By betting it may resolve its emissions downside with carbon seize and storage, Canada’s oil and gasoline business dangers saddling itself with costly stranded property, a brand new report argues.
The report, launched Thursday by the Worldwide Institute for Sustainable Improvement – a Winnipeg-based think-tank that focuses on local weather and sustainable useful resource growth – concludes carbon seize and storage know-how prices an excessive amount of and takes too lengthy to construct to have any hope of serving to business meet Canada’s 2030 emissions reductions goal.
Calling the know-how “costly, vitality intensive (and) unproven at scale,” the report urges the federal authorities to not put any extra public cash into the oil and gasoline business for carbon seize deployment.
Oilsands execs say nowhere to spend money on inexperienced know-how, regardless of report income
A part of the Solar breaks free and varieties a wierd vortex, baffling scientists
“The applying of CCS doesn’t align with the time scale or ambition obligatory for limiting international warming to 1.5 levels C,” the report states.
“The chance value of investing in CCS and the danger of stranded property for Canada’s oil and gasoline sector will intensify as international local weather ambition ratchets up and demand for oil and gasoline declines.”
Carbon seize and storage is a know-how that captures greenhouse gasoline emissions from industrial sources and shops them deep within the floor to forestall them from being launched into the environment.
The know-how has existed for many years, however it’s costly and has been sluggish to scale up. There are at present simply seven CCS tasks at present working in Canada, principally within the oil and gasoline sector, and solely 30 commercial-scale CCS tasks in operation globally.
Prime Minister Trudeau urges Alberta to contribute to carbon-capture incentives
Nonetheless, the oil and gasoline business has excessive hopes for the know-how, with numerous new tasks within the strategy planning stage in Canada. Most notably, the Pathways Alliance – a consortium of the nation’s six largest oilsands corporations – has proposed a serious carbon seize and storage transportation line that may seize CO2 from oilsands services and transport it to a storage facility close to Chilly Lake, Alta.
Meet the ‘Oldfluencers’ – Canadian child boomers placing a brand new face on ageing
‘A sport on hearth’: How the exponential development of pickleball has served up controversy
Whereas a closing funding determination has not been made, the undertaking is estimated to value $16.5 billion and is the centrepiece of the Pathways group’s complete $24.1-billion pledge to cut back greenhouse gasoline emissions from oilsands manufacturing by 22 million tonnes by 2030.
“The oil sector in Canada has been figuring out CCS as the foremost part of its plan to carry down emissions,” stated Angela Carter, co-author of the IID report.
“In truth, some business representatives, they body CCS as the one choice to make the sort of giant inroads which are wanted to cut back emissions within the oil and gasoline sector. It’s very very like the business is placing all of its eggs within the basket of CCS.”
Carbon seize talks being blocked by tensions between Ottawa, Alberta: oil group
Unique: Widow’s 911 name earlier than James Smith Cree Nation murders reveals prior violence
In a latest op-ed, James Millar – president and CEO of the Worldwide CCS Data Centre in Regina, Sask. – argued that carbon seize is a approach for Canada to “have its environmental cake, and eat it too.”
Millar stated the wide-scale deployment of carbon seize know-how will permit for a transition to net-zero “whereas sustaining the viability of industries which have lengthy sustained communities and workforces throughout the nation.”
“To construct this capability, business is searching for sturdy indicators that investments in CCS and different emissions discount applied sciences align with Canada’s low-carbon future,” Millar stated.
“Wider funding in CCS requires clear coverage offering long-term certainty on carbon pricing, together with different mechanisms that may guarantee Canada stays a sexy location (particularly when in comparison with the USA) to undertake multi-billion-dollar tasks.”
Pathways Alliance oilsands group pledges to spend $16.5B on carbon seize undertaking
Carter stated this type of continued lobbying by business for extra authorities funding and regulatory assist for carbon seize tasks, above and past the funding tax credit score introduced in final 12 months’s federal finances, is problematic.
She identified the seven CCS tasks at present working in Canada seize simply 0.5 per cent of nationwide emissions, and that ramping that as much as important ranges by 2030 would require large authorities subsidies.
“CCS has been over-promised and under-delivered,” she stated, including a more cost effective use of public funds could be to encourage near-term emissions cuts by way of laws, such because the federal methane guidelines at present underneath growth.
Authorities must also be specializing in vitality effectivity and electrification, in addition to planning for a long-term decline in oil and gasoline manufacturing, Carter stated.
In a report printed final August, BMO Capital Markets argued that authorities can and should do extra to get carbon seize tasks up and working on this nation.
The report stated the Inflation Discount Act south of the border ensures roughly two-thirds of carbon seize undertaking prices (capital and working prices) are coated by the U.S. authorities.
By comparability, the BMO report stated, the investor tax credit score introduced by the Canadian federal authorities in 2022 would cowl lower than 15 per cent of the proposed Pathways Alliance carbon seize undertaking’s complete prices by 2050.
“We consider the U.S. coverage development additional underscores the necessity for considerably extra sturdy coverage incentives to bolster Canada’s aggressive place within the decarbonization race,” the BMO report said.
© 2023 The Canadian Press