Canada’s energy minister is defending carbon capture and storage technology as each efficient and reasonably priced, after an Alberta power company walked away from a planned project and a examine discovered that one other project received public subsidies to cowl greater than three-quarters of its prices.
“Carbon capture and sequestration technologies are getting better and, over time, they actually get less expensive just like every other technology that goes through the cycle,” Jonathan Wilkinson stated Tuesday.
“For those that say that the technology itself is not proven, I’d just say to them that’s not true. The technology, the basic technology, has been around for a long time. It’s a matter of scale and it’s a matter of cost and those are both things that are actually happening.”
Carbon capture, utilization and storage, often known as CCUS, are methods that lure carbon emissions at their supply after which funnel them again underground. They are anticipated to play a key position in Canada’s local weather plan, which can not meet its targets and proceed to provide the oil and gasoline that underlie a good portion of Canada’s economic system.
The local weather plan estimates carbon capture will account for as much as 16 million tonnes of emissions reductions by 2030, or about 5 per cent of the extra emissions reductions wanted to satisfy the subsequent goal in 2030.
The International Energy Agency expects CCUS might want to account for 15 per cent of worldwide emissions reductions by 2050 to attain net-zero, the place all emissions are eradicated or captured.
“Increased use of CCUS features in the mix of every credible path to achieving net zero by 2050, including all 1.5 C pathways developed by the United Nations Intergovernmental Panel on Climate Change and the (International Energy Agency),” Canada’s local weather plan reads.
But in Canada, that elevated use is proving to be difficult.
The newest nationwide emissions report revealed final week exhibits that as of 2022, Canada had captured and saved a complete of seven.2 million tonnes of carbon dioxide since 2017, most of it at Shell Canada’s Quest CCS facility at its Scotford upgrader north of Edmonton.
Shell lined about three-quarters of the $1.1 billion capital and working prices for Quest by way of provincial and federal subsidies, and the remaining got here from the sale of carbon credit generated by way of the trapping of carbon emissions.
A Greenpeace examine launched this week discovered that to make ends meet, the corporate received permission from Alberta to promote twice as many credit because it truly earned.
A Shell spokesman stated in an announcement to The Canadian Press Wednesday that the additional credit had been an “innovative mechanism to make investment in the Quest CCS project possible.”
However, Stephen Doolan stated the double carbon credit had been solely allowed till project prices broke even and all further credit Shell earned had been used to satisfy its personal emissions necessities in Alberta. They weren’t bought to some other corporations, Doolan stated.
Quest has now trapped a complete of 9 million tonnes of carbon, he stated.
“Without the various incentives to make the project investible, this would simply not have happened,” he stated.
Last week, Capital Power, an Edmonton electrical energy generator, scrapped a $2.4-billion carbon capture system deliberate for its Genesee producing station as a result of the economics didn’t work. A press release from the corporate in its quarterly earnings report on May 1 stated that whereas carbon capture is “technically viable” the corporate didn’t imagine the project to be “economically feasible.”
The choice comes even because the Alberta authorities was promising to cowl as much as 12 per cent of the prices and the federal authorities as a lot as half by way of a brand new tax credit score.
Additional certainty was being examined with carbon contracts for distinction below the brand new Canada Growth Fund. Such contracts assist present certainty {that a} carbon market can be sturdy for credit generated by technology like carbon capture and storage.
The uncertainty over whether or not the federal carbon worth can be maintained by future governments undermines confidence that such markets will exist or that top sufficient costs can be achieved for the credit. Investments solely make sense if corporations can get certainty in regards to the worth they’ll be capable of promote these credit for.
Capital Power has not but been capable of negotiate a contract for distinction.
Wilkinson stated the cancellation shouldn’t be considered as a sign towards carbon capture.
“There are a number of different pathways for Capital Power to be able to actually meet the requirements of the clean fuel or clean electricity regulations which will eventually come into force,” he stated.
“They’ve made a business decision that they can actually meet those requirements in a different way. But as I say, there are going to be many different approaches in different sectors that I believe will use carbon capture technology.”
The Alberta authorities blamed the Capital Power choice on the actual fact Ottawa hasn’t but put the carbon capture tax credit score in place.
The credit score was first promised three years in the past however took a number of years to design, and was included within the laws to implement the autumn financial assertion in November.
That invoice nonetheless hasn’t handed. It is up for debate once more this week.
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