Britain stands to gain more than €1 billion of investment capital from Europe for innovative green energy projects.

Seven British companies dominate the 14 from across Europe that are now bidding for financial support to build carbon capture and storage (CCS) demonstration projects.

The technology, which many consider a vital tool in fighting climate change, involves the removal of carbon dioxide from the fuel burnt in power stations and industrial plants, and its injection into rocks far beneath the North Sea.

Up to €5 billion is expected to be released through the sale of surplus carbon allowances, a resource made possible thanks to a proposal put to EU Prime Ministers through work in 2008 by Tameside Liberal Democrat MEP Chris Davies.

Davies described his success at the time as “the greatest political achievement of his life”.

The funds are expected to be shared between 8 large CCS projects and a number of smaller schemes intended to develop innovative renewable energy schemes. No one country can win more than three in total.

The projects are now being appraised, with the winners to be announced towards the end of next year.

Although Yorkshire is prominent amongst the CCS bidders, the North West is certain to lose out. Initial interest shown by major companies close to the Mersey and Dee estuaries in piping CO2 out to storage sites in depleted Irish Sea gas fields came to nothing.