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Second phase funding for industrial decarbonisation projects awarded


Second phase funding for industrial decarbonisation projects awarded cover image

UK Research and Innovation (UKRI) have announced £171 million of funding for phase two of the industrial clusters as part of the Industrial Strategy Challenge Fund (ISCF).

At the DGA, we are delighted that the following projects have been awarded funding to commence the deployment stages. In the competition the projects were expected to support delivery of significant emissions reductions by 2030. The projects include offshore storage sites for CO2, CO2 capture and hydrogen production as well as transportation and usage schemes.

Projects were required to demonstrate that their proposals had regional and national significance and that they supported the UK to reach net zero by 2050.

This news is particularly pleasing as the DGA was highly influential in establishing the industrial clusters mission, and in the subsequent allocation of Industrial Strategy Challenge funding by government.

View the video produced by UKI to support the announcement https://lnkd.in/eWQPuCE

The successful projects

https://www.ukri.org/news/ukri-awards-171m-in-uk-decarbonisation-to-nine-projects/

HyNet (offshore) – hydrogen and CCUS – £13,324,521

Organisations involved:

  • Progressive Energy Ltd (lead)
  • ENI UK Ltd.

HyNet is one of the most advanced, low risk and cost-effective full chain hydrogen and CCUS industrial decarbonisation projects in the UK.

While industrial decarbonisation is the anchor, the project builds the infrastructure backbone for a full regional hydrogen economy. It leverages the opportunity to repurpose existing oil and gas facilities for future CCUS.

A dedicated network will transport hydrogen from production to demand points and storage assets. The network will provide the infrastructure to transport and store the CO2 produced as a by-product of the hydrogen production process and CO2 from a number of the UK’s largest industrial emitters.

HyNet (onshore) – hydrogen and CCUS – £19,451,381

Organisations involved:

  • Progressive Energy Ltd (lead)
  • Cadent Gas Ltd
  • University of Chester
  • CF Fertilisers UK Ltd
  • ENI UK Ltd
  • Essar Oil (UK) Ltd
  • Castle Cement Ltd
  • Inovyn Enterprises Ltd.

Scotland’s net zero infrastructure (offshore) – £11,347,956

Organisations involved:

  • Pale Blue Dot Energy Ltd (lead)
  • Petrofac Facilities Management Ltd.

This project will focus on developing the offshore Acorn storage site and associated offshore infrastructure. The project will fund important engineering studies. It will develop the key offshore components of the cluster, increasing investor confidence and providing the storage capacity to make a net zero industrial cluster in the UK a reality.

This proposal seeks to develop the major offshore storage components of the Scottish industrial cluster. It will develop offshore pipeline, subsea and well-related infrastructure to transport and inject the CO2 offshore for long-term secure storage.

The onshore and offshore projects together provide a clear and tangible path to decarbonisation of the Scottish industrial cluster. It will open up opportunities to support other industrial clusters in the UK and abroad.

Scotland’s net zero infrastructure (onshore) – £19,956,777

Organisations involved:

  • Pale Blue Dot Energy Ltd (lead)
  • University of Strathclyde
  • Neccus
  • SSE Generation Ltd
  • National Grid Plc
  • GBTron Power Ltd.

This project will focus on developing the offshore Acorn storage site and associated offshore infrastructure. The project will fund important engineering studies. It will develop the key offshore components of the cluster, increasing investor confidence and providing the storage capacity to make a net zero industrial cluster in the UK a reality.

This proposal seeks to develop the major offshore storage components of the Scottish industrial cluster. It will develop offshore pipeline, subsea and well-related infrastructure to transport and inject the CO2 offshore for long-term secure storage.

The onshore and offshore projects together provide a clear and tangible path to decarbonisation of the Scottish industrial cluster. It will open up opportunities to support other industrial clusters in the UK and abroad.

Net zero Teesside (onshore) – £28,052,338

Organisations involved:

  • BP Exploration Operating Company Ltd (lead)
  • The North East of England Process Industry Cluster Ltd
  • Sembcorp Utilities (UK) Ltd
  • Boc Ltd
  • Shell UK Ltd
  • CF Fertilisers UK Ltd
  • Tees Valley Combined Authority
  • Eni UK Ltd
  • Equinor New Energy Ltd
  • National Grid Carbon Ltd
  • Total Gas & Power Chartering Ltd.

The project anchor is a world first flexible gas power plant with CCUS, which will complement rather than compete with renewables. It will capture approximately two million tonnes of CO2 annually from 2026, decarbonising 750MW of flexible power. It will enable a reduction of Teesside’s emissions by one third through partnership with industrial stakeholders.

CO2 will be permanently and safely stored in a well-understood large geological aquifer located in the Southern North Sea.

The development is estimated to:

  • support and safeguard between 35% and 70% of existing manufacturing jobs in Tees Valley
  • have an annual gross benefit of up to £450 million for the Teesside region
  • support of up to 5,500 direct jobs during construction.

Northern endurance partnership – £24,002,130

Organisations involved:

  • BP Exploration Operating Company Ltd (lead)
  • Shell UK Ltd
  • Eni UK Ltd
  • Equinor New Energy Ltd
  • National Grid Carbon Ltd
  • Total Gas & Power Chartering Ltd.

The project will create an offshore CO2 transport and storage system connecting two innovative first-of-a-kind onshore capture projects into one initial geological store.

The combined onshore anchor projects aim to capture three million tonnes of CO2 annually from 2026, decarbonising 750MW of flexible power at Teesside. It will reduce emissions by one million tonnes a year in Humber by fuel switching the Saltend chemicals park to blue hydrogen.

Gas power with CCUS, large-scale blue hydrogen and a combined offshore CCUS scheme will be world firsts. This project has the potential to underpin over 25,500 jobs in the Humber/Teesside area, showcasing a broad range of decarbonisation technologies, globally unparalleled in scale, optionality and ambition.

Zero Carbon Humber (ZCH) partnership – £21,496,246

Organisations involved:

  • Equinor New Energy Ltd (lead)
  • University of Sheffield
  • British Steel Ltd
  • National Grid Carbon Ltd
  • Centrica Storage Ltd
  • Saltend Cogeneration Company Ltd
  • Associated British Ports
  • Drax Corporate Ltd
  • Uniper UK Ltd
  • PX Ltd
  • SSE Generation Ltd
  • Mitsubishi Hitachi Power Systems Europe Ltd.

ZCH will deliver first-of-a-kind low-carbon infrastructure, comprising CO2 and hydrogen transmission pipelines linking the region’s major emitters. It will provide a pathway to deliver at-scale decarbonisation. The infrastructure will be anchored by the H2H-Saltend project.

The low-carbon infrastructure’s parallel CO2 and H2 pipelines will enable CO2 emissions to be captured and transported, and fuel-switching of end-users to H2 for a long-term sustainable transition to low-carbon energy.

Additionally, H2H-Saltend will develop a low-carbon ammonia export product and partially decarbonise all other products produced on-site.

Humber Zero – £12,692,948

Organisations involved:

  • VPI Immingham LLP (lead)
  • Phillips 66 Ltd.

Humber Zero plans to decarbonise the world-scale industrial complex at Immingham, representing approximately 8MTPA of CO2 emissions, by the late 2020’s via a combination of technology pathways.

This will create a carbon capture and hydrogen hub, providing cost-effective decarbonised energy supply and storage opportunities to industry and the National Grid.

The project will retrofit post combustion capture plant to two existing gas turbines and auxiliary boilers at VPI’s Combined Heat and Power plant, and a major process unit (Fluid Catalytic Cracker) at Phillips 66’s Humber Refinery.

South Wales Industrial Cluster (SWIC) – £19,999,997

Organisations involved:

  • Costain Oil, Gas & Process Ltd (lead)
  • Tarmac Trading Ltd
  • Tata Steel UK Ltd
  • University of South Wales
  • Progressive Energy Ltd
  • Wales & West Utilities Ltd
  • Milford Haven Port Authority
  • RWE Generation UK Plc
  • CR Plus Ltd
  • Valero Energy UK Ltd
  • Capital Law Ltd
  • Associated British Ports
  • Sector Development Wales Partnership Ltd
  • Simec Uskmouth Power Ltd
  • Lanzatech UK Ltd
  • Lightsource BP Renewable Energy Investments Ltd
  • Shell UK.

SWIC will create pathways and opportunities to promote Wales as a leading global player in decarbonised industrial and economic growth.

The project will devise options to support regional hydrogen deployment and to develop CCUS as an interim measure.

It will nurture symbiosis between industry, cities/towns, transport, and agriculture. It will be achieved through sustainable clean growth plans that maintain a growing and diverse industrial sector region. This could potentially protect 103,000+ existing jobs, part of the project’s central aim to protect the future of these communities.

SWIC will also provide the UK with lower carbon steel and reduced carbon cement products that form the backbone of the wider UK Infrastructure Industry.

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