Abby L. Harvey
GHG Monitor
9/25/2015
British power producer Drax said on Friday it has withdrawn from the White Rose carbon capture and storage project. The project is currently under development by Capture Power Ltd., a consortium of Drax, Alstom, and BOC. White Rose will still be located at the Drax power plant in Yorkshire as the company has agreed to keep the site and existing infrastructure available for the future project.
“Drax still believes this project has great potential and we have announced that the site at the Drax Power Plant, along with our existing infrastructure remain available for the project to be built,” Drax Group Operations Director, and Capture Power board Director, Pete Emery said in a Drax press release.
The plant will be a fully equipped oxy-fuel combustion CCS facility and is intended to capture 90 percent of carbon dioxide emissions for transport to a storage site beneath the North Sea seabed.
Drax will maintain its involvement in the project through the completion of the Front End Engineering and Design (FEED) study now under way, but will not invest any further after the study is complete.
The FEED study must be completed for the project to remain in the U.K.’s CCS Commercialization Competition. Currently, White Rose is one of only two CCS projects in the United Kingdom eligible for the £1 billion prize. The other remaining project, Peterhead, is located in Aberdeenshire, Scotland, and is also completing a FEED study. Two reserve bidders in the competition could take White Rose’s spot if the project were to be withdrawn, though at this point this has not been entertained as an option by Capture Power or Drax.
“We are now well over halfway through the FEED study and we are progressing towards receiving development consent. The final investment decision for White Rose will be dependent on successful outcomes of the FEED study, funding arrangements and the proposed Contract for Difference market mechanism designed specifically to encourage investment in new, low carbon generation,” Leigh Hackett, CEO of Capture Power, said in a company press release.
The decision to leave the White Rose project should not be seen as a reflection of Drax’s opinion on the viability of the effort, Emery said. “We are confident the technology we have developed has real potential, but have reluctantly taken a decision not to invest any further in the development of this project. The decision is based purely on a drastically different financial and regulatory environment and we must put the interests of the business and our shareholders first,” he said.
“Drax’s decision not to invest further in the Project is disappointing, but we are keen to confirm that Capture Power remains committed to delivering the White Rose CCS Project,” Hackett said.
White Rose has shown a great deal of promise in recent years, moving to the final round of the CCS commercialization competition and also receiving funding from the European Commission’s New Entrants Reserve 300 (NER300) funding plan. White Rose was the only CCS project awarded funding under the scheme, receiving €300 million in July.
