As companies wait for the federal government to set out a clear timeline for when the investment tax credit and other policy tools will be put in place to support Canadian heavy industries’ investment in multibillion-dollar carbon capture and storage (CCS) projects, they are not simply idle on their emissions reduction plans.

CCS projects must get started immediately if Canada is to achieve its ambitious goals for cutting greenhouse gas emissions at least 40 per cent from 2005 levels by 2030 and reaching net-zero emissions by 2050. To achieve this, Canada’s current federal emissions reduction plan expects national CCS capacity to more than triple, to at least 15 million tonnes per year by 2030. In fact, that could be low: the Canadian Energy Regulator’s latest long-term outlook found that for Canada to achieve net-zero emissions by 2050, national CCS capacity, including carbon utilization projects, needs to get to 60-80 million tonnes per year by 2050. It’s about seven million tonnes/year today.

The major players in Canada’s heavy-emitting industries — which are big generators of GDP and government revenue, employ millions of people, and include firms that are at the core of most Canadians’ pension plans and investment portfolios — understand the urgency and have been moving ahead despite the lack of clarity on the business case for CCS in Canada.

In Alberta, Capital Power is expected to decide on a CCS project for its Genesee power plant this fall. In Edmonton, Heidelberg Materials is working on the world’s first CCS project on a cement plant and should be capturing CO2 before the end of 2026. For its part, the oilsands industry is already spending tens of millions of dollars on the environmental assessments, early-stage engineering work and stakeholder engagement that are necessary to receive permits for construction of one of the world’s largest CCS projects — by Pathways Alliance — which is expected to cut CO2 emissions by 10-12 million tonnes per year by 2030 on the road to net-zero oil production by 2050.

Canada has been a leader in the first generation of global CCS development, with five of only 30 commercial CCS projects underway worldwide. Though we generate less than two per cent of global CO2 emissions we account for approximately 15 per cent of current global CCS and carbon utilization capacity. Since 2000, CCS projects in Canada have safely stored more than 47 million tonnes of CO2, the equivalent of taking more than 10 million cars off the road.

Building on this world-leading experience, dozens of projects to develop carbon capture, pipeline and storage technology are moving forward in a wide range of industries, including cement, steel, mining and fertilizer, petrochemical, oil and gas and hydrogen fuel production.

Business leaders understand the window is closing fast for firms to capture a competitive advantage by providing low-carbon products the world continues to need.

Our investment lead does not make us immune to competition, however, especially from the United States and other jurisdictions where the economics of building projects are clearer. Critical gaps in Canadian CCS policy need to be addressed so we can meet the challenge of creating a diversified, low-carbon economy on the aggressive timeline established by federal climate targets. Ottawa has acted swiftly when it comes to supporting electric vehicle production. CCS expansion should be at least as high a priority.

At the moment, federal policy is in draft form. As officials sprint toward what is expected to be a fall finish line, we in the industry remain hopeful the stars will align so we can increase our build in 2024.

This column was original published in the Financial Post on July 23, 2023.