9 April 2010 – The UK government has won Parliament’s approval for the authority to levy a tax on electricity suppliers including EDF, E.ON and Centrica that will fund carbon capture and storage (CCS) projects.
According to Bloomberg, the law was one of a handful passed before Parliament prorogued ahead of the 6 May election called by Prime Minister Gordon Brown.
The UK is betting that CCS technology will help cut its greenhouse gas emissions by 80 per cent from 1990 through 2050. The government estimates that developing the technology may add £6.5bn ($10bn) a year to the economy and create 100 000 jobs in the UK by 2030.
The government is yet to decide the size of the levy will be or when it will be imposed. It will help fund as many as four commercial-scale demonstration projects for carbon capture and storage, according to the government. The levy will be paid by UK electricity suppliers including RWE Npower, Scottish and Southern Energy and Iberdrola Scottish Power.
E.ON and Scottish Power are finalists in a government competition for funding one carbon capture project. They won an unspecified amount of funding last month to research their demonstration proposals. Powerfuel Power got €180m ($248m) of European Union funding in December.