The UK government announced on Friday that it will make up to £21.7 billion available over the next 25 years for the development of two new “carbon capture clusters” capable of removing and storing more than 8.5 million tonnes of industrial carbon emissions per year.

In addition to supporting new carbon capture and CCUS enabled hydrogen projects, the new funding announcement is expected to attract £8 billion in private investment into the local communities hosting the projects and directly create 4,000 jobs, the government said.

Energy Secretary Ed Miliband said:

“By securing this funding, we pave the way for securing the clean energy revolution that will rebuild Britain’s industrial heartlands.”

Carbon capture and storage forms a key part of the UK’s strategy to achieve net zero emissions by 2050, most notably as a solution to enable emissions reductions from emissions-intensive and difficult to decarbonize industries, such as steel, cement and chemicals.

The announcement follows the government’s release last year of CCUS Vision, setting out its plan to establish the UK as a global leader in carbon capture, usage and storage (CCUS), with goals to ramp up CCUS in the UK to at least 20 million tonnes of CO2 by 2030, and to create a competitive, self-sustaining CCUS market in the UK from 2035. The CCUS Vision also highlighted opportunities for the UK to capitalize on its unique geology, infrastructure, capabilities, and North Sea storage capacity – estimated at 78 billion tonnes of CO2 – to offer storage services to other countries. The vision’s first stage, “Market Creation,” included plans for high levels of government support to establish CCUS clusters, supporting the initial CCUS deployments across sectors, and developing carbon transport capacity.

The sites included in the new funding announcement include Merseyside, which encompasses the HyNet North West project, led by energy company Eni, to capture CO2 produced by land-based industrial plants and store it permanently and safely in depleted gas fields in the Irish Sea, and Teesside, which hosts Net Zero Teesside, a project aimed at decarbonizing local industrial, power and hydrogen companies through CCUS deployment, with storage planned in the North Sea. Companies involved in developing infrastructure for the Teesside project include bp, Equinor, National Grid Ventures, Shell and TotalEnergies.

Eni CEO, Claudio Descalzi, said:

“Today’s news is an important step towards the creation of a new business chain linked to the energy transition. HyNet will become one of the first low-carbon clusters in the world and the project will decarbonise one of the key energy-intensive industrial districts as well as unlock significant economic growth in this region of the UK.”

Louise Kingham, SVP Europe and head of country, UK for bp, added:

“Major projects like these have the potential to help stimulate economic growth – supporting thousands of jobs, helping UK companies prosper through the vast supply chains involved and creating the infrastructure to help major industrial companies with their decarbonisation plans.”