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NETWORK / 11 / OCTOBER 2016 A S I X - P O I N T P L A N T O F R E E T H E C C S L O G J A M The Oxburgh report in brief The Parliamentary Advisory Group on Carbon Capture and Storage has called for "immediate government action" to develop CCS and "save billions". A report published in September by the group, set up in the wake of George Os- borne's decision to scrap the £1 billion CCS competition, has set out a six-point plan to "free the logjam" that has blocked the development of the technology, which many believe will be vital to the UK achieving its CO2 reduction targets. The plan includes the creation of a new publicly-owned delivery body similar in concept to the Olympics Delivery Authority or Crossrail to kick-start the technology's implementation. The group's chairman, Lord Oxburgh, said the private sector is not institutionally capable of developing the necessary pipeline and storage networks. The group's report says that by 2030, some 15% of UK CO2 emissions could be safely and permanently stored in geological formations off the coast of Britain. By 2050, CCS could reduce emis- sions by as much as 40%, saving up to £5 billion a year compared with alterna- tive strategies. It also recognises that the heat sec- tor may be the most important sector for CCS in the long-term, but also the most challenging in the medium term. It recommends the creation of a heat trans- formation group to undertake further preparatory work because, whichever route is chosen for the decarbonisation of heat, CCS will be required. The group accepts the government's justifi cation for the scrapping of the com- petition due to project costs that were too high, but insists this was due to the design of the competition. It says massive savings in the cost of CCS implementation can be achieved if the government accepts that the public sector has a leadership role. Even without such a body it says that CCS technology for power generation is now ready to deploy at costs of £85/MWh over a 15-year period, signifi cantly below the requirements for nuclear power and comparable to many renewable options. That's half the amount that would have been needed to support the projects bidding in the scrapped competition. According to the chairman of the advisory group, Lord Oxburgh: "Britain can show global leadership in tackling the problem of global warming by deploying CCS and exploiting our natural advantages to the full." Key milestones 1 3 4 5 6 7 8 Funding of CCSDC and HTG; implementation of recommendations First investment decision for a full-chain power project Implementation of a CCS certificates system and award of early industrial contracts Role of hydrogen vs electricity in heating determined Start of rollout of heat solution Start of CCS Obligation on fossil fuel suppliers Potential privatisation of CCSDC or its subsidiaries 2 First investment decision on pure stream industrial projects CCSDC (Power, transport and storage ) 2017 2020 2025 2030 Develop portfolio of power plants at hubs Construction programme of power plants at hubs Operate power plants at hubs Industry Construct Operate Pure emissions projects Industrial capture contracts Awards ongoing as relevant hubs brought online Construction of capture and connection Operation PowerCo T&SCo & 4 1 8 2 Regulatory / incentive framework Rate of return style regulatory framework CCS Obligation System CCS Certificate System 3 7 Industrial capture contracts awarded Heat (by hydrogen or electricity) 2013 -2021 2021 - 2029 2029-2038 Appraisal programme Facilitate industry readiness Support implementation Feasibility and development Implement Operation Development and planning Implement 5 6 Gas regulatory periods HTG Pilot project National roll - out Electricity regulatory periods 2015 -2023 2023 -2031 …