Four companies are to compete for funding to develop what is likely to be the UK’s first commercial-scale demonstrations of carbon capture and storage technology, says the UK’s Department for Business.

BP, E.On UK, Peel Power and Scottish Power Generation have been named as the four pre-qualified bidders who will move forward to the next stage of the country’s CCS competition, which forms part of a wider strategy to deploy low carbon technologies and reduce the carbon intensity of the UK’s economy.

The government has also launched a consultation process that aims to provide a consistent understanding of carbon capture readiness and help in the development of a sound regulatory and legislative framework for CCS.

The four companies have been selected from nine that submitted proposals to the government earlier this year relating to the demonstration of post-combustion carbon capture on a coal-fired power plant. The demonstration project must capture 90 per cent of the carbon dioxide (CO2) emitted by the equivalent of 300-400 MW generating capacity and be on-line by 2014.

The winner of the competition will win government funding for its proposed project, but will compete with UK coal company Powerfuel for the acclaim of developing the country’s first CCS-equipped power plant.

Powerfuel has announced the selection of GE Energy’s gas turbine technology for its planned integrated gasification combined cycle (IGCC) power plant in Yorkshire, making the prospect of commercial operation by 2013 a reality. The plant will use CCS technology to capture 90 per cent of CO2 emissions and will be equipped with Shell’s gasification technology.

Powerfuel’s Hatfield IGCC project was excluded from the CCS competition as it will use pre-combustion, rather than post-combustion capture.

The four prequalified bidders will now continue discussions with the government over technical, commercial, contractual and financial issues.

“Alongside nuclear, renewables and gas, coal is and will continue to be a feature of the UK’s electricity mix,” said Energy Secretary John Hutton. “The progress we are making with the CCS demonstration competition and on developing a sound legislative and regulatory framework will help to deliver our ambition to see CCS ready for commercial deployment by 2020.”

E.On UK has put forward its planned Kingsnorth clean coal power plant in Kent for the CCS demonstration. It is supported by six partners to cover the entire CCS chain, including Arup, EPRI, Fluor, Mitsubishi and Tullow Oil. It has submitted an application for planning consent but has asked for the decision on this to be delayed until the government completes the consultation process.

The Kingsnorth project will consist of two 800 MW supercritical coal fired units. E.ON hopes to have the project on-line by 2012

Scottish Power Generation has proposed a project at its Longannet power station in Scotland. Its consortium also includes Marathon Oil, Aker Clean Carbon and Aker Solutions.

“The competition clearly demonstrates the UK government’s willingness to be a front runner in the realisation of CCS,” said Jan Roger Bjerkestrand, Chief Executive Officer at Aker Clean Carbon. “This marks another important step in the effort to commercialise our cost-effective capture technology, ‘Just Catch’”.

BP says that its proposal does not relate to a specific project but that it has participated in the prequalification process so that it could offer its expertise to others taking part.

“We have experience in reservoir management, pipeline infrastructure, chemical separation of feedstocks and flue gas, and project management,” a BP spokesman told MPS.

BP had hoped to submit a clean coal project at Peterhead with CO2 storage in the Miller oilfield in the North Sea to the CCS competition. The project, in conjunction with Scottish & Southern, was cancelled after the pending closure of the oilfield meant that the project’s schedule did not fit in with the timetable of the CCS competition.

The UK government has also called for greater international collaboration to facilitate the wide-scale deployment of CCS technology.

“We … continue to urge other countries to demonstrate a similar level of commitment to demonstrating CCS as the UK,” said Hutton. “We must ensure CCS is recognised in the EU Emissions Trading Scheme and the Clean Development Mechanism, and have been pushing hard for it to be high on the agenda at the forthcoming G8 Leaders meeting.”

The government’s consultation asks for views on what more can be done to promote, develop and deploy CCS in the UK, EU and globally, focussing on the principle of carbon capture readiness and the regulation of CO2 storage.