UPDATE 1-EU recommends winners of CCS project funding

Fri Oct 16, 2009 10:02am EDT

* EU proposes 6 projects for up to 180 mln euros each

* Final list of winners to be published mid-November

BRUSSELS/LONDON, Oct 16 (Reuters) - The European Union's executive Commission recommended the winners of EU funding for projects demonstrating capture and storage technology to the European Parliament on Friday, an EU Commission document showed.

The first commercial-scale coal plants to be equipped with the technology, viewed as an important weapon in combating climate change, will be built in Germany, the Netherlands, Britain, Poland, Spain and Italy.

The EU Commission recommended to the EU Parliament that five of the six schemes are awarded an initial subsidy of 180 million euros ($268.6 million), with the same sum coming from national governments.

The Italian project will receive 100 million euros.

The recommended winners include Vattenfall's VATN.UL Oxyfuel project in Jaenschwalde, Germany, the Rotterdam Hub scheme in the Netherlands, a Polish project in Belchatow, Powerfuel's Hatfield project in Britain, Endesa's (ELE.MC) OxyFuel project in Compostilla, Spain, and Enel's (ENEI.MI) scheme in Porte Tolle, Italy.

The EU Commission described all the projects as "very good."

Carbon capture and storage (CCS) captures the main greenhouse gas carbon dioxide from a power station and stores it underground to prevent it from entering the atmosphere.

The EU Parliament has four weeks to raise objections and the final list of winners will be published in mid-November at the earliest.

The EU has pledged a total of 1.05 billion euros in support for CCS projects from its economic recovery stimulus package.

It aims to have up to 12 CCS demonstration projects in operation by 2015 and to have the technology fully commercialised by 2020.

The world needs to build 100 major CCS projects by 2020 and thousands more by 2050 to help combat climate change, the International Energy Agency said on Tuesday. [ID:nLD718024]

Energy ministers meeting in London said the world must start building by next year at least 20 commercial-scale pilot projects to test a technology which U.S. energy secretary Steven Chu said could solve "20 percent of the problem" to curb carbon. For a factbox on planned CCS projects in Europe, click on [ID:nLE518460] (Reporting by Nina Chestney and Peter Harrison in Brussels; Editing by James Jukwey)

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