The government’s desire for a ‘green economy’ has become such an obsession that it has begun to override common sense. This week, the Department for Energy and Climate Change invited bidders to apply for £1 billion of public funding for a commercial-scale carbon capture and storage project. The money will be used, we are told, to extract carbon dioxide from the chimneys of a large power station, condense it and pump it 150 miles out into the North Sea to be buried in the chambers of an empty oil well.
The department justifies this expenditure by claiming that by the next decade carbon capture will be an industry worth £6.5 billion a year to Britain. It is a preposterous figure, quoted by officials without any suggestion as to how it was arrived at.
If anyone outside government really believed that carbon capture was a viable business proposition there would be plenty of private investors wanting to risk their money on it. But there is scant sign of that. There are already more than 50 demonstration projects in action around the world, some dating back to the mid-1990s. And they all have one thing in common: they have been established thanks to big government handouts.
If the idea of a £1 billion subsidy for a carbon capture project sparks a sense of déjà vu in any readers, it is not without reason. In 2007, the then Labour government launched a similar competition, estimating that it would cost between £500 million and £700 million to set up a carbon capture plant. By 2010, when George Osborne increased the public money available to £1 billion in his comprehensive spending review, the original nine bidders had been reduced to one: Scottish Power, which proposed to fit the technology to its existing Longannet power station on the Firth of Forth.