London, UK, 28 November 2023 – A new report from Westwood Global Energy Group (Westwood) reveals that while the UK has potential to far exceed its carbon capture and storage (CCS) targets, delays, cancellations and under-delivery still pose significant risk. Following the UK’s first Carbon Storage Licensing Round, the findings underscore the critical nature of setbacks in government funding, congested licence work programmes, and challenges in securing access to CO2.
Westwood analysis highlights that, based on current reported project schedules, the UK is on track to exceed its upcoming carbon storage targets. By 2030, there is potential for up to seven carbon storage sites with capacity for over 45 million tonnes per annum (MTPA), double the lower end of its target. Encouragingly, the research uncovers that the UK is also well-placed against its 2035 ambitions and could look to reach over double its 50 MTPA target.
However, Westwood assesses the implications of potential setbacks on the existing carbon storage project pipeline, unveiling that even minor delays will mean the UK misses its 2030 targets. By modelling a scenario where Track-1 clusters maintain phase 1 progress but have a two-year delay to subsequent phases and all other announced projects are delayed by two years (Figure 1), the research emphasises the need for timely project completion.
Stuart Leitch, New Energies Research Manager, Westwood said “While the forecast carries an optimistic outlook, project targets and reality can often differ. Delays and project under-delivery are not uncommon, and Westwood scenario analysis highlights the importance of the government’s support to ensure the prompt commissioning of projects to reach its own targets.”
Catherine Horseman-Wilson, Senior Analyst – NW Europe, Westwood continues “The industry is grappling with a series of challenges, from funding delays and congested work programmes, to access to CO2 and co-location and infrastructure re-use difficulties, so the likelihood of delays can’t be ignored. The UK has a significant opportunity, with a strong capability to surpass its targets, but contingency planning will be a crucial element in securing its full potential, particularly in ensuring the strict adherence to schedules and maintaining a reliable CO2 supply.”
Figure 1: UK Carbon Storage Project Pipeline of Announced Projects with Delay to Start-Up Modelled. Source: Westwood Atlas New Energies
*Track-1 project – No delay to phase 1, subsequent phases delayed by two years
**All other announced projects delayed by two years
The full report, with analysis from Westwood’s Atlas and Atlas New Energies solutions, covers a detailed review of each carbon storage licence awarded, company analysis and an overview of the UK CCS industry, and is available to read now.
ENDS
About Westwood Global Energy Group
Every day, organisations throughout the onshore and offshore energy value chain ask strategic, technical and commercial questions and turn to Westwood Global Energy Group for the answers. As trusted advisors to companies in key sectors, Westwood Global Energy Group chooses to focus on areas of the industry traditionally underserved by other players.
The Energy Transition means that businesses are facing both new opportunities and risks in how they operate. We are committed to helping the energy industry navigate the transition successfully, by leveraging our extensive track record in providing actionable insight and advice that businesses, industry bodies and investors have relied upon time and time again. From the depth of our data to the insight from our industry experts, our commercial advisory to our quantitative techniques and databases – we insist on excellence in everything we do.
Westwood Global Energy Group is headquartered in London and has offices in Aberdeen, Houston and Singapore.
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