UK Energy Secretary Ed Miliband has confirmed £200 million ($270 million) in government funding for the Acorn Carbon Capture and Storage (CCS) project at the St Fergus gas terminal in Aberdeenshire.
Miliband, who visited the site, said he expects the project developers to make a final investment decision before the end of the current parliamentary term. While he wants to see real progress by 2030, he stopped short of committing to a strict timeline.
The funding forms part of the UK’s wider spending review, which also increases the Scottish government’s annual budget by £2.9 billion ($3.9 billion). Miliband also stated that a Scottish Labour government would pursue new nuclear energy in Scotland.
Acorn claims the project will help retain around 18,000 jobs, particularly in areas like Grangemouth.
Captured CO2 will be transported via pipelines to storage under the North Sea. The project also supports the development of low-carbon energy infrastructure.
Similar funding is being allocated to the Viking CCS project in the Humber. Together, Acorn and Viking could prevent up to 18 million metric tons of CO2 emissions each year.
Tim Stedman, CEO of Storegga, which leads the Acorn project, called the funding a key milestone and said it complements private investment already in place.
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“We look forward to working with government in the months ahead to understand the details of today’s commitment, and to ensure the policy, regulatory and funding frameworks are in place to build and grow a world-leading UK CCS sector,” he added.
Dr Liz Cameron of the Scottish Chambers of Commerce hailed the investment as a boost to regional industry, estimating 15,000 construction jobs and major private investment.
However, Friends of the Earth Scotland criticized the move, calling it a public handout to oil and gas companies. Campaigner Caroline Rance argued CCS has a poor track record and prolongs reliance on fossil fuels. She urged investment in sustainable alternatives like public transport, home insulation, and green jobs instead.
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