Certificates for CCS at reduced public cost: securing the UK's energy and climate future, Energy Bill 2015

Abstract

This Paper concerns the Energy Bill, which starts its Committee stages in the Lords on Monday 7th September and Wednesday 9th September 2015. The Bill is mainly tasked to create the OGA (Oil and Gas Authority). In addition the Bill creates responsibilities for the OGA regarding Carbon Capture and Storage (CCS) licensing. Most importantly, the Bill raises the opportunity for a discussion of how the envisaged development of CCS will be paid for. At present, the funding model involves significant taxpayer support through the CCS competition and levy control framework on electricity. We make a simple proposal that would remove this burden of Government support, and spread the cost of CCS development and deployment across the entire fossil fuel sector through a Certificate scheme that would rely only on data already reported to Government and the OGA, thus minimising the costs of compliance.