UK invests £28.6mn in carbon capture project to decarbonise cement and lime

The UK’s National Wealth Fund is providing £28.6 million in equity to support the Peak Cluster carbon dioxide transport pipeline – part of a carbon capture project meant to decarbonise the cement and lime industry.

The sovereign wealth fund’s investment is part of a £59.6 million equity raise that also includes Summit Energy Evolution (part of Sumitomo Corporation), Progressive Energy Peak and Peak Cluster cement and lime producers Tarmac, Breedon, Holcim and SigmaRoc as financiers.

The planned pipeline will transport CO2 emissions captured in industrial plants across Derbyshire and Staffordshire to be stored at Spirit Energy’s Morecambe Net Zero (MNZ) carbon storage facility in the East Irish Sea – itself a converted gas field. 

Cement and lime production facilities in Derbyshire and Staffordshire represent 40% of the UK’s output of these crucial construction and manufacturing materials. As such, the Peak Cluster carbon capture and storage (CCS) project could be instrumental in decarbonising this hard-to-abate sector, as well as creating around 13,000 jobs.

UK Energy Secretary Ed Miliband said: “This landmark investment will catalyse our carbon capture sector to deliver thousands of highly skilled jobs and growth across our industrial heartlands, as part of our Plan for Change. Workers in the North Sea and Britain’s manufacturing heartlands will drive forward the country’s industrial renewal, positioning them at the forefront of the UK’s clean energy transition.”

Cement production alone is responsible for around 8% of global GHG emissions.

Peak Cluster CCS to reach final investment decision in 2028

The National Wealth Fund’s investment is set to reduce risk for the Peak Cluster CCS project, removing barriers to private financing and getting the plans over the line – with a final investment decision expected in 2028.

With the new equity, the project developers will complete Front-End Engineering and Design (FEED) and other studies that underpin the planning consent process.

Chancellor of the Exchequer, Rachel Reeves, added: “The National Wealth Fund is a force for growth, investing £3 billion into the British economy and securing 12,500 jobs. We're modernising the cement and lime industry, delivering vital carbon capture infrastructure and creating jobs across Derbyshire, Staffordshire and the North West to put more money into working people’s pockets."

John Flint, National Wealth Fund CEO, also commented: “Substantial private investment, deployed at risk, will be needed to develop and deliver carbon capture projects across the UK. Through its investments, the NWF is well placed to support this. Capital must be committed now, especially in hard to abate sectors such as cement and lime, to ensure a pipeline of projects is ready for deployment and the UK is able to meet its ambitious carbon capture targets”.