Decarbonisation Technology May 2026 Issue

power transition. CCUS enables these industries to produce low-carbon versions of the materials the world increasingly demands, strengthening competitiveness while maintaining domestic capability. A European carbon storage opportunity As the UK-EU relationship evolves following the reset discussions last year,

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Prospective (risked) Contingent Permitted Condence level

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CCC Seventh Carbon B udget 2050 ambition

DESNZ Carbon B udget and G rowth D elivery P lan 2037 ambition

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Figure 3 UK licensed CO₂ storage potential

heartlands. This will require a nationwide allocation framework and clear routes to market for future projects. One important example is the Peak | Morecambe Net Zero (MNZ) Cluster across Derbyshire and Staffordshire, which aims to decarbonise 40% of the UK’s cement and lime industry – sectors that are among the most emissions-intensive and essential to modern economies. “ Access to UK storage could reduce decarbonisation costs for European emitters by up to 28%, delivering savings of €2-2.7 billion annually by 2040 ” The project will attract £5 billion of private capital investment and could safeguard around 2,000 jobs while creating thousands more during construction and operation. The project took a major step forward last year with a £28.6 million equity investment from the National Wealth Fund. This is development funding for the pipeline between Peak Cluster and MNZ, demonstrating the role that public finance can play in delivering these critical projects. This really matters at a time when UK cement production is at its lowest level since the 1950s, and imports have tripled. Cement and lime underpin critical infrastructure, from homes, schools, and hospitals to water systems and the energy infrastructure needed for the clean

there is a clear opportunity to strengthen cooperation on energy by developing a Europe- wide carbon management market, with the UK playing a leading role. CCUS offers a practical route to deepen this partnership while positioning Britain at the forefront of a new global industry. The UK holds around one-third of Europe’s potential CO₂ storage capacity, giving it a natural advantage as a regional hub for carbon storage (see Figure 3 ). This creates a significant economic opportunity, allowing the UK to provide carbon management services to European industry while supporting the development of a high-value domestic sector. Access to UK storage could reduce decarbonisation costs for European emitters by up to 28%, delivering savings of €2-2.7 billion annually by 2040, while creating export opportunities worth around £2 billion per year by 2030, rising to £30 billion in annual UK tax revenues by 2050. Crucially, this model supports industrial regions on both sides of the Channel, helping to sustain production, protect jobs, and maintain competitiveness as industries transition. Much of the infrastructure required to support this market, including pipelines, shipping routes, and offshore storage, is already in place or under development. The primary barrier is not technology, but the need for policy alignment. Progress towards linking the UK and EU Emissions Trading Systems would be a key step