Acorn Project Carbon capture 'leading contender' for funding as UK Government say Scotland 'at heart' of plans to power up Britain

Critics have claimed the Acorn Project carbon capture scheme in Aberdeenshire has been “relegated” despite assertions from the UK Government the project is a “leading contender” for funding.

The UK Government insisted Scotland was “at the heart” of its plans to power up Britain. Acorn, at St Fergus in Aberdeenshire, missed out on the first allocation of funding in 2021, losing to two projects in the north of England around the Humber and the Mersey.

But now ministers have included it in the second list, describing it as “one of the two best placed” for funding, as the UK Government outlined its plans to boost energy independence and security.

It came as the Government released thousands of pages of documents on Thursday as part of what was billed as Green Day, only for most of the money unveiled to have already having been earmarked in the past.

Grant Shapps made a series of energy announcements on Thursday.

Despite this, the UK Government insisted new jobs and investment were set to come to Scotland as it unveiled a strategy to scale up affordable, clean, homegrown power and build green industries in Britain.

One new announcement, however, was the launch of Track-2 of the capture usage and storage (CCUS) cluster sequencing process. The move is to identify the next two CCUS clusters that will contribute to its ambition to capture 20-30 megatonnes of CO2 per year across the economy by 2030.

The Government said, at this stage, it considers the Acorn Transport and Storage System in Aberdeenshire one of the two best placed to deliver its objectives. It comes after £20 billion for CCUS was announced in the Spring Budget.

First Minister Humza Yousaf claimed the new energy strategy had “relegated” Scotland's planned carbon capture and storage project. He contrasted the approach of the Scottish Government with that of the Conservatives at Westminster, saying he had appointed a net zero and just transition secretary to “unlock our green potential”.

SNP Westminster leader Stephen Flynn claimed there was a “complete lack of credible detail” for Scotland’s Acorn project, as his party labelled the decision to reject the Aberdeen carbon capture project in an initial round of funding in 2021 as a “political choice”.

Scottish social justice secretary Shirley-Anne Somerville branded the decision not to award the Scottish cluster Track-1 status “frankly illogical”. She said while the UK Government strategy did have “some welcome announcements”, ministers had failed to “provide a clear content and a strategy to decarbonise the energy economy”.

Ms Somerville said: “While we welcome the UK finally setting out the Scottish cluster is eligible for Track-2, they have failed to provide any certainty for when that funding will be awarded. This Government will continue to support the north east and ensure we are supporting our highly skilled workforce. It is disappointing that the UK Government has once again failed to do so.”

Government sources insisted the move showed clear intent to move forward, and the SNP were the ones scoring political points. A UK Government source said: "What today has shown is all the SNP scaremongering was exactly that – scaremongering."

UK Government minister for Scotland John Lamont said: "I am delighted that the UK Government has launched Track-2 of the CCUS cluster sequencing process, and the Acorn Transport and Storage System in Aberdeenshire has been confirmed as one of the two best-placed to deliver this.

"The carbon capture sector is a priority for the UK Government and we are progressing at pace and investing up to £20 billion over the next 20 years to help decarbonise our industries."

Scotland Office minister Mr Lamont said Scotland’s green energy potential was “at the heart” of the UK Government’s plans to deliver energy security, drive investment and grow the economy by developing clean domestic power sources.

He said: “From the carbon capture sector, where we are progressing at pace and investing up to £20bn to help decarbonise our industries, to offshore wind, funding for low-carbon hydrogen projects and making the Contracts for Difference round an annual event, Scotland is a key part of the UK’s net zero plans and helping to boost economic growth through green jobs.”

The UK Government has set an ambition for 10GW of hydrogen production by 2030 and said Scotland would be central to those plans.

Four of the first 15 projects to be given a share of the £240 million Net Zero Hydrogen Fund (NZHF) to develop new low carbon hydrogen production plants are in Scotland, it was announced on Thursday.

UK energy security and net zero minister Graham Stuart said: “Scotland will be at the heart of our plans to power up Britain as we support its development of new homegrown technologies of the future. Today’s announcement will create opportunities for Scottish businesses to export their expertise around the world and set the standard for a clean, secure and prosperous future.”

Scotland’s winning NZHF projects are Statera, based in Kintore, which plans to develop a 3GW, grid-connected, electrolytic hydrogen project that aims to use excess wind power in Scotland to produce low-carbon, green hydrogen and supply it to the UK’s most carbon intensive industrial clusters through existing gas transmission pipelines.

Meanwhile, Octopus Energy’s Lanarkshire Green Hydrogen project plans to deploy 15MW of electrolysis directly connected to an onshore wind farm to produce more than 3.5 tonnes per day of green hydrogen.

The other winning projects are Falck Renewables, which plans to develop its Knockshinnoch Green Hydrogen Hub Project, and Getech, which aims to build a major green hydrogen hub in Inverness that will produce, store and dispense green hydrogen – upwards of ten tonnes a day over time.

Energy security secretary Grant Shapps has also launched a £160m fund for projects to build the port infrastructure needed to support further floating offshore wind power. It came as the UK Government refused to commit to stopping the development of the Rosebank oil and gas field north of the Shetland Islands.

It is the largest such field in the North Sea area, capable of producing 69,000 barrels of oil and 44 million cubic feet of gas per day.

When asked by Labour’s Richard Burgon whether the Conservatives would use their powers to halt development, climate change minister Graham Stuart insisted fossil fuels would still be required for decades to come and that it was better to produce gas on the UK Continental Shelf than import it from other countries.

Critics of the Rosebank development have said Equinor, a Norwegian oil giant, is under no obligation to sell its oil and gas to the UK and will do so to the highest bidder.