Capturing carbon dioxide from smokestacks, to prevent the greenhouse gas from heating the atmosphere, once seemed like science fiction. Today, it is edging toward widespread use.
To some environmentalists, the technology is a distraction, perpetuating reliance on fossil fuels. To the International Energy Agency, whose net-zero road map sees global oil production down 75 per cent by 2050, carbon capture is an important tool in a mix of technologies led by renewable power. To Canada, carbon capture is a pragmatic necessity to reduce this country’s elevated emissions.
The technology will be at the fore late this month at COP28, the annual United Nations climate gathering, hosted this year in Dubai by the United Arab Emirates. The country has staked a lot on carbon capture. Canada has, too. Ottawa is finalizing a tax break worth about $12-billion and Alberta is readying one of at least $3-billion of taxpayers’ money.
The UAE is among the world’s leading oil producers, a volume about the same as Canada’s. The seeming dissonance of an oil producer hosting a climate conference has stoked controversy: UAE’s top oil executive is president of the conference. Yet reducing emissions from oil production – ahead of predicted, and necessary, declines in demand – is part of the net-zero puzzle.
The idea of carbon capture has always been alluring. Corral plumes of carbon dioxide from industrial facilities, such as an oil sands operation or cement and steel plants, compress the gas and move it by pipeline to inject underground. Yet the problems of the past, cost and feasibility, remain the problems of the present.
Carbon capture has never lived up to the many years of hype. Annual global capacity is about 45 megatonnes, a figure that has barely risen in several years. While the IEA says capacity needs rise 25-fold by 2030 to get on pace with net zero by 2050, the technology so far has been a “great disappointment.”
Canada has little choice but to try.
This country’s No. 1 export is oil. In September, it was one-sixth of all exports. And in a country with falling productivity, the oil business is an economic shining star. Building up carbon capture could also be an economic opportunity, to become a leader in deploying the technology. Further, carbon capture is broadly important in the climate fight: key sectors, today and in the future, such as cement and steel generally have no other obvious way to slash emissions. The oil sands get all the attention but emissions from heavy industry are almost as high.
Industry is calling for heavy subsidies. The oil sands companies, with their many billions of dollars in recent profits and dividends to shareholders, want governments to pay for the majority of a planned $16-billion carbon capture project. Some public money makes sense – the oil sands boom was in part propelled by federal and provincial tax breaks in the 1990s – but a better balance should be struck.
The federal Liberals first announced their plan to subsidize carbon capture, for all industries, in 2021. The official tax credit is expected soon. In Alberta, after halting development of renewable power, planning rules to make it more difficult and costly to build, and working to delay federal clean power rules by 15 years, the province wants to show it is trying to reduce emissions. The United Conservative government aims to make a splash this month on carbon capture and believes the technology could reduce provincial emissions by roughly 50 megatonnes – 20 per cent of Alberta’s total and more capture capacity than exists worldwide.
The how-well-will-it-work question lingers. The Quest carbon capture project at the Scotford oil sands upgrader near Edmonton, majority funded by public money, does work – somewhat. In 2022, its net capture was 0.755 megatonnes, about a quarter of the facility’s total emissions.
All of this underscores the real way to reduce emissions from oil: rapidly reduce its use in transportation. But as the International Energy Agency notes, some oil and natural gas will be part of the net-zero mix in the second half of this century, and figuring out how to lower emissions in the production process is needed. That’s especially true for Canada, where the fossil fuel industry is the biggest emitter, at almost 30 per cent of the total.
The focus at COP28 has to be about getting off fossil fuels and building up clean power. But there’s a place to talk about carbon capture. Canada should be a leader on all fronts.