July 5 (Bloomberg) -- A European Union program to fund as many as 12 carbon capture projects attracted only one bid for the emissions-trapping technology, a proposal submitted by a venture between Drax Group Plc, Alstom SA and BOC Group Ltd.
The White Rose project applied under the second phase of the European Commission’s NER300 program, said an official for the Capture Power Ltd. venture who asked not to be identified. It was the sole carbon-capture plan, the EC said on its website.
The failure of the program, which also finances renewable energy, to lure more bids for the technology undermines European plans to cut emissions by building a commercial carbon capture and storage industry by the 2020s. Trapping emissions from power plants and industry would allow countries to keep burning fossil fuels and operating factories that have driven economic growth.
“One is completely insufficient and we have to find new ways of taking CCS forward,” Chris Davies, a member of the EU Parliament’s Environment and Public Health Committee who introduced the NER300 concept, said by phone. “I suspect it means that there’ll be massive concentration on making sure this project qualifies. It would just be embarrassing for everyone if there wasn’t any CCS project to show for all the work.”
NER300 sought to finance CCS and renewable energy projects from the sale of 300 million emissions allowances. The second phase will be funded from 100 million allowances and about 288 million euros ($370 million) of unused funds from the first, which failed to finance any carbon-capture proposals.
Member states had until July 3 to submit applications and a total of 32 renewables projects applied in the second tranche.
The U.K. has a separate 1 billion-pound ($1.5 billion) funding plan for CCS and in March selected White Rose and a project in Scotland by Royal Dutch Shell Plc and SSE Plc to trap emissions from a gas-power plant as preferred bidders.
The Department of Energy and Climate Change said on its website that it would only put forward CCS projects for the European program that would qualify for its own initiative.
Shell’s Peterhead project in Aberdeenshire didn’t plan to seek NER300 funding, a company spokeswoman said. Shell will work with the DECC on the venture under the U.K. program, she said.
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