The decision will balance the UK’s low carbon ambition with the need to ensure taxpayer’s money is invested in the most effective way.
The government will utilise the amount for new projects, for which bids from Scotland and England are expected.
Once the selection process for further CCS projects is published, the government will set out a long term vision for CCS deployment along with an industry action plan.
Secretary of State for Energy and Climate Change Chris Huhne said that the government was not able to reach a satisfactory deal for a project at Longannet and has decided to pursue alternative projects.
