As one Canadian company has learned the hard way, taking carbon out of the atmosphere is easier said than done.
What happened: Alberta’s Capital Power is scrapping its $2.4 billion carbon capture project, one of the largest in Canada. The decision to pull the plug for financial reasons is another red flag about the long-term viability of carbon capture.
- The impact of this decision could have major implications for Ottawa, which has invested heavily in the technology and is pinning near-term climate goals on carbon capture eventually working at scale.
Catch-up: The feds have already committed a lot of resources to carbon capture projects, including covering up to 50% of capital costs and launching an industrial carbon-pricing system to jump-start the carbon credit market.
- The carbon credit market — which largely underpins the economic viability of carbon capture as a long-term solution — would allow businesses to offset their emissions by paying to have a certain amount of CO2 taken out of the atmosphere.
Why it matters: Despite the efforts of policymakers to make them economically viable, large-scale carbon capture projects have yet to deliver on their promise.
- Canada’s only large-scale carbon capture facility installed on a power plant is at Saskatchewan’s Boundary Dam coal-fired plant, and it has been plagued by technical problems.
- One report found that to achieve the federal government’s climate goals, natural gas and coal plants would need to install carbon capture that works more effectively than any existing system in the world.
Bottom line: The promise of carbon capture may not have been realized yet, but it will likely have to be if net-zero emissions goals are going to be hit in the coming decades.—LA