Canadian Scientists Urge Rejection of Carbon Capture
Tax Credit
A carbon capture pilot facility in Squamish, British Columbia, Canada.
Photographer: James MacDonald/Bloomberg
By Robert
Tuttle
January 19, 2022
Canada’s plans to introduce a tax credit for carbon capture in the
country’s oil patch would amount to a fossil fuel subsidy for an
ineffective technology, a group of academics said in a letter to the
deputy prime minister.
Carbon capture, where the carbon dioxide from oil and gas production
facilities is sequestered and injected back into the ground, is
economically unsound and has a “terrible track record” of delivering
emissions reductions, the Canadian academics and scientists said in
their letter to Chrystia Freeland. The money would amount to a subsidy
for the fossil fuel industry that would be better spent on renewable
energy, electrification and energy efficiency.
“The
introduction of this tax credit would contradict the promise made by
your government to Canadians during the election period to eliminate
fossil fuel subsidies by 2023 as well as our international commitments
under the Paris Agreement,” the group said in the letter.
The
federal government will probably include the tax
credit in the next budget and detail the goal to cut
emissions 40% to 45% below 2005 levels by March, Jonathan Wilkinson,
Canada’s natural resource minister, said in an interview this month.
Oil sands companies have announced a goal to zero out carbon emissions
from their operations by 2050, mostly through carbon capture with
government support, as their carbon intensive business faces
increasing scrutiny from climate-conscious investors.
Such
efforts would have little impact on the crude oil they produce and
ship to refineries for making fuel. The combustion of fuel accounts
for 80% of emissions stemming from oil and gas, which the industry’s
plan doesn’t address, Jason MacLean, a University of New Brunswick law
professor who co-signed the letter, said by phone.
“The
danger of using further public money to support oil and gas production
is that it will prolong and expand oil and gas production,” he said.
What’s more, if oil consumption plummets as the world moves
aggressively to decarbonize, the investment in carbon capture
infrastructure could create “stranded assets” as oil production in
Canada declines.
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