ANALYSIS-Govt snub kills UK coal-fired power plans

By Daniel Fineren

LONDON, Oct 10 (Reuters) - A new breed of clean coal fired power plants may never get built in Britain, companies say, after the government ruled them out for cash help in favour of those using another technology.

The British government on Tuesday refused to give money to a number of "clean" coal plants hoping to win a competition for hundreds of millions of pounds in funding.

Only those plants which could remove carbon dioxide after coal is burnt in power plants and then safely bury it underground will be in the running for the carbon capture and storage (CCS) prize.

Unless rival project backers can persuade the government to change its mind over the next few weeks, proposals for removing the carbon dioxide before fuels are burnt using IGCC technology are unlikely to go ahead because the pioneer projects are likely to be expensive.

The UK arm of German energy giant E.ON EONG.DE, had hoped to win support for its CCS project at Killingholme in northern England. But the government's rejection of any pre-combustion project is the end of it.

"It does effectively kill off the Killingholme project," a spokesman for E.ON UK said.

E.ON is still in the running with its plan for a "clean" coal plant at its Kingsnorth power station in Kent, which was invaded this week by environmentalists opposing plans for a new coal-fired plant.

Centrica (CNA.L) has not yet ditched its plan to build a billion-pound coal plant in northeast England to remove the gas primarily responsible for climate change and then stash in underground before burning the coal.