A MAJOR carbon capture and storage project planned for Teesside could be in line for EU cash.

Teesside Low Carbon (TLC) has ranked fourth in a Europe-wide competition.

It’s unclear how much money will be unlocked by NER300, a programme to lever private investment for low-carbon technologies, but Teesside chiefs are optimistic their project will be a winner.

The amount available for projects depends on how much 300 million allowances (rights to emit one tonne of carbon dioxide) will make on the open market.

The allowances have been set aside from the EU’s Emissions Trading Scheme, in which firms trade the right to emit carbon.

The first wave of 200 million allowances could fetch 1.3-1.5 billion euros, which will lever matched funding for the winning projects from member states and industry.

The heavy-hitting consortium behind TLC needs to raise around £2bn to finance the project, and it’s also still in the running for a £1bn UK-wide programme.

Peter Whitton, managing director of TLC lead company Progressive Energy, said two of the projects ranked above TLC had already received £180m in funding and there was a limit placed on how much one project can receive.

He said: “It’s really quite optimistic, we have put together a good solid bid and came sufficiently far up the tree.”

If it goes ahead, TLC would help safeguard the future of heavy industry in the area by providing a storage solution for the area’s biggest polluters, as carbon taxes begin to bear down.

Carbon produced by its own coal-fired power station, alongside emissions from industry, would be transported along a 250km-long offshore pipeline and stored in a saline aquifer and a depleted oil field in the North Sea.

Projects for the EU fund have been ranked according to their cost-per-unit performance, or how much carbon could be stored.

A spokesperson for the Department of Energy and Climate Change said the outcome of the NER300 would not have any bearing on other funding decisions in the future.