E.ON, one of the UK's leading power and gas companies, has called for the Government's forthcoming coal consultation to identify sufficient incentives for companies developing carbon capture and storage (CCS).

Providing such incentives are put in place, the company has also committed to fit the pioneering technology to its proposed coal units at Kingsnorth power station.

Speaking at the Adam Smith Institute's Future of Utilities conference, E.ON UK Chief Executive Paul Golby outlined the company's ongoing investment plans for carbon capture technologies and welcomed the Prime Minister's support for CCS investment at the Lancaster House nuclear conference.

He said: "We are very supportive of the Government's decision to consult on this important issue and are urging them to come forward with the right policy that will allow companies like E.ON to develop critical CCS technology.

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"We have effective policies on nuclear and I think we're moving in the right direction on renewables, although we need to go further.

"We hope that this consultation will lead to an effective fossil fuel policy that removes the existing financial penalty for deploying CCS.

"So, while we at E.ON will continue to invest tens of millions in vigorously pursuing our ambitious CCS development programme, we need to see a similarly vigorous approach to developing the financial incentives that need to be in place if we want to invest faster than the carbon market will dictate.

"What we are saying today is that the time is right to urge the Government to do what is necessary. Let us complete the technical development of CCS while you fund the difference between abated and unabated fossil."

The company also announced the start of field work to identify potential carbon dioxide (CO2) pipeline routes in Kent.

The survey work aims to find the best locations for the pipelines that could eventually be used to carry captured CO2 from the proposed cleaner coal units at Kingsnorth to North Sea gas fields for storage.

"This is an important step in developing the options for CCS development at Kingsnorth and, subject to us achieving a positive decision on our planning application, is another indication of E.ON's commitment to completing the development of CCS," said Dr Golby.

"We remain committed to the Government's CCS demonstration competition which is a great start but what we desperately need now is action.

"Progress to date has been too slow and I very much hope to see signs of movement soon, which is why we've decided to push forward with developing options for our own project."

(CD/JM)