Paul Golby, Chief Executive of E.ON UK said: This is a vital step by the Government that recognises the critical role that carbon capture and storage will play in decarbonising the UK and, if we can lead the way as a nation, the world.

That is why E.ON is committing today to fit capture technology to Kingsnorth in accordance with the Government’s proposed conditions, as long as it is properly funded.

To that end, we propose that the CO2 from Kingsnorth should be captured and then stored as part of a ‘Thames Cluster’ that supports the whole of the South East, the highest energy using region of the UK.

Following its own technical review of the potential for carbon clusters in the UK, E.ON believes that the best way forward for the development of CCS would be to link a number of fossil-fired power stations and other industrial sites to a single carbon transportation system.

This approach would effectively ‘future proof’ the development of CCS by allowing new facilities to connect quickly to a pipeline that would work much like the existing national grids for gas supplies and for electricity transmission.

Work also started last month on identifying potential routes to connect Kingsnorth to the proposed pipeline system that would carry captured CO2 to the Hewett gas field in the southern North Sea.

Today’s statement and yesterday’s Budget show that the Government has clearly realised we’re at a tipping point with energy policy – if the energy industry and the Government get it wrong we face power cuts and irreversible climate change. If we get it right then we can look forward to a secure, low carbon energy future for the UK, said Dr Golby.

We believe the Government is right to increase support for cleaner coal through carbon capture and storage and for offshore wind, alongside its commitment to new nuclear. We have plans in place to deliver each of these. The Government must now urgently set out the roadmap that draws all this together.