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Energy secretary Chris Huhne has been challenged to explain what the government鈥檚 plans really are for the 拢1bn of funding set aside for carbon capture and storage projects.

Plans to build a full size carbon capture and storage plant at Longannet in Scotland collapsed in October when Scottish Power pulled out of the deal, freeing up the 拢1bn of government funds.

But last week, Treasury secretary Danny Alexander said the money had now been 鈥渞eallocated to different sorts of projects.鈥�

Tim Yeo, chair of the Energy and Climate Change Select Committee, has written to Huhne to demand answers on what will happen to the cash.

Yeo wrote: 鈥淢y committee was shocked by reports that the 拢1bn set aside by the government to develop a carbon capture and storage demonstration project would be borrowed for other purposes and little comforted by the chancellor鈥檚 remarks in the debate on the autumn statement.鈥�

He added: 鈥淲e are extremely concerned that the Treasury鈥檚 short-term fixes will endanger our long-term economic and environmental prospects and these issues are not being given the weight they deserve in Whitehall.鈥�

Huhne is set to appear before the select committee next week to answer question on international climate talks currently taking place in Durban, which Yeo will use to ask him about the use of the 拢1bn.