Alberta, Canada’s main oil-producing province, is open to bolstering tax credits for carbon capture and storage (CCS) technology but also wants the federal government to increase financial support, Premier Danielle Smith has announced.
Carbon capture and storage is seen as a key plank in global efforts to fight climate change by cutting emissions, and last April the Canadian government unveiled tax credits designed to spur investment in the costly technology.
Now, Canada’s oil industry says it requires more government help to scale up the industry, especially after the US passed its Inflation Reduction Act, which includes massive tax credits for carbon capture and storage. The industry is seeking an increase to what was promised in Canada’s federal budget. Canadian prime minister Justin Trudeau has responded by urging Alberta to use its budget surplus to boost the tax credits.
Canada is home to the world’s third-largest oil reserves and is the fifth-biggest producer of natural gas, and the industry says it needs more government rebates to help scale up the technology.
Carbon capture and storage is emerging as a key plank in the fight against carbon pollution and climate change around the world. The Canadian oil and gas industry wants a level playing field as the federal government targets net zero emissions by 2050, the same goal set by US President Joe Biden.
Alberta has already invested or committed more than C$1.8 billion into CCUS and approved 25 proposals for carbon storage hubs in the past year.