Opinions split over benefits of carbon capture tax credit

The federal government's emissions reduction plan stated that advancing carbon capture and storage projects features can help the country achieve net zero emissions by 2050,

A forthcoming federal tax credit for carbon capture and storage is spurring debate between those who say it will help Canada achieve its emissions reduction goals, and those who view it as a thinly veiled subsidy for the oil and gas industry.

Ottawa is expected to unveil its promised carbon capture investment tax credit in next week’s federal budget. Though details have not yet been made available, the federal government’s emissions reduction plan released Tuesday stated that advancing carbon capture and storage projects features in the mix of “every credible path” to achieving net zero emissions by 2050, including scenarios laid out by the United Nations and the International Energy Agency.

“We shouldn’t see this as a silver bullet. It shouldn’t be the beginning of our climate change strategy,” said Environment Minister Steven Guilbeault in an interview March 27. “But (carbon capture) is going to be one component of many, and one of the tools in our tool box.”

Carbon capture and storage (CCS) is a technology that captures greenhouse gas emissions from industrial sources and stores them deep in the ground to prevent them from being released into the atmosphere.

The technology is expensive and has been slow to scale up, in spite of having been around for decades. There are only a small handful of CCS projects currently up and running in Canada, but many proposed projects, including ones by Enbridge Inc., ATCO Ltd., TC Energy, Capital Power, and Pembina Pipeline Corp.

READ MORE: Ottawa expected to release details of carbon capture tax credit soon, Cenovus says

In addition, the Oil Sands Pathways to Net Zero initiative an alliance of Canadian Natural Resources Ltd., Cenovus Energy Inc., ConocoPhillips, Imperial Oil Ltd., MEG Energy Corp., and Suncor Energy Inc has proposed a major carbon capture and storage transportation line that would capture CO2 from oilsands facilities and transport it to a storage facility near Cold Lake, AB.

That project alone could deliver about 10 million tonnes of emissions reductions and could be up and running by the end of the decade, said Mark Cameron, a senior adviser for the oilsands net zero group who works for MEG Energy.