THE Government was last night accused of delivering “another kicking for Teesside” after it reneged on manifesto pledges to support clean air schemes.

A £1 billion competition to develop carbon capture and storage (CCS) technology has been axed.

The shock decision means the competition, which had two bidders - the White Rose scheme in Selby, North Yorkshire and the Peterhead scheme in Scotland, are shelved.

It also threatens the Teesside Collective plan to develop Europe’s first ever CCS network, that would capture air pollutants produced by the region’s heavy industry. Last week Tees MPs urged George Osborne to help fund the next stage of the revolutionary scheme.

Teesside Collective say it could help safeguard chemicals and steel jobs and create 2,600 jobs across Tees Valley over the next 20 years.

Last night, Stockton North MP Alex Cunningham said the Government decision represented "another kicking for Teesside and our industrial scheme."

Neil Kenley, director of business investment at Tees Valley Unlimited, said on behalf of Teesside Collective: “With carbon permits expected to quadruple in price by 2030, CCS is also the only sure fire way of retaining a competitive industrial base in the UK.

"Exempting energy intensives from climate change policy costs is helpful, but can only ever be a sticking plaster for reducing uncertainty, in the face of the challenge of climate change.”

“This is devastating,” said Luke Warren, chief executive of the CCS Association. “Moving the goalposts just at the time when a four-year competition is about to conclude is an appalling way to do business.

"It is a real blow to confidence for companies investing in CCS. This technology is critical for the UK’s economic, industrial and climate policies.”

Shell said the Peterhead project was now dead and its CCS work would be focused in other countries.

In its 2015 General Election Manifesto, in the section headlined: ‘We will protect our planet for our children’ the Conservatives said: “We have been the greenest Government ever…committing £1 billion for carbon capture and storage.”

Lisa Nandy, Labour’s shadow energy secretary, said: “CCS offers huge economic opportunities for Britain. Year after year the Prime Minister has personally promised to support CCS, so this is a huge betrayal.”