UK unveils £139m fund for decarbonising industry

The UK Government has announced £139 million funding towards its ambition to create the world’s first net-zero carbon industrial cluster by 2040, with at least one low-carbon industrial cluster by 2030.

Carbon dioxide (CO2) capture, CO2 storage and CO2 utilisation are likely to play a key role in decarbonising each of the clusters; either directly to abate process or combustion emissions or indirectly to support measures, such as fuel switching from natural gas to hydrogen and greenhouse gas removals through, for example, bioenergy with CCS.

Projects across the UK can bid for support from the Industrial Decarbonisation Fund, which forms part of the government’s “levelling up” agenda to boost economic growth in UK regions in critical need of support, as well as contributing to its target of net zero greenhouse gas emissions by 2050.

The funding is being provided in two complementary streams and as two phases, with funding of up to £131m for deployment projects – which will either deliver or support delivery of significant emissions reductions in a UK industrial cluster by 2030 – and £8 million for decarbonisation roadmaps, or cluster plans, for major UK industrial clusters.

The locations of the UK’s industrial clusters are well understood and are in three of the four countries of the UK. Phase one, in which projects were funded to scope and develop their ideas and build partnerships, ended this summer with phase two opening for applications straight after. Successful projects are expected to start in January (cluster plans) and March (deployment projects) 2021.

The clusters and their projects (as at summer 2020) are listed below, in their own words:


Scotland’s Net Zero Infrastructure enables CCS by linking the gathering of CO2 from industrial emitters around Grangemouth with the Acorn CCS Project in north east Scotland, via pipeline to the St Fergus gas terminal in Aberdeenshire.

Scotland’s Net Zero Roadmap (SNZR) builds upon work by SCCS and the University of Strathclyde's Centre for Energy Policy in identifying decarbonisation pathways that deliver economic prosperity and applies them to a high-value industrial cluster.

Teesside (North-East England)

Net Zero Teesside Project – This carbon capture, utilisation and storage (CCUS) project, in partnership with local industry and world-class partners, aims to decarbonise a cluster of carbon-intensive businesses by as early as 2030. Each year, the project plans to capture up to 6 million tonnes of CO2 emissions equivalent to the annual energy use of up to 2 million UK homes.

Net Zero Tees Valley – This will allow the industrial net-zero roadmap of the Teesside Industrial Cluster to be extended. It will develop a deliverable and holistic plan for regional deep decarbonisation, which can be adopted by industry, government, local government, the finance sector and investors.

Humber (North-East England)

Humber Industrial Decarbonisation Deployment Project (Humber DP) – This will identify and develop potential anchor projects to maximise emission reductions in the most appropriate, timeliest, cost-effective and efficient manner and develop world-leading industrial CO2 transport and storage system.

Green Hydrogen for the Humber - "Green Hydrogen for Humberside" will lead to the production of renewable hydrogen, at the Gigawatt (GW) scale, from polymer electrolyte membrane (PEM) electrolysis. This will be distributed to a mix of industrial energy users in Immingham, Humberside. Humberside, the UK's largest cluster by industrial emissions (12.4MtCO2 per year), contributes £18bn to the national economy each year and has access to a large renewable resource from offshore wind in the North Sea.

Humber Industrial Decarbonisation Roadmap – HIDR will enable the Humber's large industrial emitters, low carbon infrastructure providers and other stakeholders to develop a shared approach to achieving net zero by 2040.

North West England

HyNet CCUS – HyNet was conceived in 2016 as a hydrogen / CCUS project to provide a decarbonisation pathway in the North West. The HyNet CCUS network will provide the infrastructure to transport and store the carbon dioxide produced as a by-product of the hydrogen production process.

North West Hydrogen and Energy Cluster: Route to Net Zero – This project’s primary focus is on the industrial emissions of Cheshire, parts of North East Wales, Warrington, Liverpool City Region and Greater Manchester.

South Wales

South Wales Industrial Cluster (SWIC) – SWIC will identify process options to reduce carbon emissions, options for Carbon Capture Usage and Storage (CCUS) and for an infrastructure backbone to enable large-scale CO2 emissions reduction across Wales and beyond.

SWIC Roadmap - The Phase-1 work will establish NZC options for SWIC members; including two of the largest industrial UK CO2 emitters, several large sites and several medium sized sites. This will allow the several mini-local clusters to form, before growing and combining with each other, ultimately merging to connect to the large coastal CO2 emitters, at which point large scale CCU-CCS options exist creating value from residual regional carbon.

Midlands (England)

Repowering the Black Country - this study will specifically identify the best ways to deliver zero carbon power to local businesses using local resources, including commercial waste and renewable energy. Small-scale, unobtrusive power stations, located on brownfield sites, will deliver electricity and heat to nearby homes and businesses.

Graphic: UK Government