Alberta Eyes CCUS Incentive Program, Hits Methane Targets Early

The government of Alberta has announced a program that aims to help develop carbon capture, utilization and storage (CCUS) projects in the province by providing major industries with up to 12 percent of new eligible project costs.

The Alberta Carbon Capture Incentive Program (ACCIP) will help businesses in multiple industries, such as oil and gas, power generation, hydrogen, petrochemicals and cement, reduce their emissions by incorporating CCUS technology into their operations, the government said in a statement Tuesday, adding that CCUS is “currently the only viable option available for these industries to significantly reduce their emissions”.

Provincial funding will be available once the federal government has legislated its CCUS investment tax credit and related operating supports, such as contracts for difference, according to the release. The ACCIP will build on the federal investment tax credit proposed by the federal government in its 2021 budget. The government is currently working on program specifics with more details expected to be available in the spring of 2024.

“Alberta is transitioning away from emissions, not from proven, reliable energy sources”, Alberta Premier Danielle Smith said. “We have invested significantly in CCUS projects and now we’re encouraging the private sector to do the same. Together, we can ensure Alberta remains a leader in providing responsibly sourced energy solutions to meet worldwide demand”.

“This program is yet another example of Alberta’s leadership in advancing CCUS technology”, Minister of Energy and Minerals Brian Jean said. “Alberta is doing its part to encourage CCUS and now we’re calling on Ottawa to cooperate with the provinces and kick-start its investment tax credit to support this important work. ACCIP will help ensure Alberta remains competitive internationally, as competing jurisdictions use similar project incentives”.

According to the statement, developing CCUS is a key component of Alberta’s Emissions Reduction and Energy Development Plan. The province has invested or committed more than $1.33 billion (CAD 1.8 billion) to support projects and programs, including more than $533 million (CAD 750 million) from the Technology Innovation Emissions Reduction (TIER) fund. To date, two projects in Alberta, Quest and Alberta Carbon Trunk Line, have safely captured and stored a total of more than 11.5 million metric tons of carbon dioxide since starting operations.

“ACCIP will build upon the strong value proposition that Alberta’s Industrial Heartland already offers and will help attract more capital investments to our $45-billion world-renowned energy cluster. This program will help strengthen the business case in Alberta by ensuring companies can reach both their economic and environmental goals”, executive director of Alberta’s Industrial Heartland Association Mark Plamondon said.

Alberta Hits Methane Reduction Targets Early

In a separate statement, the government of Alberta said the province has hit its methane reduction target three years early, having reduced methane emissions from the oil and gas sector by 45 percent since 2014.

“In Alberta, we are transitioning away from emissions and not away from oil and gas. We have proven we have the technology, the innovation, and the determination to achieve significant emissions reduction and we will not stop here. Alberta has a strong story to tell on environmental challenges and we will continue to share it”, Alberta Premier Danielle Smith said in the statement.

“The Canadian Association of Petroleum Producers is pleased with today’s announcement that the province’s methane reduction target from oil and natural gas operations has been met ahead of schedule”, Canadian Association of Petroleum Producers President and CEO Lisa Baiton said. “Alberta’s approach with effective regulations, offset programs, and research support contributed to accelerating methane emissions reductions. Over the past decade, our industry has reduced methane emissions while growing production and is also on track to surpass the current federal target of a 40 to 45 percent reduction by 2025. We are investing significant resources into research and will continue to work with the provincial government on additional emissions reduction opportunities”.

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