* New project to fit CCS on 90 percent of capacity
* Carbon to be sent to St. Fergus for North Sea burial
LONDON, March 20 (Reuters) - British energy network operator National Grid and oil and gas services firm Petrofac plan to build a 400-MW coal-fired power plant with carbon capture and storage (CCS) in Britain with U.S. partner Summit Power, the companies said.
The consortium will apply for funding from the British government, which will shortly relaunch a 1 billion pound ($1.6 billion) tender for CCS projects after a first round of funding failed due to cost overruns.
The new power plant, named Caledonia Clean Energy Project, will be based at the Scottish port of Grangemouth, west of Edinburgh, and will capture carbon emissions from more than 90 percent of its production capacity.
"The carbon dioxide captured will be transported via pipeline to St. Fergus by National Grid Carbon and then transferred offshore for geological sequestration deep under the North Sea by Petrofac subsidiary, CO2DeepStore," Seattle-based Summit Power said in a statement on Tuesday.
The plant will also produce hydrogen gas, which can be supplied to local industrial users.
The British government considers CCS as vital to reduce carbon emissions from power plants, but developing such plants is expensive as the technology has not been proven on a commercial scale.
In October last year, the government's plan to fund Scottish Power's Longannet CCS project failed after the parties could not agree on the extent of the government funding.
The government said in a pre-tender document published in the European Union's official journal in February that it wanted new CCS projects to start demonstrating carbon dioxide capture by 2016-2020.
Summit Power is a U.S. developer of clean energy projects and has over 7,000 megawatts (MW) of power plants in operation.