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The fossil fuel industry players are lining up at the carbon capture buffet, but they’ve left their wallets at home. Unfortunately, as the saying goes, there’s no such thing as a free lunch.

Oil and gas companies are looking for the public to foot the bill for carbon capture and storage (CCS) to allow the sector to reduce emissions while shirking the risk of the investment. And governments are buying in.

Federal and provincial governments have so far committed more than $12 billion to carbon capture, with Alberta poised to release a new incentive program for the technology in the coming months. With all those tax dollars flowing toward CCS, it's vital that we evaluate whether those funds are being well spent.

Canada's oil and gas sector bears responsibility for emitting over a quarter of the country's greenhouse gases. If we are to achieve our national target of reducing emissions by 40 to 45 per cent below 2005 levels within the next seven years, it is imperative this sector pulls its weight. Oil and gas companies are proposing that carbon capture and storage can do the heavy lifting — at the cost to the taxpayer — while enabling them to increase production.

But the track record of CCS does not indicate it’s up for the task.

CCS technology has been slow to develop. There are only 30 commercial carbon capture and storage projects operating globally, with the seven in Canada capturing less than two per cent of the sector’s emissions. In the majority of these projects, the carbon that is captured is injected into declining oilfields to actually increase oil production.

The technology has also faced stubbornly high costs. The costs vary widely for CCS in different sectors, but in the oil and gas sector, the technology is expensive and has seen limited cost reduction over decades of development and commercial use.

A major reason for the big price tag is the complexity of the technology. There are many different pieces that must work together, which makes innovation difficult. CCS also needs to be customized to the specific industrial process and geological conditions. So technical advances in CCS for a cement plant, for instance, will not necessarily be applicable to CCS development for an oilsands facility.

Oilsands producers in the Pathways Alliance claim the technology is nearing a turning point and with more public investment, it will become economical and scalable. But given the complexity, the need to tailor the technology and the relatively few potential CCS projects in the oilsands, it is unlikely that economies of scale could be reached that would allow costs to drop significantly.

Funds spent on #CCS come at the cost of investment in other low-carbon solutions, writes Laura Cameron @IISD_Energ #FossilFuelSubsidyReform #FossilFuelPhaseOut #JustTransition #RenewableEnergy #cdnpoli

On the other hand, renewable energy technologies such as solar PV, onshore wind, and batteries have seen significant cost reductions as the technologies have been developed and deployed at scale. Wind and solar are the cheapest sources of new electricity in history, and precipitous cost declines are expected to continue, particularly in light of the U.S. Inflation Reduction Act. While CCS is necessarily location-bound and tailored to the industrial facility, solar panels can be deployed in a wide range of contexts with very little customization.

Given the poor track record and high cost of CCS in the oil and gas sector to date, governments should think twice about their support for this technology. Funds spent on CCS come at the cost of investment in other low-carbon solutions. With finite public funds and an urgent need to curb emissions and adapt infrastructure, careful scrutiny of investments is needed to get the best bang for our public buck.

As it stands, we are setting the table for oil and gas companies to have their cake and eat it too when it comes to emissions reductions. The federal government has new guidelines to stop subsidizing the fossil fuel industry, but carved out exceptions to allow for continued support for CCS in the sector. This should be reconsidered until the technology has proven effective and cost-competitive.

Ultimately, oil and gas companies should be funding their own emissions reductions given their outsized contributions to, and profits from, the primary source of the climate crisis. Canada’s five biggest oil and gas companies made over $38 billion in profits last year, but are prioritizing returns to shareholders over investments in emissions reductions.

Regulations like a strong cap on oil and gas sector emissions can ensure companies own up to their fair share of reductions, via CCS or otherwise, without expecting taxpayers to pick up the tab.

Laura Cameron is a policy adviser for IISD’s energy team working in the areas of fossil fuel subsidies, just transition and oil and gas policy in Canada. With a master’s degree in Indigenous governance and a bachelor’s degree in biology, her interdisciplinary interests centre on environmental justice, participatory filmmaking and community-led climate action.

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Thanks for printing this article (more on the topic please, lots of threads to tug on)
and saying the ugly parts (plural) out loud.
Let's all stay on this like a dog on a bone because the oil and gas industry are heavily invested in greenwashing us with the idea of carbon capture, whilst simultaneously fleecing us.

Totally agree. It's their carbon-spewing mess, they should clean it up. Also, let's not forget about the hundreds of orphaned oil wells they committed to clean up and are now looking for taxpayer dollars to do it.

Given the non-stop greenwashing by the oil and gas industry, tax payers defiantly should not be footing the bill for their greenwashing technology. Carbon Capture is mere nonsense created by the oil and gas industry to make Canadians think they are doing something to reduce their foot print on the environment. This is just another O&G subsidy in disguise.

It is time governments at all levels should eliminate subsidies for the oil and gas industries.

O&G industry lobbyist Danielle Smith's main mission is to funnel public dollars to largely foreign-owned O&G companies to fund fake climate solutions industry should be paying for.
What's Trudeau's excuse?

Carbon capture (CCS) has limited application in the oilsands. Expensive, energy-intensive, and inefficient. CCS captures a mere fraction of upstream emissions and zero emissions downstream at the consumer end. Huge opportunity costs.

Climate plans banking on fossil fuel expansion and carbon capture (CCS) are designed to fail. If industry insists on false climate solutions, let industry pay for it. Leave taxpayers out of it.
Let the O&G industry clean up its own messes: fossil fuel pollution, including greenhouse gas emissions, facility and well cleanup and reclamation. Standard business expenses. Industry's responsibility, not ours.
Fossil fuel subsidies, visible and invisible, undermine carbon pricing. Put a realistic and incremental increasing price on carbon, and let O&G companies figure out how to reduce emissions. They can either pay for emissions reductions — or wind O&G operations down and shift to low-carbon energy production.

Pembina Institute: In the oilsands sector "most CO2 is emitted in low concentration streams, and the efforts to capture it will be challenging and expensive."
The IPCC ranks CCS as one of the least-effective, most-expensive climate change mitigation options.

"Yet even RBC admits that a rapid deployment of [carbon capture] technology isn't very likely.
"'It's pricey, slow to build, adds costs, relies on complex engineering, and sometimes fails to capture or store emissions effectively.'
"But there is one clear advantage to be gained from carbon capture and storage — it buys the oil and gas industry time. (The Tyee)

"Lessons from Australia show CCS is about capturing public opinion and public finances, not carbon" (National Observer)
"The principal purpose of CCS has never been to tackle the climate crisis. Instead, CCS serves to align public opinion and government policies with the fossil fuel industry's plans for unrestricted expansion under the cover of 'net-zero by 2050' rhetoric."

"Every Dollar Spent on This Climate Technology Is a Waste" (NY Times, 2022)
"What the technology, known as C.C.S., also does is allow for the continued production of oil and natural gas at a time when the world should be ending its dependence on fossil fuels.
"… But by promoting C.C.S., the fossil fuel industry is slowing the transition away from fossil fuels.

J.P. Morgan Bank: "One of the highest ratios in the world of energy science: the number of academic papers written on carbon sequestration divided by the actual amount of carbon sequestration (~0.1% of global emissions at last count)."

The Alberta Electric System Operator (AESO) does not have high hopes for carbon capture either:
"… Guilbeault also said all new gas-fired electricity generation after 2035 would require carbon capture technologies with a few exceptions. During his press conference Thursday, AESO president and CEO Mike Law expressed scepticism around the viability of such technology in the short-term.
"'Uncertainty with developing low-carbon technologies — whether carbon capture, hydrogen, small modular reactors — means AB is at a greater reliability and cost risk if cost and performance do not materialize as currently anticipated.'
"Premier Smith says Alberta preparing Sovereignty Act motion over federal emissions plans" (CBC, Sep 28, 2023)

Energy ecologist Vaclav Smil: "Mark my words, there'll be no massive sequestration of carbon. There hasn't been any, and there'll not be any next year, or 2025, or 2030."

The main purpose of CCS is to provide political cover for fossil fuel expansion and new projects. CCS merely perpetuates the oil industry. Fossil fuels for longer means more emissions, not less. Climate plans banking on fossil fuel expansion and carbon capture (CCS) are designed to fail.
Why invest scarce public resources in CCS, when far more cost-effective climate solutions are available?

Vaclav Smil has done the math. His books are dense but well worth a read. He does not hold back on commentary about those who have not done the math but still issue unsubstatiated opinions, whether from the O&G industry or environmental organizations. He has popped many balloons, some of them sacred.

Carbon capture is a red herring...among a lot of red herrings outfits like the Pathways Alliance are going to try to drag across the trail of climate science. I've been thinking of a movement to withhold the %age of my taxes that governments intend to give the richest industry on build too big not to fail unproven infrastructure....that is intended to extend the life of hydrocarbon burning across our beleaguered globe.

That would be real climate resistance.if we could pull together enough to pull it off.

Let the greenwashers build their own fantasy factories; public dollars should go to the just transition.

Look at the amount of public money that has fattened the obese carbon pig, even as one of the most profitable enterprises in history, the latest being a platinum-plated federal pipeline.

Just think what could have been done with that money, from building out public transit networks in Canada's top five cities or initiating the construction of thousands of publicly financed affordable rental housing or beefing up funding to medical schools for more doctors and nurses, to paying down a chunk of the national debt.

We need to encourage more long term thinking in our politics. CCUS is not a product of rational thought or the conceptualization of what is best for the commons. It is a product of commercial followership, not of public leadership.

In these calculations I don't believe anyone ever counts the emissions Canada's oil and gas sector export to other countries. I've never understood why this happens. It certainly conveniently benefits the countries that produce fossil fuels. The sector is a much worse contributor to climate change than this article implies.