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Cluster Sequencing for Carbon Capture Usage and Storage Deployment: Phase-1Cluster Plan submission form

May 2021

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Contents

Cluster Plan introduction_______________________________________________________2

Important information regarding this process______________________________________2

Disclosure of information_____________________________________________________2

Glossary of terms___________________________________________________________2

Definitions_________________________________________________________________2

Units_____________________________________________________________________2

1. Applicant information________________________________________________________2

2. Cluster summary___________________________________________________________2

3. Cluster overview____________________________________________________________2

4. Credibility_________________________________________________________________2

5. Deliverability_______________________________________________________________2

6. Emissions reduction_________________________________________________________2

7. Economic benefits__________________________________________________________2

8. Cost considerations_________________________________________________________2

9. Learning and innovation______________________________________________________2

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Cluster Sequencing for Carbon Capture Usage and Storage Deployment: Phase-1

Cluster Plan introduction

In November 2020, the government published the Ten Point Plan for a Green Industrial Revolution1, with commitments focused on driving innovation, boosting export opportunities, and generating green jobs and growth across the country to level up regions of the UK. In doing so, government has set its agenda for a clean, resilient and sustainable economic recovery, as the UK builds back from the impacts of Covid-19.

Included in the Ten Point Plan was a commitment to deploy Carbon Capture, Usage and Storage (CCUS) in two industrial clusters by the mid-2020s, and a further two clusters by 2030 with an ambition to capture 10 MtCO₂ per year by 2030. In February this year, BEIS published a consultation2 seeking input on a potential approach to determine a natural sequence for locations to deploy CCUS in order to meet this commitment.

This document sets out the questions that clusters should answer as part of their Cluster Sequencing submission. The information and relevant supporting evidence provided by clusters within the completed Cluster Plan will, alongside the Economic Benefits (Annex B) and Cost (Annex C) templates, form the basis of the assessment to determine which clusters will be sequenced onto Track-1. This document is an Annex to the Phase-1 Launch Document and should be read alongside it. Please see the Phase-1 Launch Document for further guidance on the assessment process, including how the information will be assessed and note that the caveats and reservations to that document set out in Section 1.6 of that document apply equally here.

The CCUS Cluster Sequencing Process will be run by the Department for Business, Energy and Industrial Strategy (BEIS). If applicants have any general questions about the submission process or about filling in any part of the submission documentation, please email queries to [email protected].

1 www.gov.uk/government/publications/the-ten-point-plan-for-a-green-industrial-revolution/title2 www.gov.uk/government/consultations/carbon-capture-usage-and-storage-market-engagement-on-cluster-sequencing

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https://www.gov.uk/government/consultations/carbon-capture-usage-and-storage-market-engagement-on-cluster-sequencing

https://www.gov.uk/government/consultations/carbon-capture-usage-and-storage-market-engagement-on-cluster-sequencing

https://www.gov.uk/government/publications/the-ten-point-plan-for-a-green-industrial-revolution/title


Important information regarding this process

The deadline for finalised Phase-1 submissions is 17:00 p.m. on 9th July 2021.

This document should be read alongside the Launch Document, including the General Considerations in 1.6 of that Launch Document. The assessment process will be run fairly, transparently, and objectively in accordance with the published guidance.

The information provided within this form will be used within the Phase-1 assessment to sequence Track-1 clusters for deployment in the mid-2020s as described in the Launch Document.

The detailed timetable for this process is set out in the Launch Document.

BEIS will not be responsible for any costs incurred in the preparation of any submission, irrespective of whether the cluster is sequenced for deployment in the mid-2020s.

Clusters will need to pass the eligibility criteria to be considered within the evaluation, as described in the Launch Document.

The evaluation will be based on five evaluation criteria with relative weightings of: Deliverability (30%), Emissions Reduction (25%), Economic Benefits (20%), Costs (15%), and Learning and Innovation (10%).

This document, the Cluster Plan, is divided into nine sections:

- Section 1 asks for Applicant Information and Section 2 asks for a Cluster Summary; this information will provide background and context to assessors when reviewing the rest of the submission and will also be used to determine eligibility.

- Section 3, Cluster Overview, and Section 4, Credibility, do not relate to any specific criterion; information submitted in these sections will be used to improve BEIS’ understanding of the cluster and will be used to determine the credibility and consistency of information provided which could influence a cluster’s score against a range of criteria. BEIS will place significant emphasis on the credibility and consistency of information provided.

- Sections 5-9 each focus on the information required to support one of each of the five evaluation criteria (listed in the bullet above).

BEIS also reserves the right to use information provided within the submission for any part of the assessment; such that information provided in one section, for example for a particular criterion, could be used to inform assessments against another criterion. This is to allow for consistency and credibility checks and not so answers can be continued in other sections. Any obvious continuation of answers will be removed.

After the cluster submissions have been individually assessed, BEIS will carry out a portfolio assessment of the clusters that are sequenced to ensure they meet the government’s strategic objectives. The portfolio factors and process used are described in the Launch Document.

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BEIS reserves the right not to accept any submission and reserves the right to cancel the process before it has completed or at any time before any support has been awarded.

BEIS reserves the right not to consider a submission further if an applicant fails to disclose information requested.

Please note that the word limit does not cover the referencing sections. This is so clusters can be specific as to where information can be found in any documents provided. If this section is used to continue answers, the words will be removed before the assessment. To aid with document referencing please also fill in the References Matrix provided in Annex D.

Similarly, content within referenced materials will not count towards the word limit; however, if BEIS considers that a cluster has used referenced materials to continue an answer this content will not count towards the assessment.

Any information provided above the word limits will be removed before information is provided to assessors and will not count towards the score. We will remove words in excess of the count from the end of the relevant question or section. This will be completed before the documentation is provided to assessors.

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Disclosure of information

Reasons for decisions on submissions will be recorded at all stages for good administration and to ensure that there is a clear audit trail for all decisions. Administrative records will be maintained for all submissions irrespective of whether they are successful or not.

Please refer to Section 2.1 (Entry Process) of the Launch Document for additional detail on entry into non-disclosure agreements and Section 3.5 (Decision Making-Process and Announcements) for additional detail on parties involved in the decision-making process.

All information provided by applicants may be disclosed in accordance with BEIS’s legal obligations (including under the Freedom of Information Act 2000 (FOIA), the Data Protection Act 2018 (DPA), General Data Protection Regulation (GDPR) and the Environmental Information Regulations 2004 (EIR) in the event that a request for information is received). More information on the FOIA and EIR (including information on exemptions) can be found at: https://ico.org.uk/for-organisations/

To help BEIS deal with information requests and without prejudice to the paragraph above, in the box below, please set out the reasons why you consider any specific information should not be disclosed, including (if possible) by reference to the specific exemption contained in the relevant legislation (for example, because disclosure of the information would prejudice your commercial interests under section 43 of the FOIA), explaining why this is the case.

Where appropriate, please also state whether you consider your reasons for non-disclosure only apply for a particular time period. If we receive an information request, we will consider your views as stated on the submission form. However, BEIS will ultimately decide how to respond to an information request and whether any information should be withheld, subject to the Information Commissioner's Office decision in the event of the requestor appealing the decision.

Please detail what specific information, if any, within this submission should not be disclosed and the reasons why. Please include (if possible) reference to the specific exemption contained in the relevant legislation.

Click or tap here to enter text.

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https://ico.org.uk/for-organisations/


Glossary of terms

Acronym Meaning

ABEX Abandonment Expenditure

CAPEX Capital Expenditure

CO₂ Carbon dioxide

COD Commercial Operation Date

DCO Development Consent Order

FEED Front-End Engineering Design

GGRs Greenhouse Gas Removal technologies3

HoT Heads of Terms

JV Joint Venture

LHV Lower Heating Value

MJ/kg Mega-joule per kilogram

MMV Measurement, Monitoring & Verification

MoU Memorandum of Understanding

MWh or MW Mega-Watt Hour or Mega-Watt

OPEX Operating Expenditure

T&S Transport and storage (system)

T&SCo Transport and Storage Company

3 Note that this includes bioenergy carbon capture and storage (BECCS) and Direct Air Capture and Storage (DACCS).

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Definitions

Term Definition

Cluster Transportation and storage network (incorporating the onshore and offshore network and offshore storage facility) and an associated first phase of carbon capture projects.

Cluster Lead Party responsible for submitting the Cluster Plan to BEIS. It should be the entity primarily responsible for the T&S network.

Commercial Operation Date The date when ongoing injection of CO₂ emitter volumes into the store begins. Note: This should not be taken to represent the definition of the COD that will be used within the T&S business model.

Cross Chain All elements of the cluster including development, delivery and operation of all Emitters as well as Onshore, Offshore and storage infrastructure.

Direct Economic Benefits Benefits relating directly to the developer’s own activity, and/or the activity of primary contractors.

Emitter Facility including carbon dioxide emission source(s) targeted for abatement.

Hydrogen Production CCS-enabled hydrogen production.

Indirect Economic Benefits Benefits relating to the remaining CCUS supply chain, outside of the developer and its primary contractors.

Induced Economic Benefits The wider economic benefits that are induced by the development and operation of the cluster in that local area.

Levelised Cost of Abatement Calculation to consider overall lifetime costs of the cluster and the overall carbon abatement in the proposed Cluster Plan. Note: Please see Section 3.3 of the Launch Document for further information.

Mitigation Mitigation refers to actions taken to reduce the overall risk either pre- or post-event.

Offshore The offshore element of the CO₂ transportation network up to the point where CO₂ enters the geological Storage. Note:

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This excludes shipping transportation.

Onshore The onshore element of the CO₂ transportation network which may include intermediate CO₂ storage for T&S operational purposes. Note: This excludes road and rail transportation.

Primary Emitters Emitter projects scheduled to be operational before 2030 and have at least an MoU in place between themselves and the T&SCo.

Storage Geological store for the captured CO₂ from the end of the injection well.

Transfer points Points on and within the Transport and Storage system where there is a commercial boundary, and the ‘ownership’ of the CO₂ is passed from one operational entity to another.

Units

Where possible please use units of measurement defined by the International System of Units (SI) within your answers. For example:

Electrical energy: MWh or MW.

Thermal energy: MWh or MW.

Gas energy: MWh or MW – Gross Calorific Value basis.

Gas calorific value: MJ/kg – Gross Calorific Value basis.

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1. Applicant information

Please provide the contact information for the Custer Lead through the online portal4. Completed versions of this document (in Microsoft Word format), the Economic Benefit template, and the Cost template (Annex C) are to be uploaded to the online portal alongside any supporting evidence and completed References Matrix (Annex D).

2. Cluster summary

2. Executive Summary

2.1 High-level cluster description (300 words)

Please provide a concise summary description (including a clear diagram) of overall T&S system showing emitter entry points, pipeline lengths / sizes / capacities, the location for any compression facilities and capability / capacity, process and stores with a brief description of the overall cluster.

Where is the cluster? What industry and potential emitters are located in that region? How well connected is the cluster to other regions (shipping, road, rail or expansion of the network)?

Respondents may wish to include:

Maps showing the extent of the cluster infrastructure and proposed emitter locations.

A description of the main inter-regional connections and how these could support the longer-term development of the cluster and the wider government aims for large-scale industrial decarbonisation.


2.2 Cluster Lead and Partners (300 words)

Please summarise the organisational structure of the cluster identifying the Cluster Lead and key partner organisations (key emitter projects, storage, offshore and onshore). Please include the status and details of intra-cluster agreements that exist between these

4 The online portal is the system set up to collect all of the relevant information, documents and supporting evidence from the Cluster Lead.

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organisations.


2.3 Cluster status and key metrics (250 words)

Please provide a concise description of the cluster’s stage of development. This should provide descriptions for the cluster as a whole and the contributory individual projects. Please also fill in the metrics within the table provided. Any additional graphs to summarise the emissions profile would be beneficial.

The Primary Emitters are those emitters online before 2030 with at least an MoU in place between the emitter and Cluster Lead (stronger forms of commitment are preferable). The T&S infrastructure costs considered should include any expansion phases required to store the volumes produced by the Primary Emitters.


Metric Value

Commercial Operation Date Click or tap here to enter text.

First injection date Click or tap here to enter text.

Total stored volumes before 2030 (MtCO₂) Click or tap here to enter text.

Cluster carbon intensity for Primary Emitters and T&S (gCO₂/kgCO₂)


Overall capital costs to end of 2050 for Primary Emitters (£m)


Overall operational costs to end of 2050 for Primary Emitters (£m)


Overall capital costs to end of 2050 for T&S (£m)


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Overall operational costs to end of 2050 for T&S (£m)


Levelised Cost of Abatement to end of 2050 Click or tap here to enter text.

2.4 Regional context of cluster (300 words)

Please summarise the importance of existing and future industry to the region in terms of jobs and infrastructure. How does the cluster link into the local regional development plans? The response may include descriptions of historic, current and future planned activities related to regional initiatives and local developments.


2.5 Documentation sign-off (250 words)

Please confirm the information and accompanying documentation provided within your submission has received appropriate Board level sign off. For those areas that do not have appropriate Board level sign off, please highlight, and explain the reasoning within your responses, making sure to include any associated uncertainties.


References to supporting documentation for Section 2


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3. Cluster overview

3. Cluster Overview

3.1 Organisation structures

3.1.1 Overall cluster structure (1000 words)

In this section we are seeking to understand the current and longer-term persisting organisational structure of the cluster.

Please provide details of the organisations that will own and operate transport, storage and capture plants within the cluster. Please also provide details of any organisations providing key services and/or support to the cluster.

Please describe the relationships between the organisations within the cluster including any collaboration agreements, commercial agreements, and joint innovation plans. Where these are still undergoing development please provide a clear and concise description of how and when these will be completed.

Please explain how the cluster intends to function long-term including the approach to developing a Business Management System. Is a bespoke system intended or will policies and procedures be adopted from one (or more) of the cluster partners?


References to supporting documentation for Section 3.1.1


3.1.2 Organisational structure – Cluster Lead (500 words)

In this section we are seeking to understand the organisational structure of the Cluster Lead and the rationale for appointment. Please provide a capability statement, which includes relevant corporate experience and identifies personnel with key roles and responsibilities.

For all arrangements, please confirm the level of authority required to commit to the proposed arrangements (e.g., executive level / Board level).

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Please highlight any areas where there remains uncertainty and the information presented has not yet been agreed between all parties nor gained the necessary approval. Where these are still undergoing development, please also provide a clear and concise description of how and when these will be completed.




3.1.3a Organisational structure – company level (750 words)

Note: Each company participating in the development of an individual T&S or capture project must provide a response. Multiple responses may be necessary where projects are being developed in partnership.

What is the company structure? Please provide a chart which positions the project vehicle within any wider company structure highlighting the following information for each entity within the structure:

Primary activity and location

Ownership (including details of any stock market listings)

Where within the company structure will key investment decisions be taken.

If a new legal entity is to be created for the purpose of this project, where in the company structure this will sit and the expected timing of its incorporation.

Please provide a capability statement, which includes relevant corporate experience and identifies personnel with key roles and responsibilities. Please also provide brief details of the company’s approach to ensuring Corporate Governance best practice.

Please provide details of the ultimate beneficial owner of the corporate group, as well as the details of any shareholder (or group of related shareholders) owning more than 5% of the group’s equity capital.


References to supporting documentation for Section 3.1.3a

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3.1.3b Organisational structure – company level (750 words)


Please see Section 3.1.3a for further details.


References to supporting documentation for Section 3.1.3b


3.1.3c Organisational structure – company level (750 words)




References to supporting documentation for Section 3.1.3c


3.1.3d Organisational structure – company level (750 words)


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References to supporting documentation for Section 3.1.3d


3.1.3e Organisational structure – company level (750 words)


Please see Section 3.1.3a for further details. If additional rows are needed, please insert them into the table below.


References to supporting documentation for Section 3.1.3e


3.1.4a Organisational structure – project level (750 words)

Note: A response is expected for each individual T&S or capture project within a cluster. In the event of multiple participants in a particular project, we would expect to see a single overarching response.

Please describe the organisational structure at a project level including how the delivery of the project will be managed. Please describe the status of any commercial agreements between parties within the delivery structure alongside plans to progress future agreements, including key milestones and any dependencies.

Please also provide details of any new legal entity to be created for the purpose of this project. Where relevant please include any anticipated joint venture arrangements or

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agreements alongside the activities and associated timeline to finalise any joint venture arrangements.




3.1.4b Organisational structure – project level (750 words)






3.1.4c Organisational structure – project level (750 words)




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3.1.4d Organisational structure – project level (750 words)






3.1.4e Organisational structure – project level (750 words)


Please see Section 3.1.4a for further details. If additional rows are needed, please add them into the table below.




3.2 Storage system (2000 words)

3.2.1 Store description

In this section please provide a clear and concise description of the store(s) to be used, where storage will commence prior to 2030, covering the type of store, appraisal

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requirements, capacity, store initial and final pressures, maximum injection capacity over time, and current expectations on pressure management. If available, please can you provide a full storage development plan as a reference document (to include MMV plan with uncertainties and risks identified with interventions and mitigation options).


3.2.2 Wells and Completions

Please can you provide a concise summary description of the Wells and Completions that will be used. This should include a clear explanation of any wells that are to be re-used and the extent to which there are any abandoned wells on the storage structure(s). Please also describe how the potential leakage path risks from these will be mitigated.


3.2.3 Measurement, Monitoring and Verification

Please provide a concise description of the baseline measurement and monitoring requirements as they are currently understood for the pre-operational, operational and post-operational periods for the whole storage complex and potentially high-risk discrete points such as old wells. Please include the cost estimates for these activities whilst discussing the accuracy and uncertainty of these estimates.


References to supporting documentation for Section 3.2


3.3 Offshore transportation (2000 words)

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3.3.1 Offshore transportation infrastructure and system

Please provide a concise description of the offshore transportation infrastructure and system. This should confirm any custody transfer points proposed and include technical details of water depth, location, seabed conditions, currents, climate, pipeline/cable crossings, consents and environmental impact assessment. This should include a diagrammatic representation of the overall offshore transportation system as presently developed and expected to be installed by 2030.


3.3.2 Offshore pipelines

Please provide a concise description of the offshore CO₂ pipeline length, material, diameter, pressure rating, wall thickness, installation requirements. Please include description of any pipelines that will be re-used, their condition (as defined by surveys) and any constraints in the system caused by their re-use. Where information relating to the actual condition of re-use assets is to be confirmed through surveys, please provide a description of the rationale for using the assumed condition basis and the impact of this uncertainty on the overall cluster. Only include pipelines that will be installed or reconditioned and put into service before 2030.


3.3.3 Injection facilities

Please provide a concise description of any subsea or surface injection facilities within the proposed transport and storage system expected to be installed by 2030. This should include information such as: the number of slots available; services and any chemicals required at the subsea manifold / platform; any processing required at platform(s) (if present); the subsea Xmas Tree type (if subsea); power requirements; access method (if platform) and controls etc.

Please also provide a concise explanation of whether any of these facilities will be re-used, and if so, what their condition is and the constraints caused by their re-use on schedule and operations (if known). Where information relating to the actual condition of re-use assets is to be confirmed through surveys, please provide a description of the rationale for using the

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assumed condition basis and the impact of this uncertainty on the overall cluster.




3.4 Onshore transportation (1500 words)

3.4.1 Onshore transportation infrastructure and system

Please provide a concise description of the proposed onshore network expected to be installed before 2030. This should confirm any custody transfer points proposed, a diagrammatic representation of the onshore transportation system and a concise explanation of the regional topography and landscape features influencing network design (e.g. road, rail and river crossings, gradients etc.).


3.4.2 Onshore pipelines

Please provide a concise description of the onshore CO₂ pipeline covering its length, material(s), diameter, pressure rating, wall thickness, installation requirements. Please also provide a concise explanation of whether any pipelines will be re-used, and if so, their condition and any constraints caused by their re-use on schedule and operations (if known). Where information relating to the actual condition of re-use assets is to be confirmed through surveys, please provide a description of the rationale for using the assumed condition basis and the impact of this uncertainty on the overall cluster. Only include pipelines that will be installed or reconditioned and put into service before 2030.


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3.4.3 Above ground installations

Please provide a concise description of the location of control rooms and any above ground installations (AGIs) expected to be installed before 2030. This should explain any pressure boosting requirements, power consumption and redundancy considerations that have been identified. Please also provide a concise explanation of whether any of these facilities will be re-used, and if so, what their condition is and the constraints caused by their re-use on schedule and operations (if known). Where information relating to the actual condition of re-use assets is to be confirmed through surveys, please provide a description of the rationale for using the assumed condition basis and the impact of this uncertainty on the overall cluster.




3.5 Emitters

3.5.1 Primary Emitter Descriptions (750 words)

Please provide a concise overview of the Primary Emitters. Please also provide the split between industrial / power / hydrogen / GGRs in the emitter base. Please also confirm if there is any co-dependence between emitters; if this is the case please provide a concise explanation of how this impacts the overall emitter volume delivery and the extent to which alternative emitters have been identified to cover this volume delivery risk.

For CO₂ utilisation, please confirm whether CO₂ export to CO₂ users is expected alongside transport and storage. This can be at any point, for example, direct from the emitter or from the transport and storage network.


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3.5.2 Emitter 1 (1000 words)

For each of the Primary Emitter sections please provide a description of each emitter, the stage of their development and the dependencies associated with their delivery.

The description of each emitter should include reference to appropriate supporting information to including, but not limited to the following:

Whether the emitter is in operation, construction or development; if in development, at what stage is it at and when is FID programmed / anticipated?

The design life of the emitter project, including the capture facility and overall plant life for any pre-existing plants

The CO₂ capture volumes anticipated, capture efficiency and any associated emissions for the capture plant

The captured and uncaptured CO₂ sources across the whole emitter operational site, including annual CO₂ volumes from these

A description of the capture process including any additional power / thermal energy requirements and the proposed technology type (including the extent to which this is a firm position)

A concise description of the market for the emitters’ product(s) over the proposed CO₂ capture operational period

A description of the market for the emitters’ product(s) and future potential

To what extent the emitter is dependent on future market sales / off-takers or other agreements (e.g., fuel supply) to be able to confirm program delivery dates and volume certainties

Given the developing nature of the Hydrogen market, for hydrogen producers within the cluster please provide the additional information requested below. This is additional to the information requested in the previous questions.

Where details of hydrogen flows are given please provide these in mass flow units and / or MWh (LHV) values.

What level of hydrogen off-take has been agreed, with whom and what agreements are in place to support this?

Where there is uncertainty over volume deliveries and timings please confirm the timeline for firming these up and getting to a contracted position for delivery.

What regulatory requirements need to be met to meet the development timeline?

What is the hydrogen production capacity and to what extent is there flexibility within the production system to tolerate variable off-take; Is there a minimum threshold for hydrogen off-take required?

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.Click or tap here to enter text.




Please see Emitter 1 box for details required.





Please see Emitter 1 box for details required.






Please see Section 3.5.2 for further details. If additional rows are needed, please add them into the table below.If additional rows are needed, please insert them into the table below.


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3.6 Expansion phases (2000 words)

This section is to describe how the capacity of the overall cluster system will be increased to accommodate future volumes beyond 2030.

3.6.1 Expansion of emitters

Please provide a concise description of additional emitters expected to be online after the beginning of 2030 or for which an MoU has not yet been executed yet. Please include a description of the uncertainty around these future emitters in terms of execution, offtake market, volumes, costs and capture efficiency.


3.6.2 Expansion of stores

Please provide a concise description of future stores anticipated to be brought onstream after the beginning of 2030. Please include a description of type of store, location, appraisal requirements, licensing/permit requirements, capacity, store initial and final pressures, maximum injection capacity over time, and number of wells. For all stores anticipated to be in operation during the cluster life please describe current expectations on pressure management.


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3.6.3 Expansion of offshore transportation and injection facilities

Please provide a concise description of any changes or additions to the offshore CO₂ transportation and injection facilities expected to take place after the beginning of 2030. For infrastructure that will be existing at the beginning of 2030 please state any expected changes in operating parameters. For new infrastructure such as new pipelines, new manifolds and additional offshore processing please provide a description detailing the design, capacity, operating conditions, costs and anticipated timing of these expansion phases.


3.6.4 Expansion of onshore transportation

Please provide a concise description of any changes or additions to the onshore CO₂ transportation infrastructure expected to take place after the beginning of 2030. For infrastructure that will be existing at the beginning of 2030 please state any expected changes in operating parameters. For new infrastructure such as new pipelines, additional compression or pumping and additional processing please provide a description detailing the design, capacity, operating conditions, costs and anticipated timing of these expansion phases.




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4. Credibility

Credibility is a critical factor within the assessment such that the information provided within this section will be used throughout the assessment of the specific criteria.

4. Credibility

4.1 Cluster execution plan (1000 words)

In this section, please describe how the cluster intends to execute the overall cluster and individual projects including the development and engineering stages. This should concisely describe the envisaged contracting strategy and the governance structure. Please provide a concise explanation of any aspects of the cluster execution that apply novel construction / installation techniques.

Please provide a concise description of the Commissioning Plan and the key risks and uncertainties identified for the commissioning phase of the project.

Please also highlight key risks and uncertainties for the cluster execution phase and their potential to impact on project CAPEX and schedule.




4.2 Risk Management (1000 words)

In this section, please provide a concise description of the approach to cluster-wide Risk Management including the interactions with emitter projects and, where the transport and storage elements are being delivered by different parties, interactions across the transport and storage system.

To the extent that there are differing risk management approaches, these should be described alongside a clear description of how the differing approaches are being integrated at the cluster level. Please provide a concise description of all the major risks to the cluster project (including emitters) and how are they going to be mitigated.

Please provide and reference separate cluster-wide cross-chain, T&S and emitter projects

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risk registers. If the cluster-wide register is unavailable please provide a clear statement on how these will be structured, when they will be available and how the uncertainties are currently being managed. The separation of construction and operation phase risks would be preferable.

The risk registers should include:

Risks for all elements of the cluster and cross chain risks, including interface risks and details on risk owners

Mitigations and how they will be managed alongside estimated mitigation costs

Identification of risks that cannot be transferred to contractors or insurers or others

Probability estimates both pre and post mitigation

Three-point (high, low and most likely) impact estimates for cost and schedule impacts for both pre and post mitigation

Identification of any schedule activities that are impacted by the occurrence of each risk. Activity ID’s included in the risk register

Any significant residual safety risks

Highlight cluster innovation risks and mitigations – overlap with Learning and Innovation criterion

Main storage site risks assessment covering injection rate, storage capacity and containment.

Below are some key risks that the clusters may need to consider:

If re-use assets cannot be re-used after further assessment

Insolvency of key suppliers

Contractor interfaces

Delays or cancellations of emitter projects – stranded asset risk

Closure/bankruptcy of upstream emitter – leaving capture plant as stranded asset

Underperformance of capture plant, reducing volumes of CO₂ entering T&S

Low availability/high downtime of capture plant, reducing volumes of CO₂ entering T&S and resulting in greater intermittency

Low load factor for power sector emitters, reducing volumes of CO₂ entering T&S and resulting in greater intermittency

Covid-19/Pandemic/Epidemic external risks

Force majeure events

Right-sizing of the T&S network and particularly late changes in design to accommodate new flow volumes

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Limited design experience, codes and standards for CO₂ network of this size

Regulatory risks for new technology or processes, for example,hydrogen – natural gas blending or other novel processes

Significant failure or damage to the offshore pipeline during construction/commissioning

Significant failure or poor performance of the storage site compared to design/as expected

Delays in obtaining DCOs and Storage Permits

Workforce availability

To increase our understanding of the projects and their credibility, the inclusion of an opportunity register alongside the risk register would be beneficial for the assessment.




4.3 Operating philosophy (750 words)

In this section, please explain who will be responsible for operating and maintaining the cluster, T&S network and emitters – individually and as an integrated whole (where relevant).

This should include a description of who will be responsible for the operation and maintenance of the different parts of the cluster; how the emitters and T&S network are to be controlled; the extent to which any operations are to be contracted to a duty holder and how many roles are required to operate the cluster.

Please describe the levels of redundancy in the T&S network and emitter designs including the overall design availability of the T&S network and individual emitters.

Please provide a concise description of the assumptions that have been incorporated into the operating expenditure estimate. This should confirm the level of uncertainty related to these assumptions and the extent to which any specific risks identified could require additional CAPEX or OPEX during operations to manage.

Reference to specific activities in the cluster programme to support the descriptions provided would be helpful.

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4.4 Stakeholder engagement (750 words)

Please provide a description of how the project is identifying and engaging with key stakeholders (such as adjacent property owners, local communities, fishing or shipping industries) during project execution, operation and post-cessation. This should include a description of the Cluster’s approach to developing and maintaining co-operation with key stakeholders to assure successful delivery. Reference to specific related activities in the Cluster delivery programme would be helpful.




4.5 Health, Safety and Environment

4.5.1 Health and Safety (1500 words)

Please provide a concise description of the work that has been performed to demonstrate that all residual project and Health and Safety risks to staff, contractors and the local population during project development, execution, operational and post-cessation phases are as low as reasonably practicable?

Please also describe the systems, processes, and governance in place for Health & Safety Management. Please detail the health and safety indicators monitored at Board level and their current status against targets.


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4.5.2 Environmental (1000 words)

Please provide a concise description of the environmental impact of the cluster during the project execution, operational and post-cessation phases covering emitters, onshore and offshore. Please also provide a concise description of the further work required to prepare the necessary Environmental Statement(s) for the full cluster chain.

Please provide a concise description of the extent to which the environmental consenting and permitting activities aligned across the cluster chain (i.e., emitters, onshore, offshore and storage).

Please also describe the systems, processes, and governance in place for Environmental Management. Please detail the environmental indicators monitored at Board level and their current status against targets.




4.6 Supply chain

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4.6.1 Supply chain planning (1000 words)

Please provide a concise explanation of the assessment of the supply chain, labour and skills needed to support the proposed delivery timescales for the project and any identified gaps. This should include:

A description of the key uncertainties linked to the supply chain, the consequential uncertainty in project costs and timelines, and when the uncertainty is expected to be resolved

A description of the key risks linked to the supply chain and how these will be managed

A description of the challenges anticipated and the associated potential mitigations / solutions to these

Reference to specific related activities in the cluster delivery programme would be helpful.

Please also confirm the cluster and project developers will follow best practice in sourcing of labour and materials.


4.6.2 Supply chain engagement (1000 words)

Please provide a concise explanation of the extent of the Supply Chain Engagement, including which parts of the supply chain have been engaged with. Please also provide a description of the current view of capability and capacity and how any associated challenges are going to be addressed.

Please detail the extent to which technology licensors been engaged with for items such as CO₂ compressors, carbon capture technologies and other long-lead items. Please describe what agreements been entered into with third parties and their scope; please also confirm what preliminary studies have been performed.

Reference to specific related activities in the cluster delivery program would be helpful.



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4.7 Financial and Commercial

4.7.1a Business plan and financial health – company level (750 words)


Describe how your company business plans and industrial output have been impacted by events since the start of 2020? What is the outlook for the company out to 2030? Describe how the project aligns with the company’s overall strategic ambitions in the UK to 2030 and beyond?

Please provide copies of the latest two sets of filed accounts (and any accompanying report) for the following companies where applicable:

The company or companies operating the project

The company or companies financing the project

The company or companies responsible for key investment decisions in relation to this project

The group parent company or companies (e.g., consolidated accounts)

Please confirm that accounts for the above entities have not received a qualified audit report in any of the previous five years. Highlight any areas of material uncertainty raised by auditors in this period.

Please confirm if the corporate group currently has any financial obligation to HMG and provide details where applicable.




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4.7.1b Business plan and financial health – company level (750 words)






4.7.1c Business plan and financial health – company level (750 words)






4.7.1d Business plan and financial health – company level (750 words)



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4.7.1e Business plan and financial health – company level (750 words)






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4.7.2a Financing plan – Project level (1000 words)

Note: A response is expected for each individual T&S or capture project within a cluster. In the event of multiple participants in a particular project, we would expect to see a single overarching financing plan and for it to be clear how each participant fits into that.

Please describe the proposed financing arrangements for progressing each project within the CCUS cluster. Your response should distinguish between different stages of the project and explain what is needed to achieve a final investment decision. Within your answer, please provide the timeline, dependencies, key risks and mitigations for the financing process. Please also detail the assumptions underpinning the financing plan including key ratios.

If the project will be financed by intragroup financing or external debt arrangements that already exist, then please provide a summary of those arrangements. Your summary of the debt arrangements should reference any factors that are material to the financing e.g., headroom, duration, security, and covenants.

If new capital needs to be raised then set out the type of finance anticipated, the level of market engagement that has taken place, feedback received, as well as the activities and timescale needed to secure the financing.

Please summarise the status of key agreements needed to realise the project and the plans to finalise them e.g., shareholder/sponsor documents, loan and security documents, and project documents. Include major milestones, dependencies, key risks, and mitigations. Include agreements between cluster parties as well as key supply chain partners and off-takers, where appropriate.




4.7.2b Financing plan – Project level (1000 words)



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4.7.2c Financing plan – Project level (1000 words)






4.7.2d Financing plan – Project level (1000 words)






4.7.2e Financing plan – Project level (1000 words)



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4.8 System Integration

4.8.1 Specification of capture gas (1000 words)

Please provide the specification for the CO₂ entering the T&S system including all components. This should include technical details of the phase envelope for this gas composition and a concise description of the impact of variation of this specification on the overall system.

Please also provide a description of the extent to which this specification causes an increased processing burden for the emitters and the extent to which the system can handle off-specification gas both in the short-term and on a longer-term basis; including any time limitations to off-specification events.

To what extent is there uncertainty in the achievable specification for the costs presented to date? What would the cost / schedule impact of a tightening or loosening of the CO₂ entry specification be for the T&S network and which components will have the greatest influence on these?


4.8.2 Flow assurance and system operating parameters (1000 words)

Please provide a concise description of the key system operating parameters for the initial and each expansion phase. This should demonstrate the feasibility of the proposed system configuration with reference to and highlighting the flow assurance scenarios considered.

Please provide a concise description of the operability of the proposed scheme. This should include a description of the key risks and uncertainties associated with the operation of the system based on the current level of understanding of the system flow assurance. Please also define the minimum turndown and the system’s ability to manager rapid fluctuation in pressures and volumes entering from emitters.

Reference to risks within the risk register would be helpful.

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4.8.3 CO₂ metering (500 words)

Please describe the CO₂ metering across the chain, explaining what the metering will be used for, the accuracy level(s), metering methodology and standards used. Where will the CO₂ be metered for fiscal purposes and custody transfer? Will there be additional metering for flow monitoring, or will virtual flow metering or modelling be used?




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5. Deliverability

The deliverability criterion will consider the cluster’s capability and capacity to deliver its projects successfully and the timeline on which the cluster and associated capture projects will come online. The deliverability criterion contributes 30% to the final cluster score.

5. Deliverability

5.1 Schedule: Level 1 integrated cluster schedule (1000 words)

Please provide an integrated Level 1 schedule for the cluster including the development of both the Primary Emitters and T&S network. This should show when individual emitters come onstream, activities related to any expansion projects and any key milestones such as: planning, consents, decisions gates, FID etc. Please also confirm dates for CO₂ being available from emitters, at the well head and being stored.

Please provide a concise description of the schedule’s critical path with reference to important parts of the Level 2 plan that the critical path is dependent on. Please reference to a separate fully logic linked Schedule in native file format - Primavera P6 (XER) or MS Project (XML/MSP) which is required. This should be at least Level 2 detail, fully logic linked, integrated across the chain including critical path and float. Ideally this will be costed and resourced.

We recognise different projects are at varying degrees of development, so please also provide credible emitter project schedules at the greatest level of detail currently available that is supportable with evidence.

Please describe areas of uncertainty in the schedule: if possible, please present the Base schedule with uncertainty ranges around individual activities and identify the key risks that could expand these ranges further.

Reference to separate ‘What if’ scenarios or Quantitative Schedule Risk Analysis of the schedules would be beneficial to increase confidence of deliverability within a given time. Reference to a separate high-level cluster commissioning plan to demonstrate how the cluster will manage and coordinate the commissioning of the cluster from the emitters through the T&S chain elements to the final storage sites would also be beneficial.


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5.2 Planning and Consents (500 words)

Please provide a description of the status of the planning and consents for the store, the onshore pipeline, the offshore pipeline and the emitter projects that are expected before 2030. This should include a concise description of the status of the storage permit.

Please ensure that you highlight areas of risk and uncertainty surrounding planning and consents that could increase the durations or require design modifications to achieve approvals.

Reference to a separate Planning and Consents Register would be helpful. We would anticipate planning and consent risk being an intrinsic element of the overall cluster risk register.




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6. Emissions reduction

The emissions reduction criterion will assess the potential offered by each cluster to generate reductions in CO₂ emissions. The emissions reduction criterion contributes 25% to the final cluster Score.

We further divide and sub-weight this into three sub-criteria.

CO₂ abatement volumes to 2030 (60%)

Potential for future abatement beyond 2030 (30%)

CO₂ intensity of infrastructure (10%)

6. Emissions Reduction

6.1 Stored volumes to 2030 (500 words)

Please provide the requested inputs for the emissions stored volumes in the Levelised Cost Model in Annex C.

Please provide a concise description of the stored volumes before 2030 by the Primary Emitters. Please include any key uncertainties in the emissions profile and key risks that could occur due to reduced capture volumes or result in non-materialisation of an emitter project. Please reference the risk register where appropriate.


6.2 Potential for future abatement beyond 2030 (750 words)

Please describe the cluster’s plans for future abatement of emissions beyond 2030. These plans could consider the development of additional stores, expansion of existing stores by means of pressure management, increasing T&S network capacity and availability, additional capture projects or future shipping capabilities.

Please provide a concise description of the key uncertainties in the stored volumes profile and both captured and uncaptured emissions as well as the key risks that could occur to reduce captured or stored volumes or result in non-materialisation of an emitter project. Please reference to the risk register where appropriate.

Please also provide the cluster’s long-term captured and stored volumes in the Levelised Cost Model in Annex C, including those emitters and T&S expansions after 2030.


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6.3 CO₂ Intensity (500 words)

This sub-criterion is an in the round measure of the emissions generated by the cluster as a result of construction, operational and decommissioning activities when compared against the volume stored. Scoring of this criterion will consider carbon intensity of Primary Emitters and T&S emissions, T&S availability and how the cluster is reducing its own emissions.

Please describe the carbon intensity of the overall cluster, individual emitters and the T&S system. Please include details of the overall cluster CO₂ abatement referencing detailed calculations and any standard methodologies that have been used in estimating embedded and operational emissions.

Please describe how the project is ensuring that emissions from construction, operational and decommissioning phases of the projects are as low as is economically possible, making reference to any standards, guidelines or policies followed by the cluster to this end.




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7. Economic benefits

The economic benefits criterion aims to assess the potential contribution that the cluster can make to government’s objective of supporting clean, resilient and sustainable economic growth as we build back from the impacts of Covid-19. The economic benefits criterion contributes 20% to the final cluster Score.

We further divide economic benefits into three sub-criteria which will be scored in aggregate:

Direct economic benefits, which we define as benefits relating directly to the developer’s own activity, and/or the activity of primary contractors.

Indirect economic benefits, which we define as benefits relating to the remaining supply chain, outside of the developer and its primary contractors.

Induced economic benefits, which we define as the wider economic benefits that are brought about by the development and operation of the cluster in that local area.

7. Economic Benefits

7.1 Direct economic benefits (Template and 500 words)

The assessment of direct economic benefits will be mostly considered through the information outlined in the Economic Benefits Template (Annex B); please complete the form to provide the jobs and skills information. Applicants should provide any clarifications or assumptions within the box below and reference any supporting evidence.


7.2 Indirect economic benefits (750 words)

Please input the indirect job and skills data into the Economic Benefits Template (Annex B). Please also describe how the cluster:

Plans to develop regional skills and capabilities to ensure the skills are in the appropriate location to support delivery of the Cluster Plan.

Plans to ensure all possible suppliers, including SMEs, are aware of future work projects and can tender for such work.


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7.3 Induced Economic Benefits (750 words)

Please describe how the cluster has the potential to deliver induced economic benefits as described in the Launch Document. Clusters should also consider how the induced economic benefits align with the strategic priorities outlined below:

Synergies with other decarbonisation programmes and potential to be a ‘SuperPlace’.

Regeneration and community renewal

Equality and inclusion

For further description of these strategic priorities please refer to the Launch Document.




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8. Cost considerations

Through the cost considerations criterion, BEIS will seek to determine a Levelised Cost of Abatement (LCOA) across the whole cluster proposal. Please provide information within the LCOA template (Annex C) and answer the question below.

The cost considerations criterion contributes 15% to the final cluster Score.

8. Cost considerations (Template and 1000 words)

This section is focused on understanding the overall cost of the project including the cost of storage, Primary Emitters, future projects, right-sizing of the T&S network for future volumes, remaining cost uncertainty and financing costs.

Please provide a summary of the cluster costs including expenditure to date, CAPEX, OPEX and decommissioning costs by cluster project. This should include the level of estimates, benchmarking, accuracy, contingency applied and any grants that have been awarded to date. For decommissioning costs include post-cessation of injection OPEX and for re-use assets outline the assumed split of costs borne by the cluster and those borne by previous owners of the assets. Please also provide justification for any contingencies that have been applied.

The Levelised Cost of Abatement Model within the Cost Template (Annex C) should be populated and referenced in this section to enable evaluation and support the descriptions provided.

Please describe the level of uncertainties and risks that have been identified that could affect the CAPEX and OPEX estimates (either as a cost increase or reduction). This should clarify which uncertainties and risks will be reduced or eliminated before FID. Providing specific references to the cluster risk register(s) would be helpful.

Please provide a summary of the costs that have been assessed to cover the event where re-use assets are found to be unsuitable for use as part of the T&S system. This is likely to include a high-level cost estimate of a worst case where there is replacement with all new assets and the rationale for these costs (i.e., design basis, benefits etc). Please also provide a description of how this is addressed within the cluster Risk Register.




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9. Learning and innovation

This criterion assesses the production and sharing of learnings from cluster development which will be a crucial step in reducing future costs and de-risking projects for future rounds of CCUS deployment. The sharing of information will also promote innovations and collaboration both within and between clusters. The learning and innovation criterion contributes 10% to the final cluster score.

9. Learning and Innovation (2000 words)

9.1 Diversity of applications

Please describe the portfolio of capture applications within the Primary Emitters. Clusters should draw out different capture applications (power, industry, hydrogen, GGRs) as well as any variety within capture applications (for example, different types of industrial emitters or sector or different types of hydrogen off-taker). Please also outline any plans to incorporate the shipping of CO₂ within the cluster.


9.2 Cost reduction, Replicability, and Innovation

This section is seeking information on the potential benefits to subsequent CCUS projects. Describe the innovative aspects of the cluster design (capture projects, transportation and storage), what technology maturation is required for these innovations and what future cost reductions are expected from them. How replicable are these innovations for future CCUS projects in the UK and globally?


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9.3 Knowledge sharing plan

Please how the cluster will generate, disseminate, and promote new knowledge and best practice, including how the cluster will drive delivery partners to share information. These plans should describe how the cluster will share knowledge with different stakeholders including local and national institutions to ensure maximum benefit of the learnings gained.

Please also provide a list, or separate document, of the Key Knowledge Deliverables (KKD) that will be shared either in full or redacted as appropriate.


9.4 Synergies with other decarbonisation initiatives within the region

Please describe how the projects involved will realise and add to synergies with other decarbonisation initiatives within the region such as Hydrogen for Heat trials or green transport hubs. Please detail the steps the cluster will take to achieve these goals.


9.5 Contribution to UK hydrogen targets

Highlight the contribution of the cluster to the UK government’s Hydrogen ambition of 1 GW of hydrogen production capacity by 2025 and 5 GW by 2030. How is the cluster enabling the development of Hydrogen in the UK?




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This publication is available from: www.gov.uk/government/publications/cluster-sequencing-for-carbon-capture-usage-and-storage-ccus-deployment-phase-1-expressions-of-interest

If you need a version of this document in a more accessible format, please email [email protected]. Please tell us what format you need. It will help us if you say what assistive technology you use.


https://www.gov.uk/government/publications/cluster-sequencing-for-carbon-capture-usage-and-storage-ccus-deployment-phase-1-expressions-of-interest

https://www.gov.uk/government/publications/cluster-sequencing-for-carbon-capture-usage-and-storage-ccus-deployment-phase-1-expressions-of-interest

Documents

Cluster Plan introduction - assets.publishing.service.gov.uk · Web viewThis document sets out the questions that clusters should answer as part of their Cluster Sequencing submission