GOVERNMENT plans for a new generation of power stations were last night hailed as a step towards a new future for North East coal.

Energy Secretary Ed Miliband has insisted the new power stations would be made using measures to reduce their carbon emissions.

He said up to four new coal plants could be built before 2020, which he said was "important for our energy mix".

But at least a portion of each new power station must be fitted with the technology to trap and store their carbon dioxide underground. His announcement to MPs followed a statement by Chancellor Alistair Darling in yesterday’s Budget that there would be funding for up to four projects which demonstrate the new technology.

Mr Miliband said a levy to raise money for fitting the carbon capture and storage technology, which has not yet been tested at a commercial scale, would add an estimated 2% on energy bills by 2020.

Energy experts across the North East are working on CCS schemes and other innovative ways of turning coal into a greener fuel.

Ministers recently turned down a bid to pilot carbon capture in the region, a decision many hope will now be reconsidered.

Professor Dermot Roddy, Professor of Energy at Science City in Newcastle, said: "There are projects here in the North East which could benefit from this announcement especially in Teesside where we are fairly sure we could have a big impact.

"But following on from that is the question of where do we get our coal from?

"I think potentially the Government has taken a step towards underground gasification, which is the work we are looking at in Newcastle and will mean we can use North East coal and treat it without having to dig it up and turn it into gas."

Blaydon MP Dave Anderson has also welcomed the Government’s move.

Mr Anderson, who sits on the Government’s energy select committee, spoke to The Journal after the Budget.

He said: "The question we should be asking now is, if we are convinced, and I am, that coal power stations can be used in an environmentally sound way, then where do we get that coal from?

"I think there is still a future for the coal we have buried in the North East. Certainly nothing has been said to rule that out."

And Durham City MP Roberta Blackman-Woods, the deputy minister for the region, also lent her support to the plans.

She said: "I met Ed Miliband a few weeks ago to press him on the need for clean coal technology, including Carbon Capture and Storage, and I am extremely pleased that he has pressed forward with this policy.

"I believe we need an energy mix which includes clean coal as well as a good proportion of renewable sources. Coal plays and will continue to play an important part in our energy needs, but it must be part of the UK’s low-carbon future. CCS is about making that happen."

But not everyone is convinced the Government’s plans are right.

Friends of the Earth’s executive director Andy Atkins said: "Ed Miliband is right to signal the end of unabated coal-fired power stations – we recognise the enormous efforts he is making in trying to force the Government in a greener direction.

"But there is still a lot of uncertainty around carbon capture and storage – including whether it will even work."