Capturing carbon at Drax: Delivering jobs, clean growth and levelling up the Humber

In November 2019, Drax Group announced its ambition to become the world’s first carbon negative energy company by 2030. To achieve this, it is looking to convert its four existing biomass operations at Drax Power Station to carbon capture and storage (CCS). This technology, also known as BECCS, would generate up to 16 million tonnes of ‘negative emissions’ per year – equivalent to the total industrial emissions from the Humber region today.

Vivid Economics was commissioned by Drax to quantify the social and economic benefit of deploying BECCS at Drax Power Station. Vivid was also asked to provide an estimate for Drax of the socio-economic benefits of deploying CCS and hydrogen technologies at scale across the wider Humber industrial cluster including direct, indirect and induced jobs, identify of gaps in regional skills and investment and propose policy solutions to these gaps, in conjunction with interviews with key stakeholders from regional trade bodies.

Using a combination of a bottom-up direct jobs calculator, Vivid’s proprietary Impact Investment Model, ONS labour market data and interviews, the analysis found that:

  • As many as 49,700 direct, indirect and induced jobs will be created as a result of deploying CCS and hydrogen technologies in the Humber region. Working in partnership with the UK Government, these new jobs could begin to be realised in as little as four years’ time (2024).
  • Developing BECCS at Drax itself would support on average 10,500 direct, indirect and induced jobs per year during construction between 2024 to 2031, peaking at 16,800 jobs in 2028.
  • BECCS at Drax would also generate an additional £370 million on average in direct GVA each year during the construction period (2024 to 2031) – and an additional £170 million per year and £210 million per year in indirect and induced GVA. Total GVA peaks at £1.1bn in 2028.
  • Deploying CCS and hydrogen technologies in the Humber would also deliver a peak of over £3.2 billion per year in direct, indirect and induced GVA in 2027 for the Humber economy
  • A number of different approaches are possible to bridging the growing skills gap in the region: companies and schools should work together to highlight the opportunities of vocational training to school leavers. For older generations of workers who have been out of the labour force for extended periods of time ‘skills vouchers’ are a timely intervention – these work by offering grants to cover the cost of flexibly retraining, meaning long-term unemployed workers of any age can ease back into new types of jobs.
  • At its peak, the Humber and wider UK deployment of CCS and hydrogen technologies could support over 205,000 direct, indirect and induced jobs and almost £15 billion in direct, indirect and induced GVA.

Client

Drax, as part of the Zero Carbon Humber consortium

Sectors:

Cities
Energy
Industry Manufacturing & Mining
Oil & Gas
Transport & Logistics

Capabilities:

Net Zero Transitions
Special Economic Zones
Technology & Innovation

Regions:

UK

Products:

IIM