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Eon drops out of carbon capture and storage race

Energy giant Eon has announced it is pulling out of the competition to build the UK’s first power station fitted with technology to capture and permanently store carbon emissions.

Eon’s Kingsnorth plant in Kent was one of two schemes shortlisted in the government competition for funding worth potentially more than £1bn to install the technology as part of its new coal-fired power station.

But the energy company today said the market was not conducive to building a new 1,600MW power station at the site, and as a result it would not proceed to the next stage of the carbon capture and storage (CCS) competition.

The announcement came ahead of today’s Comprehensive Spending Review, which revealed that the government will invest up to £1bn to trial the technology.

Carbon capture and storage has not been developed at scale, but there are hopes the technology could slash emissions from power stations by up to 90% – and the coalition government has said it forms part of plans to drive the UK towards a low-carbon energy system.

The previous government said no new coal-fired power stations would get the go-ahead without CCS to tackle a proportion of their emissions.

Two potential schemes had been competing for the funding, with ScottishPower’s site at Longannet, Scotland, the other power station in the running.

Both had been awarded initial funding to develop their plans.

Paul Golby, chief executive of Eon UK, said: “Having postponed Kingsnorth last year, it has become clear that the economic conditions are still not right for us to progress the project and so, simply put, we have no power station on which to build a CCS demonstration.

“We therefore took the decision to withdraw from the Government’s competition because we cannot proceed within the competition timescales.”

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