The use of carbon capture, utilization, and storage (CCUS) technology as a key component of Canada’s climate policy is unlikely to meet the federal or provincial emissions goals, a new study suggests.
A Fraser Institute report published this week argues that the proposed scaling-up of carbon capture technology through Alberta’s Pathways project is unlikely to succeed because of the technology’s high costs, infrastructure needs, and mixed track record.
The findings come two months after Prime Minister Mark Carney and Alberta Premier Danielle Smith reached an agreement for a new West Coast oil pipeline in conjunction with the Pathways carbon capture and storage project in northeastern Alberta’s oilsands.
Ottawa and Alberta have agreed the pipeline will not proceed without development of the Pathways Project, which seeks to mitigate oilsands emissions and guarantee that heavy crude leaves Canada with a lower carbon intensity.
Fraser Institute Senior Fellow Kenneth P. Green, who authored the study, said the combination of existing technology, current knowledge, and historical applications of carbon capture technology raises doubts about its viability as fundamental climate policy.
“The idea that carbon capture, utilization and storage will provide large-scale carbon reduction is unlikely to be as successful as its proponents envision, at least with the technology as it exists today,” he said in a press release.
That’s because, historically, most CCUS projects have been developed to enhance oil and gas recovery rather than to store carbon, said Green, an expert in environmental science and engineering.
The technology has been “tested and deployed in numerous projects spanning many years,” he noted in his report. Approximately 73 percent of CCUS deployment has been used for Enhanced Oil Recovery (EOR)—a commercial method in which captured CO2 is injected underground to extract additional oil.
The application of this technology for true long-term greenhouse gas sequestration, as opposed to fossil fuel extraction, remains largely untested at scale and costs remain excessive, Green argued.
Large-scale CCUS projects have fallen short of expectations, he wrote, routinely capturing less than 80 percent of predicted capture levels and quantities. Green also noted that capturing carbon is only the first step. From there, the gas must be compressed, transported, and permanently stored.
Building the pipeline networks to move CO2 to suitable geological storage formations is a massive undertaking that comes with a prohibitive price tag, he said, adding that environmental opposition, local resistance, and regulatory hurdles could further increase costs and delay projects.
“Based on experience from both Canada and the United States, it is reasonable to expect significant resistance to the construction of CCUS pipelines by Canadian environmental groups and some local governments and public-interest organizations,” he wrote. “This, in turn, is likely to delay and increase the cost of developing the infrastructure necessary to adopt CCUS at scale in the Canadian context.”
Carney has called the pipeline-Pathways deal with Alberta a “grand bargain” and has described the Pathways Project as a “necessary condition” for pipeline approval.
The prime minister has not floated any figures about the overall cost of implementing carbon capture technology and Ottawa’s deal with Alberta did not update 2022 estimates that the first phase of the carbon capture project would cost $16.5 billion.
Carney has instead focused on the potential financial benefits of the Pathways Project and oil pipeline, saying in a speech last week that they will “catalyze well over $200 billion in direct investments in Canada and create over 175,000 new jobs across the country.”
