One of the key players in plans to base a pioneering green energy centre in the north-east has insisted the scheme remains on track despite doubts about a £1billion funding pot.
MPs raised fears this week that a project to develop carbon capture and storage (CCS) technology at Peterhead Power Station was in “jeopardy”.
The concerns followed an announcement by Chief Secretary to the Treasury Danny Alexander that the bulk of the UK Government’s £1billion fund for CCS could be spent on other developments as it would not be needed during this parliament.
Scottish and Southern Energy, which is working with offshore giant Shell on the Peterhead scheme, offered reassurances yesterday that the project was not at risk.
A spokeswoman said: “It has no affect on our project. It’s in the early stages of planning.”
Energy Minister Charles Hendry also reaffirmed the government’s commitment to CCS, and said the Peterhead development was a “striking example”.
Speaking to the Press and Journal, he said: “We are absolutely committed to CCS and we want to see it happen on gas as well as coal.
“A striking example of that (gas) is SSE and Shell’s plan. It will undoubtedly be one in the competition. We are now looking at faster competition to take that forward.
“The £1billion is still there, it is still there to be spent.”
But Eilidh Whiteford, SNP MP for Banff and Buchan, said doubts remained.
“There is still a questionmark and we need to get clarity on it,” she said.
“It’s really important that these projects don’t have the rug pulled out from under them.”
The gas-fired power station on Peterhead’s outskirts has been in “pole position” for a slice of the £1billion investment to develop the technology after the collapse of a similar coal-fired project at Longannet in Fife.
The plans involve taking CO emissions from a 385-megawatt gas-powered turbine and pumping them to the Goldeneye platform in the North Sea and into an existing gas reservoir.
A study revealed this year that the project could create 937 jobs and attract £590million of investment during the construction phase.
Energy Secretary Chris Huhne launched a CCS test project at the coal-fired Ferrybridge power station in West Yorkshire yesterday.
He said: “This flagship test programme at Ferrybridge represents an important milestone in the UK’s plans to develop CCS and provides a critical bridge to meeting our long-term aim of cost-competitive CCS deployment by the 2020s.”