Net Zero Teesside Project Moves Step Closer Following £52Million Funding Boost

Business & Invest | Published on: 17th March 2021

  • Net Zero Teesside and partners have been awarded £52million to deliver UK’s first decarbonised industrial cluster
  • The funding will accelerate development of carbon capture, utilisation and storage and hydrogen infrastructure
  • Net Zero Teesside will develop a new gas-fired power station with carbon capture to reduce emissions in the area

The Net Zero Teesside carbon capture, utilisation and storage project has been awarded more than £52million in funding today (17 March) to accelerate the development of onshore and offshore low-carbon and hydrogen infrastructure.

The fund will be used to deliver the next stage in planning of a flexible gas-fired power station with carbon capture, utilisation and storage capabilities on the Teesworks site.

Net Zero Teesside, a consortium of the world’s largest oil companies led by BP, has partnered with Zero Carbon Humber, a similar project, to form the Northern Endurance Partnership. This is a development of an offshore pipeline network which will see captured carbon dioxide emissions from both Net Zero Teesside and Zero Carbon Humber transported and permanently stored deep underground.

Net Zero Teesside aims to be up and running within the next five years and, when complete, it could create 5,500 direct jobs during its construction and add £450million to the economy each year. The scheme plans to capture up to 10million tonnes of COemissions each year, equivalent to the emissions associated with the annual energy use of up to three million UK homes.

The news comes just days after it was announced in the Spring Budget that Teesworks would become the UK’s largest Freeport following a successful bid led by Tees Valley Mayor Ben Houchen.

Mayor Houchen said: “The Net Zero Teesside project is the first of its kind anywhere in the world and is a key part of my plan for jobs, a plan that is delivering good-quality, well paid jobs for local people. Along with our research and innovation in hydrogen and the recently announced GE Renewables Energy facility also coming to Teesworks, our region is now the go to place for clean energy.

“This latest funding boost shows the confidence in, and commitment to, this project which will play a huge part in delivering the Governments ambitions for the UK to be the first net zero country in the world.

“This project could have gone anywhere in the world, but came here because we have the skill, expertise, workforce and site to make it a reality. With the recent announcement that we will be home to the UK’s largest Freeport, this will only encourage more businesses in the clean energy sector to invest and regenerate our site and wider region.”

Cllr Mary Lanigan, leader of Redcar and Cleveland Borough Council, said: ““This shows how we can be world-beaters right here in the Tees Valley, by helping deliver a cutting edge project which will deliver thousands of high quality jobs and also a have lasting positive impact on our environment. There’s still a long way to go but we will continue to work with all our partners, including industrial leaders from around the world, until this huge project becomes a reality which will boost our economy for generations.”

The investment has been made as part of the Government’s Industrial Decarbonisation Challenge, funded as part of the ISCF, its flagship challenge-led innovation programme, run through the BEIS-sponsored UK Research and Innovation.

Business and Energy Secretary Kwasi Kwarteng said: “We were the first major economy to put into law our target to end our contribution to climate change, and today we’re taking steps to be the first major economy to have its own low-carbon industrial sector.

“While reaching our climate targets will require extensive change across our economy, we must do so in a way that protects jobs, creates new industries and attracts inward investment – without pushing emissions and business abroad.

“Ahead of COP26, the UK is showing the world how we can cut emissions, create jobs and unleash private investment and economic growth. Today’s strategy builds on this winning formula as we transition low carbon and renewable energy sources, while supporting the competitiveness of Britain’s industrial base.”

Andy Lane, Managing Director, NEP and NZT, said: “I am pleased to welcome the Phase 2 funding the projects have received through the ISCF, which will help to accelerate key elements of onshore and offshore CCUS infrastructure on the east coast of England. This support for CCUS in the UK is critical to enabling projects such as NEP, NZT and ZCH to enter Front-End Engineering Design (FEED), a crucial step forward as we look to develop the world’s first decarbonised industrial cluster by 2030.

“Public funding demonstrates Government commitment and increased ambition to establish the CCUS industry outlined in the recent Ten Point Plan and, along with clear Government policy, which is currently being developed, will unlock significant further investment from the private sector.”

Grete Tveit, Senior Vice President for Low Carbon Solutions at Equinor, which is a partner in ZCH, NZT and NEP, said: “These awards are great news for the UK. The Humber and Teesside make up nearly half of UK’s industrial emissions so, to reach net zero, there is enormous value in tackling emissions at both clusters together. Rolling out carbon capture use & storage and hydrogen across the UK’s industrial clusters supports the Government’s aims for a green recovery and to level up by safeguarding and creating many high-skilled jobs, and will establish the UK as a world leader in hydrogen and low carbon technologies. As the UK’s leading energy provider, we will continue to work with our partners to progress our projects to final investment decision, engage locally and nationally to make this happen.”

Martin Cook, Senior Vice President for Business Development for National Grid Ventures, a partner in ZCH and NEP, said: “These awards represent an important milestone as we look to decarbonise the UK’s largest industrial heartland and build a globally competitive platform for economic growth in the North of England.

“Teesside and the Humber offer the potential for a unique mix of technologies and scale to achieve net zero, delivering significant value for money. National Grid will use our knowledge and experience of gas and electricity transmission infrastructure, and our capabilities developed on previous CCS projects, to deliver the infrastructure required to enable industry to achieve deep decarbonisation.”

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