Kimberly-Clark is to debate the "economic viability" of building a combined heat and power (CHP) station at its Northfleet paper mill in Kent, despite being given the green light by the Government.
A spokeswoman for Kimberly-Clark said: "Given the fact that it has taken two years for the Government to reach a decision, we now have to look into whether we will go on.
"We will now take the next few months to consider the project, but at this time we have no plans to proceed," she said.
The spokeswoman said the economic climate meant "every aspect of the project had to be looked into thoroughly".
Energy minister Helen Liddell recently gave the go-ahead for Scottish & Southern Energy to build a 110MW gas-fired CHP station at the Northfleet site.
"The decision demonstrates the Government's continuing commitment to promote CHP, and our commitment to reducing emissions of carbon," said Liddell.
The go-ahead was given in a written answer to a recent Parliamentary Question from Michael Foster MP (Worcester).
"Wherever practicable we will promote CHP, continuing our commitment to reducing carbon emissions to fulfil our promises made at Kyoto," said Liddell.
The aim of the CHP station would be to supply the heat and electricity needs for the Northfleet plant.
Story by Andy Scott
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