Abby L. Harvey
GHG Monitor
4/18/2014
The European Investment Bank has completed the second and final round of emissions allowance sales under the New Entrants Reserve (NER) 300 program, reportedly raising approximately €548 million from the sale of 100 million allowances. The first 200 million allowances were sold from 2011 to 2012 and generated €1.5 billion in funding. Of that, €1.2 billion was awarded to 23 renewables projects, much to the disappointment of CCS proponents in Europe. At the onset of the NER 300 program, it was hoped that the funding scheme would spur up to 12 large-scale CCS demonstration projects across Europe. However, decreasing carbon costs lead to lower revenue totals on the sale of the 300 million allowances sold over the course of the program, making it clear at an early stage that the program would not raise enough in funding to support expensive CCS projects.
With the close of the second round of allowance sales only one CCS project remains viable in the NER 300 competition, as all others have pulled out or were deemed ineligible after member states failed to promise financial backing. A maximum of 15 percent, or €300 million, of the total funds raised by NER 300 is likely to be awarded to White Rose, a CCS project run by British utility Drax, according to reports this week. White Rose would become Europe’s first CCS plant, a 426 megawatt coal burning facility which would be located in Yorkshire. The plant is being managed by the Capture Power Ltd consortium, made up of BOC Group and Alstom SA. A formal announcement of the winners of the NER 300 scheme is expected to be made in June.
