Construction of coal-fired power stations should be banned until their carbon dioxide emissions can be captured for safe storage, a government-funded agency has told ministers.

The recommendation by the Environment Agency is a setback for Germany’s E.ON, which wants to build a coal-fired plant at Kingsnorth, Kent.

Lord (Chris) Smith, chairman of the Environment Agency, described any attempt to build such plants without carbon capture and storage (CCS) technology as unsustainable.

His intervention intensified pressure on John Hutton, the Secretary of State for Business, who has to decide whether the plant should be approved.

Supporters of E.ON point out that Britain faces an energy shortage from 2015 as stations reach the end of their lives. Without new plants, they argue, extensive power cuts are likely.

Lord Smith, responding to the Government’s public consultation on CCS, said: “Building a new generation of coal-fired stations without capturing the carbon emissions would lock the UK into using high-carbon technology for decades to come. This is not an environmentally sustainable way of generating power given the challenges we face with climate change.”

He maintained that even making sure Kingsnorth is built so as to be ready for CCS as soon as it is available would be wrong because of the scale of the challenge the world faces in bringing down emissions.

Lord Smith acknowledged that CCS technology is under development and said there is “an urgent need” for it to be demonstrated on a commercial scale. “Coal-fired stations will for a considerable time continue to be a significant part of global energy supply,” he said. “However, we need to ensure they are part of a solution to the challenges of climate change. This is only possible by ensuring CCS is quickly proven, in line with the Prime Minister’s recent commitment to clean coal technology. A funding mechanism will be urgently needed.”

A small CCS plant operates in Germany but large-scale versions have yet to be developed. A competition has been launched by the British Government to ensure the construction of a full-scale CCS station by 2014.

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