The managing director of an energy giant behind huge Net Zero plans for the Humber has told it could be now or never for policy to enable vital delivery.
Catherine Raw heads up SSE Thermal, the company delivering the Keadby power cluster in North Lincolnshire - which now encompasses carbon capture and hydrogen proposals - as well as plans for the clean fuel storage and production in East Yorkshire.
In a considered statement shared with Business Live following the release of the Skidmore report, Mission Zero, she said: “We may be only a handful of days into the new year but time is already running short. For the UK to deliver on its net zero ambition, the next 12 months can either pave the way for crucial final investment decisions to be made in 2024 or result in that capital moving elsewhere. It means real and tangible progress – on passing necessary enabling legislation, providing clarity on business models for the infrastructure required to deliver and turning high level targets into defined policy – is not simply a desired outcome but an essential one.
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“It is the only way developers and investors can have the confidence to give vital decarbonisation projects the go ahead. For developers of carbon capture and storage projects, we need the UK Government to be clear on its ambition for this technology.
“The price of inaction is high. We know the future we want to arrive at – it is one powered, in the main, by offshore wind and backed up by flexible and dispatchable power that is low-carbon in its own right. It’s a future in which security of supply is assured and energy is affordable. Failure risks carbon lock-in for another generation, with decisions on extending the life of existing unabated assets and the addition of new unabated capacity looming.”
A key voice in a growing chorus pushing for decisive action, she has focused in on the Keadby Three project, which involves carbon capture. SSE has just delivered KeadbyTwo - a highly efficient gas-fired generator, with the third plant planned for just west of Scunthorpe to have emissions abated. It has also acquired Saltend Power Station with Equinor, its hydrogen partner.
“Industry is pushing hard to make progress,” she said, with an understanding next steps could emerge next month. “Within SSE Thermal, we are developing several low-carbon options with a focus on carbon capture and hydrogen. Just last month, we secured planning permission at our Keadby Three Carbon Capture Power Station – making it the first power CCS project in the UK to gain a development consent order. But this is just one part of the puzzle. While progress has been made in the UK Government’s cluster sequencing process, we await a decision on the allocation of the first dispatchable power agreements and whether Keadby Three will be one of the projects chosen. And perhaps more importantly, we have no line of sight on what the government’s ambition is for power CCS beyond ‘at least one’ power CCS unit by mid-decade.”
Ms Raw said power CCS offers many advantages when it comes to decarbonising the electricity system, with a step up in deployment to between 7GW and 9GW, twinned with a 50GW offshore wind ambition, saving an additional 18 million tonnes of CO2 between 2030 and 2040 by limiting carbon emissions during periods when the sun isn’t shining and the wind isn’t blowing.
"That isn’t to say power CCS is the entire solution, but under current plans its potential contribution to the future energy system simply isn’t being fully realised. That’s why greater ambition and action is needed, especially as it would give developers the confidence to bring forward these projects for delivery by 2030," she said, reiterating a message “made clear” to the BEIS Select Committee late last year.
Ms Raw said it would also underpin development of a hydrogen economy, with a first-ever UK Hydrogen Week taking place next month, and the Humber held at the forefront. “At SSE Thermal we are taking the bull by its horns and progressing a unique project,” she said. “The Aldbrough Hydrogen Pathfinder would unite hydrogen production, storage and power generation in one location by the middle of this decade and support the evidence base for wider deployment of flexible hydrogen power.
“Fundamentally, the project aims to prove the integral role hydrogen can play in the UK’s net zero journey. It forms a key element of our wider plans to decarbonise the Humber – the UK’s most carbon-intensive industrial cluster – and we believe it will clearly showcase how electrolytic hydrogen can provide home-grown security of supply while adding vital flexibility to our electricity system.
“SSE Thermal is incredibly well placed for delivery, not only of this project but of the many other low-carbon developments we are aiming to bring forward across the UK. Company-wide, SSE is investing more than we earn in profits and we believe alongside renewables, both power CCS and hydrogen are crucial technologies to bring the UK to net zero.
“But the clock is now ticking. By our own estimates, if the system investment required to meet 2030 targets had been delivered by 2022, around £30 billion would have been saved in GB expenditure on gas last year. That underlines the cost of delay and inaction. So, let’s ensure that we aren’t left ruing what might have been as the clock strikes midnight at the end of 2023. Instead, let’s make the decisions today so we can all feel the benefit tomorrow.”
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