Analysis by the global insight business for renewables, energy and natural resources has stressed that many companies have not been able to progress their carbon capture, usage and storage (CCUS) projects due to a slowdown in the negotiations for government funding.
The difficulty in securing public and private investment would make it very difficult for the UK to meet its 2030 CCUS targets, Wood Mackenzie said.
"CCUS is a rising global industry," said Mhairidh Evans, head of CCUS research speaking at Offshore Europe taking place in Aberdeen. "There will of course be hurdles along the way, but companies should be ready to ride the megatrend. Mostly, the technical workstreams are running ahead of the commercial and regulatory ones. And there's still a lot to do to bring emitters onboard."
The organisation stressed the need to accelerate funding processes and seek private investment to meet current CCUS targets.
Wood Mackenzie estimated that delivering the first four CCUS clusters will cost £65bn and will capture and store more than 500 million tonnes of CO₂ over their respective operational life cycles.
The government has pledged £20bn towards CCUS initiatives, which is considered "critical in unlocking the remainder of private investment".
The UK's CCUS activities are expected to take place in four transport and storage hubs, located in East Coast Cluster, HyNet, Acorn and Viking. However, none of these projects have taken final investment decisions.
Overall, some 60 different emitting facilities have announced an intention to apply CCUS technologies before 2030, ranging from large-scale power-generating facilities to cement production and small biofuel facilities. Out of these, only eight projects have been selected to receive funding.
"The UK's CCUS targets are among the most ambitious in the world," Evans said. "Delivering them was always going to be a big ask. High ambitions are needed, and a missed target shouldn't necessarily be viewed as a failure.
"This is about building technology and infrastructure to reduce industrial emissions for decades to come. Ultimately, the UK has all the right ingredients and is going in the right direction. We just need to go a bit faster."
In the UK alone, the carbon capture and storage (CCS) sector could be worth £100bn to the economy by 2050, according to an Offshore Energies UK (OEUK) report. The UK government's official Net Zero Strategy estimates that around 50 million tonnes a year will need to be captured by 2035.
However, another study from researchers at Imperial College London recently found that governments routinely overestimate the amount of carbon that has been sequestered from carbon capture efforts by 19-30 per cent. They argue that requiring facilities to report actual capture rates would tell us more precisely how well CCS is working and put us in a much better position to address the climate crisis.
In May, 12 companies received 20 licences in the UK's first-ever carbon dioxide storage licensing round. The licences cover an area of around 12,000 square kilometres in size, located near Aberdeen, Teesside, Liverpool and Lincolnshire.
In May, 12 companies received 20 licences in the UK's first-ever carbon dioxide storage licensing round. The licences cover an area of around 12,000 square kilometres in size, located near Aberdeen, Teesside, Liverpool and Lincolnshire.
