The MOU announced yesterday marks a pivotal moment in Canada’s energy and climate leadership. By committing to advance large-scale carbon capture, utilization and storage (CCUS) and aligning federal and provincial pathways for infrastructure investment, this agreement supports what industry needs most: clarity, collaboration, and confidence to act. We hope this marks a turning point where Canada can build on its position as an international leader in carbon management technologies.
The International CCS Knowledge Centre is encouraged by the agreement’s decisive shift towards enabling deployment rather than debate. Strengthening Alberta’s TIER system to reach an effective carbon price of $130 per tonne provides the long-term investment signal required to scale CCUS. The inclusion of CO₂ Enhanced Oil Recovery (EOR) within the CCUS Investment Tax Credit expands viable pathways for capture projects. The agreement also confirms that the Pathways Alliance CCUS projects and the bitumen pipeline to the West Coast will move forward together, diversifying markets for Canadian resources. Continued collaboration is the only way to move ambitious emission reduction forward.
In a critical signal to investors, both the federal Oil and Gas Emissions Cap and the Clean Electricity Regulations are being set aside in Alberta, reaffirming industrial carbon pricing as the primary economic driver of emission reductions, rather than relying on prescriptive regulatory approaches. Alberta’s commitment to advancing policy frameworks for nuclear power and data sovereignty positions CCUS to support the broader energy-sector transformation and emerging industrial demand. Additionally, the commitment to develop Canadian supply chains for CCUS technologies and pipeline infrastructure reinforces the opportunity for economic and export leadership.
Under the partnership, Canada and Alberta will support the world’s largest CCUS project – Pathways. They will also support a new bitumen pipeline – exporting some of the lowest carbon-intensity oil in the world. And support building AI computing power, with transmission interties with BC and Saskatchewan. The partnership shows true collaboration and support for Canadian jobs and economic growth.
The MOU includes ambitions milestone deadlines and actions:
- Canada will not implement the oil and gas emissions cap
- Canada will acknowledge Alberta’s TIER program to support the changes needed to achieve a net-zero power grid by 2050.
- By April 1, 2026 Alberta will have negotiated a new carbon pricing agreement, ramping up the minimum credit price to $130/tonne and Canada will suspend the Clean Electricity Regulations in Alberta
- By July 1, 2026 Alberta will implement a policy framework for large investments in data centre development
- By January 1, 2027 Alberta will work with Canada to develop a nuclear strategy
- Canada will extend the ITCs and include enhanced oil recovery
- Canada and Alberta will enter into a methane equivalency agreement by April 1, 2026 with a 2035 target date for a 75% reduction from 2014 levels
To translate this agreement into real-world projects, emission reductions, and global leadership, we need to keep moving forward in the same direction. You can read the full MOU here: Canada-Alberta Memorandum of Understanding | Prime Minister of Canada