On reading the British government’s press release on the future of the North Sea, it became clear, quite quickly, that this was a proposal that had been planned for some time. The press release itself is relatively bland: it’s the plethora of quotes from CEOs and civic leaders that tells you that this has been in the works for weeks if not months. There is no way on God’s earth that this was knocked up as a response to the Uxbridge by-election: communications and legal departments in big companies just don’t work that quickly. So, we can assess this, as we did with Labour’s plan for the North Sea, on its merits rather than as just a piece of midsummer political jousting.

The first thing to say is that this policy is infinitely more serious than the undergraduate efforts of the Labour Party which appear to be under the impression both that petroleum engineers can switch their expertise to installing wind turbines overnight and that we can always rely on others to ensure the UK’s energy security. It’s no surprise then that Sunak stressed energy security, job security and carbon capture and underground storage (CCUS) in his press release and his media round.

On energy security, Sunak surely has a point: President Putin, his disastrous war and the gas price response last year are evidence enough that, while gas remains a key part of our energy mix and will do so for the foreseeable future, we should be making sure we have ample domestic supplies. And, even though that gas from UK waters is sold into a global market, like other commodities, the cheapest gas is that which has the least distance to travel. On jobs, Sunak also has right on his side: Labour is correct that jobs in the energy sector in the 2030s and 2040s will be much more focused on renewable energy than they are today but that’s not the case right now while the North Sea continues to be a significant, if declining, hydrocarbon basin and, just as crucially, the UK continues to consume vast quantities of gas, especially in the winter. So far, so good for Sunak and his team who at this point are 2-0 up and hoping that CCUS completes the hattrick.

Alas, not so fast. There’s three things you need to know about CCUS: it’s not new, it’s technically complicated and it’s very expensive. As ever in the world of energy, if it was a panacea we’d already be using it and we’re not. Like hydrogen, heat pumps, wave energy and every other suggestion that’s out there, the world is only looking at CCUS because of the climate crisis not because it’s something anyone actually wants to do or can afford to do. Sequestering carbon, injecting carbon and storing carbon are not cheap, not easy and not even – right now – particularly effective and there’s a lot more research and innovation required before CCUS becomes a go-to, solve-all technology.

Nevertheless, interest in the sector is increasing: currently there are 40 carbon capture facilities operating globally which is over double the number 10 years ago. Furthermore, according to the International Energy Agency (IEA), the number of facilities in advanced development (124) and in the concept and feasibility stage (218) have ballooned in the last three years. This is all down to various stimulus efforts: the 2021 Infrastructure Investment and Jobs Act (IIJA) in the US sets aside $12bn for CCUS, Jeremy Hunt promised ÂŁ20bn for CCUS in his budget earlier this year while the EU and Japan have set ambitious targets for carbon storage by 2030 as well as offering tax breaks and incentives.

As a result, it’s no wonder that the CCUS sector is both booming and is beginning to see results: in the UK, the Net Zero Teeside Power station is expect to come online in 2027 and will be the world’s first commercial-scale gas-fired power station that using CCUS for its emissions. We’re also seeing technical advances too as the weight of investment makes an impact with significant innovations around carbon sequestering in particular. Arguably, this innovation around CCUS has to be funded by governments – there’s nowhere else that capital of the scale required will come from – but that does serve to underline, somewhat inconveniently, the problem that carbon capture begins with: that, for now at least, it’s too damned expensive.

Sunak and the Tories are miles ahead of Labour on energy policy and this is clearly demonstrated by their opposing views of what should happen in the North Sea. However, this doesn’t get either party away from the fact that neither of them have really moved beyond the glibness of the Johnson era where environmental promises and targets were scattered without either thought or seriousness. Chris Skidmore MP, author of last year’s Independent Review of Net Zero, complained bitterly this week that Sunak has got it all wrong with his promise to grant many more exploration licences in the North Sea.

Skidmore would have been a lot better off pointing to his review, the government’s thoughtful reply and asking how this government and the likely future Labour government are going to reach the targets they’re aiming for. No petrol cars to be sold after 2030? No gas boilers in new build houses from 2025? Decarbonising all sectors of the UK economy by 2050? In an economy that consumed 72 billion cubic metres of natural gas in 2022? As John Major used to say in his Pooterish moments, “fine words butter no parsnips”. 

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