Plans for a £3 billion clean coal power station creating 4,000 jobs near Hatfield Colliery could still go ahead, MPs have been told.
The firm behind the project says it is optimistic it will find private funding to keep the scheme on track, despite the Government deciding not to put money into it.
The project looked set to collapse last year after the Government rejected it from its £1bn funding competition for carbon capture and storage projects without explanation, provoking fury in Doncaster.
Former Hatfield Colliery owner Richard Budge proposed the scheme to provide a market for the mine’s coal.
The Government instead put money into a similar carbon capture project called White Rose Carbon Capture and Storage sproject, centred on Drax Power Station near Selby.
The Hatfield project, which was forecast to create 4,000 jobs if if gets off the ground, had already won £160 million from the EU and been picked out by officials in Brussels as the best proposed CCS scheme in Europe.
Jane Paxman, director of the firm behind the scheme, 2CO, said it was still hopeful of attracting the cash required to get the scheme off the ground, even without the £1bn grant from the Government.
She told MPs on the House of Commons energy committee: “We’re making a go of it on our own.
“We have to find ways of progressing without access to the (DECC) capital grant.
She said the firm was fortunate it still had access to the European Union grant.
She added: “That helps us through the stage where there are many 10s of millions of pounds needing to be spent prior to the final investment decision. That’s been of enormous benefit to us.”
She said the viability of the Hatfield scheme is now dependent upon ministers agreeing a suitable level of annual subsidy for the project.
The Government has announced future subsidies for other types of green energy schemes, such as offshore wind, but not yet for carbon capture.