Detailed guide: Funding for low carbon industry
Updated: Carbon Capture and Utilisation Demonstration (CCUD) documents added.
Innovation to reduce the carbon emissions from UK industry and driving down the cost of carbon capture, use, and storage
Across government, Innovate UK, Research Councils, and BEIS expect to invest around £162 million in industrial research and innovation, including Carbon Capture, Use and Storage (CCUS).
As part of this commitment, within the BEIS Energy Innovation Programme, BEIS expects to invest around £100 million in low carbon industrial innovation to reduce the risks and costs of accelerating the roll out of low carbon technologies which will enable UK industry to remain competitive.
Call for CCUS Innovation
On 31 July 2018 BEIS launched a £15 million Call for CCUS Innovation to offer grant funding for innovation projects that lead to:
- A significant reduction in the cost of capturing and sequestering carbon dioxide; and/or
- A quicker, more widespread deployment of CCUS in the UK and internationally;
Funding of up to £5 million will be considered for feasibility studies, industrial research or experimental development projects; and up to £7 million for research infrastructure that enables the UK to conduct world-leading research and innovation into CCUS. Project funding will be available for up to 24 months, with projects finishing by 31st March 2021.
This Call will ensure the UK remains at the forefront of CCUS innovation, developing novel technology and processes that reduce the cost of deploying CCUS and positions the UK as a world technology leader in CCUS.
Applicants must complete and submit the application forms (see below) by email to Industry.Innovation@beis.gov.uk by Sunday 11 November 2018:
In 2017 BEIS commissioned Wood to execute a study assessing the most promising CO2 capture technologies in order to inform future innovation spending programmes and to shape future policy direction for carbon capture technologies in the power and energy intensive industries. A literature review of novel capture technology was completed, and eleven techno-economic benchmarks were studied.
This benchmarking comprised eight current state-of-the-art carbon capture on power generation, two leading next generation carbon capture technologies on power generation, and one carbon capture benchmark on hydrogen production.
The literature review and benchmarking report are being published to accompany the Call for CCUS Innovation. Innovation projects that focus on reducing the cost of capturing and sequestering CO2 will be compared to the benchmarks produced by BEIS/Wood, to determine if they produce meaningful improvements against the current state-of-the-art CCUS technology, and how robust the case is for them achieving these improvements.
As part of the BEIS/Wood study a levelized cost of electricity/hydrogen calculator was produced as part of the benchmarking analysis. This calculator allows applicants to compare their technology against the benchmarks produced in the study, and for this analysis to be used in project applications for the Call.
Hydrogen Supply Competition
Low carbon hydrogen could play an important role in decarbonising industry, power, heat and transport. However, for a market to grow, potential users (in any application) need to be confident in supply of sufficient amounts of low carbon hydrogen at a competitive price.
The £20 million Hydrogen Supply programme aims to accelerate the development of low carbon bulk hydrogen supply solutions in the above sectors. It is aimed at projects at a technology readiness level (TRL) of 4 to 7, which could result in lower capital or operating costs when compared to Steam Methane Reformer with Carbon Capture & Storage (SMR+CCS), or improve the capture rates at a comparable cost.
The programme is now live. If you are interested in applying, please see the guidance, application and finance forms below.
The deadline to register your interest is 21 November 2018.
The deadline to submit proposals is 5 December 2018.
Industrial Energy Efficiency Accelerator
To support innovation in energy efficient technologies, the government will be investing up to £9.2 million for an Industrial Energy Efficiency Accelerator, to be delivered over the next 4 years.
This Accelerator will seek industry-specific solutions which are close to commercialisation by leveraging private sector investment and strengthening UK supply chains to reduce energy costs for UK industry. After a competitive process, the Carbon Trust has been awarded the contract to help BEIS deliver this programme. The Carbon Trust has been holding events to engage with both industry and their suppliers, and the competition is now open to applications.
We have recently committed £560,000 to 2 successful projects in the first round of the Industrial Energy Efficiency Accelerator (IEEA). The IEEA aims to broaden the range of technologies available for industrial energy efficiency, bringing down the cost for decarbonisation. More information on the companies that have successfully bid for these projects will appear shortly.
Further information is also available from the Carbon Trust
Industrial fuel switching to low carbon alternatives
The Clean Growth Strategy highlights the need for industry to begin to switch from fossil fuel use to low carbon fuels such as biomass, hydrogen and clean electricity. Beyond 2030, the switch to low carbon fuels for industry will need to substantially increase in scale. Government has launched the first phase of an innovation competition which has been allocated up to £20 million which focuses on market engagement and potential scope for fuel switching in industry. The competition aims to stimulate early investment in fuel switching processes and technologies, so that a range of technologies are available by 2030 and beyond.
Element Energy successfully bid for the first phase which aims to understand the potential for industry to operate on low carbon fuels and the innovation required to enable this to happen, a report detailing Element Energy’s findings will be published in the autumn.
Carbon Capture and Utilisation Demonstration (CCUD)
As part of the government’s Clean Growth Strategy BEIS has allocated up to £20 million to design and construct carbon capture and utilisation (CCU) demonstration projects. This programme is designed to encourage industrial sites to capture carbon dioxide which could then be used in industrial applications, while enabling learning and development of capture technologies at an intermediate scale, so reducing costs and risks.
The overall aims of the CCU demonstration programme are:
- to demonstrate carbon capture and utilisation at a number of key industrial sites in the UK
- to demonstrate and accelerate cost reductions in carbon capture technology in the order of 20 to 45%, i.e. £10-20/MWh
- to encourage a project pipeline of follow-on CCU projects that will help less mature, but more novel technology to be demonstrated at scale; and
- to improve understanding of the cost and performance of carbon capture technology
- to de-risk the capture technology.
The programme is in 3 phases:
- Phase 1 focuses on initial scoping study for an engineering supplier to work on BEIS’ behalf with potential host sites, carbon dioxide users and technology suppliers to produce site-specific cost estimates for deploying CCU at UK industrial sites. Wood.Plc successfully bid for Phase 1
- Phase 2 will fund projects to conduct design studies for constructing CCU equipment at UK host sites
- Phase 3 will fund projects to construct and demonstrate CCU
Phase 2 of CCUD: Programme Advert
Phase 2 of CCUD: Front End Engineering Design (FEED) Studies
A £5 million Call for the Phase 2 Front End Engineering Design (FEED) Studies, part of the £20 million CCUD Innovation programme, provides grant funding for up to 5 FEED studies. These will produce cost estimates for the construction and operation of demonstrating CCU at the host site. The cost estimates are anticipated to produce cost accuracy of ±15% to allow BEIS and the developer to make a final investment decision.
The Call is open to all sizes of organisation and will provide grant funding for projects of 6-9 months, finishing before October 2019. The projects can involve working with international partners, but the work funded must be predominantly conducted in the UK.
BEIS will fund project proposals that meet the definition of Feasibility Study. Grants of up to £1 million will be considered under Article 25.
2 reports on carbon dioxide utilisation that were prepared by Ecofys and the Royal Society are also available.
ERA-NET Cofund – Accelerating CCS Technologies (ACT)
In 2016 the UK joined a consortium of nine European countries to co-fund collaborative innovation projects into CCUS called Accelerating CCS Technologies (ACT). ACT is a European Research Area Network (ERA-NET) Cofund, which is a tool established by the European Commission under the Horizon 2020 programme for research and innovation. The idea behind ERA-NET Cofunds is that European countries should join forces when it comes to funding RD&D and innovation on subjects of high European interest.
Under the scheme, 9 European countries – Germany, Greece, the Netherlands, Norway, Romania, Spain, Switzerland, Turkey, and the UK – have come together to provide €25.34 million to support collaborative projects that can accelerate the deployment of CCUS within Europe; the European Commission adding a further €11.26 million, giving a total pot of €36.6 million.
Within the €36.6 million BEIS has committed £4.4 million, matched with a further £2.2 million in co-funding from the European Commission, to support UK participation in 5 collaborative projects with European partners.
Of the 8 projects selected in May 2017 the UK is contributing to 5:
ACORN: aims to initiate a low cost full chain carbon capture and storage project in North East Scotland that is readily scalable to nationally significant CO2 infrastructure
ALIGN: a large scale project aiming to accelerate the demonstration and implementation of European CCUS projects by addressing specific R&D gaps across the CCUS chain, including capture, transportation, storage and utilisation
DETECT: aims to provide pragmatic and reliable tools to reduce risks and costs for CO2 storage operations
ELEGANCY: aims to fast-track the decarbonisation of Europe’s energy system by exploiting the synergies between two key low-carbon technologies: CCS and hydrogen
PRE-ACT: an industry-driven research project with a strong focus on improving strategies for monitoring and management of pore pressure distribution to address the main storage-related challenges for the deployment of CCS: capacity, confidence and cost.
Contact
Please direct any other questions to industry.innovation@beis.gov.uk.