Alberta introduces carbon capture program offering industries 12% in project grants

The Alberta government said Tuesday it would give major industries up to 12 per cent in grants on eligible capital costs for carbon capture, utilization and storage.

Premier Danielle Smith said the province expects the incentive program will create jobs while cutting emissions.

"We estimate that over the next decade, these incentives will support up to $35 billion in new investment and create thousands of good paying jobs and other economic benefits across the province," Smith said Tuesday in a media conference at the Alberta legislature.

CCUS is the process of capturing carbon dioxide emissions before they are released, compressing them and pushing them underground.

The Alberta Carbon Capture Incentive Program promises to help industries such as oil and gas, hydrogen, petrochemicals, power generation and cement with the eligible costs for CCUS technology to reduce emissions.

Smith said a portion of the funding for Alberta's incentive program will be accessed from the Technology, Innovation and Emissions Reduction fund, which is fully funded by industry payments for greenhouse gas emissions.

She said Alberta is in "a unique position" as the province possesses "immense storage capacity," adding some projects are "operating at scale" and that 11 megatonnes of emissions have already been stored.

Energy Minister Brian Jean said Alberta has the capacity to store "100 per cent" of the world's greenhouse gas emissions.

"We have a geology that is second-to-none in the world," Jean said. "Given our legal process here, it gives us a competitive advantage even over the United States."

The Alberta move comes following a CCUS tax credit announced by Ottawa last year that was created to help encourage industry to more rapidly adopt emissions reduction technology.

Critics question the effectiveness of the process. A 2022 report by Global Witness found Alberta's Quest carbon capture facility emitted more carbon dioxide than it captured.

"Most of the projects have been abandoned. It can only capture a small portion of emissions," Keith Stewart, a senior energy strategist for Greenpeace Canada, told CTV News Edmonton.

"If you look at the proposal from the Pathways Alliance, they say they're going to capture 10 to 12 megatonnes ... that's 15 per cent of the emissions to produce the oil, but it's only about two per cent of the emissions when you look at all the emissions from producing and then using the oil as gasoline or diesel. It's not getting us anywhere close to net zero, and it's a very expensive way to go about this."

The Pathways Alliance is a consortium of large Canadian oilsands companies that has proposed a $16.5-billion carbon capture and storage network to decrease emissions from its sites in northern Alberta.

The Alberta incentive program could cost the province up to $5.3 billion over the next decade, a cost Stewart says should be paid by industry.

"This is more public funds being poured into carbon capture and storage, which frankly should be financed by the oil companies themselves," Stewart said. "They should be cleaning up their own mess. Scarce public dollars should be going to the long-term solutions."