Drax's £2bn 'clean coal' project wins government funding

Plans to capture carbon dioxide emissions from power stations and bury them under the North Sea moved a step closer on Monday as the Goverment awarded funding to Drax to develop a proposed “clean coal” plant in Yorkshire.

The £2bn “White Rose” project would be one of the first commercial-scale “carbon capture and storage” (CCS) plants, which ministers claim could eventually be used to power all UK homes.

The Government has pledged £1bn funding for CCS projects but critics say they have made slow progress in getting the embryonic technology off the drawing board.

The award to Drax is understood to be tens of millions of pounds, to fund engineering, planning and financial work. If the plant were built it would also be entitled to subsidies.

Drax would build a new coal-fired power plant capable of powering 630,000 homes, with 2m tonnes of carbon dioxide emissions each year captured and piped by National Grid into a depleted North Sea gas field.

Ministers are also in talks with a second proposed CCS project, Shell and SSE’s Peterhead plan, which would burn gas. Ed Davey, the energy secretary, told the Telegraph the talks were going “incredibly well”.

Mr Davey said CCS could be “a game-changer in tackling climate change and provide a huge economic advantage”.

The energy department said up to 12 gigawatts of CCS plants could be built by 2020 and 40GW by 2030, which “could well be generating more electricity than total domestic electricity demand”.

Coal currently accounts for 40pc of UK power but most of the remaining plants will be forced to shut in coming years due to the government’s carbon tax.

Mr Davey rebuffed