Western Canada Leads The Way With Carbon Capture Utilization & Storage
- Jan 14, 2022 8:29 pm GMT
Carbon capture utilization and storage ("CCUS") is an important strategy as
Numerous industrial processes generate CO2. However, this CO2 can be captured at the source of the emissions, such as at power plants and refineries. Once captured, concentrated CO2 can be transported to places where it can be used as an input, for example, for enhanced oil recovery ("EOR") or securely and permanently stored underground in deep geological formations.
In 2014, SaskPower deployed the world's first carbon capture facility that is fully integrated with a post-combustion coal-fired power plant. BD3 has surpassed four million tons of CO2 captured since operational start-up, and offers a proven industrial-scale application for carbon capture.
Provincial Governments Explore Shared CCUS Infrastructure
To manage the deployment of CCUS, both the
Capital Expenditures a Challenge for CCUS Projects
One of the greatest challenges for CCUS is that it requires significant capital expenditure. As a result, government support is critical to the deployment of CCUS, including through mechanisms that defray the costs, such as tax incentives. In its 2021 budget, the federal government proposed the introduction of an investment tax credit for capital invested in CCUS projects with the goal of reducing emissions by at least 15 megatons of CO2 annually. The government held an engagement process, seeking input from key stakeholders on the design of the investment tax credit. An important issue for
Regulatory Changes Required to Support CCUS
Government support for CCUS is also necessary through the creation of a regulatory environment that provides industry with certainty. While some provinces, such as
Important issues include:<ul
- the ownership of pore space;
- long-term liability for stored CO2;
- a framework for how the reduction of GHG emissions will factor into the applicable Output Based Pricing System (OBPS); and
- an off-set credit program.
As new CCUS projects begin, it is important for industry participants to stay up to date on the regulatory landscape and government incentives available given the importance of these factors on the overall economic success of the projects.
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