Alberta reveals new carbon capture program, offering up to 12 per cent subsidy for new projects

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“We are in such a unique position in Alberta because we have immense storage capacity,” said Smith

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Alberta’s new multibillion-dollar carbon capture, utilization and storage (CCUS) program will offer up to 12 per cent of capital costs for new projects, Premier Danielle Smith revealed Tuesday.

The Alberta Carbon Capture Incentive Program’s (ACCIP) aim is to help primarily the oil and gas industry — though also hydrogen, petrochemicals, among others — to use CCUS technology to reduce emissions and spur more investment.

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“We are in such a unique position in Alberta because we have immense storage capacity,” said Smith, estimating the incentives will support up to $35 billion in new investment.

“We already have development of projects that are operating at scale. We’ve already seen a historic 11 megatons of emissions, and we are on the cusp of seeing a great deal more of that.”

The provincial funding builds on a federal investment tax credit which was introduced by Deputy Prime Minister and federal Finance Minister Chrystia Freeland earlier Tuesday, though it still must pass through the legislative process.

“It will enshrine these investment tax credits into law,” Freeland said.

“The money will be there for businesses to make use of them and make investment decisions based on them.”

The province said more details on its plan will be made available by next spring, and put the forecasted cost of the program at between $3.2 billion and $5.3 billion over the next decade.

Alberta Energy and Minerals Minister Brian Jean said the province’s geology afforded it the ability to store emissions “for many, many years to come, if not forever.”

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“We have the capacity to store 100 per cent of global emissions from the world right now … that’s what the experts have told me.”

Alberta is home to two large CCUS projects — Quest at the Scotford upgrader near Edmonton, and the Alberta Carbon Trunk Line, a 240 km-long pipeline that gathers, compresses and stores carbon dioxide. The government estimates the two projects have captured and stored a combined 11.5 million tonnes of carbon dioxide since opening.

Speaking to reporters inside the legislature Tuesday, Opposition Leader Rachel Notley said she is hopeful the announcement will accelerate investment but also cautioned that CCUS is only part of the solution to reducing Alberta’s emissions.

“The fact that this provincial government is putting all its eggs just into that basket is concerning to me,” she said.

“Emissions reduction is not only an environmental necessity, it is also an economic opportunity. And it is one that this provincial government is absolutely determined to reject.”

Also Tuesday, the government announced it had hit its methane reduction target three years early and reduced methane emissions from the oil and gas sector by 45 per cent since 2014.

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Environment Minister Rebecca Schulz hailed the benchmark as a vindication for what she described as the government’s “practical approach.”

A report from Carleton University’s Energy and Emissions Research Lab earlier this month concluded that emissions were underestimated by nearly 50 per cent.

Schulz suggested Tuesday taking those results “with a grain of salt” and claimed “a number of the authors are linked with groups that are fundamentally opposed to our oil and gas industry and want to see it shut down.”

Tuesday’s announcements came two days before Smith and Schulz, along with more than 100 other delegates, are scheduled to depart for the COP28 conference in Dubai.

“We’ve got to be there to tell our own story,” Smith said.

Federal Environment Minister Steven Guilbeault — a frequent target for Smith — will lead Canada’s delegation to the conference.

Smith said while the two governments remain opposed over Ottawa’s clean electricity regulations, she said her federal counterparts have been “a good collaborator” on other projects, including hydrogen and modular nuclear reactors.

“I hope at this conference we can focus on the areas where we agree,” she said. “It’s up to them.”

mblack@postmedia.com

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