In response to the release of the Government of Canada's 2023 budget today, the International CCS Knowledge Centre welcomes the additional clarification and extended measures to support the development of large-scale carbon capture and storage (CCS/CCUS) projects in Canada that were included in the federal budget.
The Knowledge Centre’s President and CEO James Millar said:
“While we are pleased the budget includes several important items that will provide greater public support for carbon capture and storage, there are gaps in the certainty all heavy emitters were hoping for. The Knowledge Centre is concerned re-announcing a pledge made last fall that carbon contracts for differences will be introduced does not offer the certainty of actual legislation. This is much different than the reality in the United States with government providing companies $85 per tonne over 12 years for CO2 stored underground to combat climate change. In addition, Canadian industry faces a longer wait as the Government of Canada has committed to consultations on how the system will be set up. This will take months, if not more, increasing the likelihood of Canadian firms and CCS tech companies setting up shop south of the border, with investment dollars not far behind.
The Knowledge Centre is hopeful heavy emitters will not take their foot off the gas and will do what is necessary now, making those bold decisions to help fight climate change. But the need for certainty and a price on carbon for an extended period of time as the United States has done remains a solution left unanswered, for now.
As the International Energy Agency and the UN’s Intergovernmental Panel on Climate Change have concluded, a massive investment in large-scale CCS is required in order to achieve the emissions reductions needed to meet the Paris Agreement goal of limiting global warming to 2ºC.
We agree with the UN Secretary General Antonio Guterres who recently said that our world needs climate action on all fronts – “everything, everywhere all at once.” Carbon capture and storage is one of those key actions."
The Knowledge Centre is now completing a detailed analysis of all policies related to the investment tax credit for CCS development in Canada and plans to publish its findings in the near future.
Canada has been a leader in the first generation of global CCS development, with five of the 30 commercial CCS projects in the world today. These include SaskPower’s Boundary Dam Unit 3 CCS Facility — the world’s first fully integrated CCS facility on a coal-fired power plant, the largest CO2 pipeline on the planet - the Alberta Carbon Trunk Line, and the world’s largest storage project for human-made CO2 in the Weyburn-Midale region of southeast Saskatchewan that has permanently sequestered more than 38 million tonnes of CO2 since 2000.
Canada accounts for approximately 15 per cent of current global CCS/CCUS capacity – approximately seven million tonnes of CO2 per year – even though the country generates less than two per cent of global CO2 emissions. Since 2000, CCS projects in Canada have safely stored more than 44 million tonnes of CO2, or the equivalent of taking more than 9.4 million cars off the road.
Canada has pledged to cut its emissions by 40 – 45 per cent below 2005 levels by 2030 and to reach net zero emissions by 2050. Canada’s current federal emissions reduction plan expects national CCS capacity to more than triple, adding facilities to capture and store at least 15 million tonnes per year by 2030. Meeting this goal will rely heavily on implementing CCS in heavy industries across the country, including power generation; cement, steel and fertilizer manufacturing, mining, petrochemical processing, and oil and gas production.
The major players in Canada’s heavy-emitting industries – which provide major contributions to national GDP and government revenues, employ millions of people, and include firms that are at the core of most Canadians’ pension plans and investment portfolios – are committed to achieving net zero by 2050, and they are set to invest billions on CCS in Canada. Capital Power announced last December a limited notice to proceed for its Genesee CCS project. Heidelberg Materials continues to advance the world’s first CCS project on a cement plant in Edmonton. And the oil sands industry is already spending tens of millions of dollars on the environmental assessments, early-stage engineering work and stakeholder engagement that is necessary to receive permits for construction for one of the world’s largest CCS projects known as the Pathways Alliance.
About the International CCS Knowledge Centre
The International CCS Knowledge Centre is a non-profit organization dedicated to advancing large-scale carbon capture and storage (CCS) projects as a critical means of managing greenhouse gas emissions and achieving the world’s ambitious climate goals.
We provide independent, expert advisory services for CCS projects across heavy-emitting industries based on our team’s unique experience developing the world’s first fully integrated post-combustion CCS facility on a coal-fired power plant. We have a proven track record of helping our clients lower costs, reduce risk and improve the performance of CCS projects by being one of the world’s leading curators of information and lessons learned from major CCS projects across the globe.
Learn more at ccsknowledge.com
James Millar, President & CEO
International CCS Knowledge Centre