cost and environmental impact.

James Richardson, Acting Chief Executive of the Climate Change Committee, said, “It’s fantastic to see funding coming through for these big projects. We can’t hit the country’s targets without CCUS so this commitment to it is very reassuring. It will no doubt provide comfort to investors and business about the direction of travel for the country.

“We know these projects will provide good, reliable jobs in communities that need them. It is important that prosperity for these parts of the country is built into a clean energy future.”