Government pledges nearly £22bn for carbon capture projects

Last year the Conservative government announced £20bn plans for carbon capture, but Labour said it had never committed any cash.

In her strongest indication yet of a significant increase to levels of state investment, the chancellor said contracts such as this were never signed by the previous government because it did not prioritise capital investment – which is money spent on items such as buildings, equipment, and IT.

Reeves added: “This game-changing technology will bring 4,000 good jobs and billions of private investment into communities across Merseyside and Teesside, igniting growth in these industrial heartlands and powering up the rest of the country.”

Emma Pinchbeck, chief executive of Energy UK, described carbon capture, utilisation and storage as a “tool in our armoury of technologies which we need to decarbonise parts of energy that we currently can’t do with clean electricity”.

James Richardson, acting chief executive of the Climate Change Committee, said: “It’s fantastic to see funding coming through for these big projects.”

However Greenpeace UK’s policy director, Doug Parr called for spending instead on offshore wind or nationwide home insulation.

He said £22bn was “a lot of money to… extend the life of planet-heating oil and gas production.”

Meanwhile Friends of the Earth says the government should be spending the money insulating people’s homes, not on a technology it says will just extend the lifespan of the fossil fuel industry.

The Merseyside and Teesside projects are part of several announced in 2023 to capture and store 20-30 million tonnes of CO2 a year by 2030.