£22bn for UK carbon capture schemes

Rachel Reeves is paving the way for a multibillion increase in public sector investment at the budget after the government announced plans to commit almost £22bn over 25 years to fund carbon capture and storage projects.

- Richard Partington, Jillian Ambrose

In what is expected to be one of the biggest green spending promises of the parliament, the chancellor, the prime minister, Keir Starmer, and the energy secretary, Ed Miliband, will announce the details of the plan on a visit to the Liverpool city region today, declaring a "new era" for clean energy jobs.

With less than a month before the 30 October budget, the chancellor said the announcement would come as one of a "drumbeat" of measures to show that the new government would prioritise investment to kickstart economic growth.

The government hopes the investment will reignite Britain's struggling heavy industry by funding two major carbon capture and storage (CCS) clusters - one in Teesside in northeast England, and a second that will capture emissions in north-west England and north Wales.

The technology is controversial because it has never been used at commercial scale in the UK before, while environmental campaigners have warned big energy firms could use it to extend the life of their fossil fuel assets.

Greenpeace said there was a danger the government was "locking ourselves into second-rate solutions".

However, ministers and officials expect it to play a major role in the government's climate ambitions as a vital way to reach net zero.

The prime minister will say the commitment over the next 25 years had helped to bring in an expected £8bn of private investment by some of the world' biggest energy companies for the carbon capture schemes, including BP and the Norwegian energy company Equinor.