Industry questions Commission’s CCS shortlist

www.environmental-finance.com
8 October

The European Commission has proposed a list of six carbon capture and storage (CCS) projects to receive a total of €1.05 billion ($1.6 billion) in funding, but industry representatives are concerned about the lack of transparency involved in the selection procedure. EU leaders agreed in March to reallocate €5 billion of unspent 2008 agricultural funding on stimulating EU business. They decided that €1.05 billion of these funds would be spent on helping to commercialise CCS technology.

The projects that were presented to EU member states experts last week as eligible for funding included: Powerfuel's Hatfield plant in Yorkshire, England; Vattenfall's Jaenschwalde plant in Germany; Endesa's Compostilla plant in Spain; the E.ON-run Maasvlakte plant in the Netherlands; and the Belchatow project in Poland, which is managed by Polska Grupa Energetyczna. If the draft list is approved, these five projects are expected to receive €180 million each. A sixth project, Porto Tolle, run by Enel in Italy, is in line for €100 million.

Eleven projects from across the EU were submitted by the mid-July deadline, but only one project per member state was eligible for funding. In addition to Hatfield, three UK projects had submitted funding applications, namely the Kingsnorth power station run by E.ON in Kent, Tilbury GreenPower's plant in Essex and ScottishPower's Longannet power station in Fife, Scotland. One UK industry source who wished to remain anonymous described the selection process as "really daft". He said: "The projects have been selected by officials in Brussels without a proper tender process."

"The UK projects were sensible choices, but we don't know how they chose the one that won," he added. "They [Brussels] reckon they have chosen the one that will be potentially ready more quickly than the others, but I'm not sure that they have the expertise to decide this. Officials in the UK government were not even consulted."

Commission energy spokesman Ferran Tarradellas said the money would be allocated according to "a very clear list of criteria" and confirmed that the current shortlist was merely the Commission's initial decision. "We have not chosen anything, just transmitted our list to member states based on our assessment," he said. "The process is not finished." Member states now have two weeks to examine the proposal before handing it to the European Parliament for approval. At the end of this process, the Commission will re-examine the candidates before putting forward the final list.