The British government said it received financial support from the European Commission for its White Rose project, a so-called clean coal power plant that would capture as much as 90 percent of its emissions and store them underneath the North Sea.
British Energy and Climate Change Secretary Ed Davey said White Rose will help with the development of a low-carbon economy in the country.
"The U.K. is at the forefront of developing carbon capture and storage, with excellent potential for storage in the North and Irish Seas, and the expertise in operating offshore to make it a reality," he said in a statement.
The British government said power plants equipped with carbon capture and storage technology could provide more than 20 percent of the nation's electricity by 2050.
White Rose would be the first plant of its kind in the country. The British government in December signed preliminary design study contracts for the facility in December.