Ed Miliband plans clean coal scheme worth millions

• Energy minister hopes to defuse global warming row • Cabinet support for plan, but Treasury balks at cost

Juliette Jowit and Tim Webb
The Guardian, Saturday 18 April 2009

Ed Miliband, the climate change and energy secretary, is pushing an ambitious plan to spend billions of pounds on cleaning up pollution from dirty coal plants.
He is said to have cabinet support for the proposal which could help to head off controversy about global warming pollution and the UK's future energy security.
Ministers are still discussing how to fund the expensive and unproven carbon capture and storage technology, including a possible levy on customer bills.
Miliband is said to favour developing "clusters" of carbon capture and storage (CCS), fitted on both coal- and gas-fired power stations, and a "national grid" for transporting and storing the polluting emissions. Such a move would be a change from the current policy of building up to eight coal plants, with only one equipped with pollution-trapping technology.
However, Treasury officials have balked at the cost and a less ambitious plan, starting with two or three plants, is also on the table.
It had been hoped the proposals could be announced alongside next week's budget, but the announcement might have to be delayed until financing is agreed.
Ministers have already delayed announcing permission for the first proposed new coal plant, at Kingsnorth, Kent, because of wrangling over the cost of CCS, said to have risen to between £750m and £1.5bn for the first trial alone.
Energy companies have warned that further delay in decisions on new coal power would pose serious security of supply problems as other ageing plants are closed down.
Greenpeace urged the government to go further. John Sauven, its executive director, said: "Climate scientists have made it clear that any outcome which results in a jumble of half measures would be another Heathrow-sized fiasco.
"Miliband should be focused on cutting emissions, not appeasing German energy giants like E.ON who want to build a new coal-fired power station at Kingsnorth without guaranteeing it will capture and store any of its emissions."
A consultation on the proposals is expected to include how to fund more demonstration coal plants to test the technology, which is not yet commercially proved. Senior officials are also understood to be concerned about the long-term cost and responsibility for storing huge quantities of carbon dioxide and other global warming emissions.
Energy companies will also be required to fit CCS to their coal plants over a period of time once the technology is proved. Companies not able to secure European commission funding will pass on the costs of the CCS programme to consumers.
Supporters of a levy said it would be spread over millions of homes and businesses across several decades, but fuel poverty campaigners say 6m householders are already struggling to pay for gas and electricity.
Until now the government has offered to fund one CCS demonstration plant but has not said how much money would be made available or how. The Treasury is not in a position to commit significant funds to an expanded programme. The Department for Energy and Climate Change (DECC) said: "We have to strike the right balance between affordability and getting the level of demonstration we want."
Miliband is said to have asked officials to draw up a new coal plan to meet conflicting warnings about global warming emissions and a looming gap in Britain's energy supplies when old coal and nuclear plants are closed in the next decade.
The Climate Change Committee watchdog has said the UK should make coal plants fit CCS by the early 2020s to meet the government's pledge to cut greenhouse gases by 80% by 2050.
The DECC believes clusters of coal and gas plants with CCS would offer efficiency because they could share the costs of building and operating pipelines to storage facilities, probably in old North Sea oil and gas fields.