Government signs contracts for two carbon capture and storage (CCS) plants in cement and waste-to-energy sectors.
Projects expected to capture 1.2 million metric tons of CO2 annually and create 500 skilled jobs.
Part of Britain’s £9.4 billion ($12.65 billion) funding pledge for CCS over the current spending review.
London greenlights flagship CCS contracts
Britain has signed contracts for two commercial-scale carbon capture and storage (CCS) projects, a step aimed at curbing emissions from some of the country’s most energy-intensive industries while generating 500 skilled jobs. The government confirmed Thursday that the agreements cover Heidelberg Materials’ Padeswood cement works in north Wales and Encyclis’s Protos waste-to-energy plant in Ellesmere Port, northwest England.
Together, the projects are designed to capture 1.2 million metric tons of carbon dioxide a year. Emissions will be transported by pipeline and permanently stored under the seabed through Eni’s Liverpool Bay storage project.
Cement and waste-to-energy in focus
The UK government has made clear that CCS must be deployed at scale if the country is to meet its legally binding target of net-zero emissions by 2050. Cement and waste-to-energy plants are among the hardest sectors to decarbonize, where electrification or fuel switching cannot fully eliminate carbon output.
Heidelberg Materials said its investment would create the world’s first carbon capture facility enabling fully decarbonised cement production. Construction is set to begin later this year, with the company aiming to produce its first net-zero cement in 2029.
“Our constructive partnership with the UK government has allowed us to reach this major milestone, which is fantastic news, not just for us, but for the industry as a whole,” said Simon Willis, CEO of Heidelberg Materials UK.
Encyclis’s Protos project will integrate CCS with waste-to-energy, a sector that has faced mounting scrutiny over its emissions profile. By capturing and storing carbon from waste combustion, the facility is positioned to demonstrate how residual waste can be managed while contributing to climate targets.
Financing CCS at scale
While the government did not disclose the value of the contracts, the projects fall under Britain’s £9.4 billion ($12.65 billion) allocation for CCS technology announced in June. The funding is intended to accelerate deployment in industrial clusters, de-risk investment, and attract private capital into projects that have historically struggled due to high upfront costs and uncertain revenue streams.
CCS technology has been commercially available for decades, but projects worldwide have often stalled over economics. Britain’s contracts are designed to address this gap by providing revenue certainty for developers, while tying the projects into regional decarbonisation plans.
The Liverpool Bay storage hub, operated by Italy’s Eni, is a central component. By creating shared transport and storage infrastructure, the government aims to lower barriers for multiple emitters to link into the system, reducing duplication and costs.
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Strategic and political stakes
For London, backing CCS carries both industrial and political weight. The projects are expected to support regional employment while preserving the competitiveness of UK-based manufacturers under tightening global climate regulations. The government estimates up to 50,000 jobs could be supported across the wider CCS value chain by 2030 if deployment expands.
The UK is also positioning itself as a leader in CCS at a time when Europe is racing to establish cross-border carbon storage networks. The EU has set a target of capturing 50 million tons of CO2 annually by 2030, while Norway’s Longship project has already begun construction. Britain, no longer part of the EU, is signaling its intent to compete for industrial investment and global relevance in climate technologies.
What executives and investors should note
For executives in hard-to-abate sectors, Britain’s latest contracts mark a precedent for how governments may bridge the cost gap on CCS. The use of industrial clusters with shared transport and storage is emerging as a model to cut costs and create certainty for private developers.
Investors will be watching whether Britain’s support translates into scalable returns and replicable business cases. For policymakers, the projects highlight the need for stable, long-term frameworks. Without them, CCS could remain constrained to pilot projects rather than the scale needed to materially affect emissions trajectories.
Global significance
Britain’s decision comes at a time when the International Energy Agency has said global CCS capacity must expand more than thirty-fold by 2030 to align with net-zero scenarios. For governments weighing industrial competitiveness against climate obligations, the UK’s contracts are being closely studied as a test case for whether public spending can unlock durable private-sector investment in CCS.
If successful, the Padeswood and Protos projects could provide a template for other countries seeking to protect heavy industry while cutting carbon. For global business leaders, the message is clear: CCS is moving from concept to contracted delivery, and the economics of participation may shift rapidly as policy frameworks mature.
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