UK spending on ‘fairytale’ carbon capture tech is a national embarrassment, chancellor told

Campaigners are calling on the chancellor to cut the government’s £24bn spending plans for “fairytale” carbon capture technologies in favour of funding green schemes that can reliably cut emissions and lower energy bills.

The environmentalist Chris Packham is leading an 11th-hour appeal for the Treasury to use this week’s budget to scale back the government’s “exorbitantly expensive” support for carbon capture, which is now more than the planned spending for the US, the EU, Norway and Japan combined.

He said it was a “national embarrassment” that the government had earmarked £24bn to support a series of carbon capture and storage (CCS) projects developed by big oil companies, including BP and the Norwegian state oil company Equinor, and urged ministers to “put things right”.

“CCS is a tech fairytale,” the naturalist and broadcaster said. “It should be a national embarrassment that the UK is pumping more taxpayer money into it than any other country in the world. This budget is a chance to put things right.”

The intervention comes as the government reportedly plans to reduce the grants available to households hoping to swap their gas boiler for an electric heat pump. This shift is considered crucial to cutting the carbon emitted when heating buildings, which makes up around a fifth of the UK’s total greenhouse gas emissions.

Packham called on the government to safeguard funding promises “that empower households to lower bills” rather than “bankrolling exorbitantly expensive projects with ludicrously uncertain results”.

The leaders of many economies have backed carbon capture technology designed to trap the emissions from fossil fuel infrastructure before they are released into the atmosphere. Proponents believe that piping carbon dioxide into underground storage could provide a permanent climate solution for industries that are unable to replace fossil fuels with cleaner alternatives.

Although there are instances where the technology has worked successfully, many high-cost projects have struggled to progress and there are many examples where carbon savings have proved to be far less than expected. Green groups fear the technology has been promoted by fossil fuel companies to prolong the use of fossil fuels.

Packham said a failure to rein in the planned CCS spending “would be yet another strong signal that this government is putting big oil above people and the planet”.

Aled Dilwyn Fisher, a senior researcher at Oil Change International, said: “It’s worrying that spending on climate is being cut in favour of defence, but cutting support for proven climate solutions while continuing to bankroll unreliable carbon capture projects would add insult to injury.

“This budget should be an opportunity to put public money where it can make a real difference to the climate and help cut people’s energy bills, rather than continuing to gamble billions on the fossil fuel industry’s latest expansion plan.”

Work on the UK’s first CCS projects has begun at the East Coast Cluster near Teesside and Humberside, in north-east England, and at the HyNet Cluster near Merseyside and north Wales, in north-west England.

The second phase of the government’s CCS support plan includes £200m to support the Acorn project in Aberdeenshire, alongside £80m from the Scottish government.

Rosie Hampton, a campaigner at Friends of the Earth Scotland, said over the summer that the government’s climate response was being built on “fantasy plans about turning the North Sea into Europe’s carbon dumping ground” while politicians should be focused on “climate solutions that will improve people’s lives, such as warm homes, better public transport and decent green jobs”.

Martin McCluskey, the parliamentary undersecretary at the Department for Energy Security and Net Zero, told an industry event this month that the government remained committed to carbon capture but fiscal pressures may require decisions on the pace of the industry’s development.

The Carbon Capture and Storage Association (CCSA) said the UK’s first projects had already awarded more than £4bn in supply-chain contracts, which could support about 350 UK companies and 5,500 construction jobs.

“Pulling back now would undermine investor confidence, risk leaving infrastructure underused and deepen industrial decline,” said Mark Sommerfeld, the CCSA’s UK director.

“This budget must honour existing commitments, turning today’s progress into lasting growth, energy security and reindustrialisation,” he said.