Economic Potential of DACCS and Global CCS Progress
ENVIRONMENTAL, SOCIAL AND GOVERNANCE
In December 2021, Canada's Prime Minister, Justin Trudeau, directed Cabinet ministers
to move toward mandatory climate-related financial disclosures as part of Canada's
strategy to transition to net-zero by 2050 (5). The 2022 Budget included this mandatory
reporting requirement across a broad spectrum of the Canadian economy, based on the
international Task Force on Climate-related Financial Disclosures (TCFD) framework (6).
OTHER PROVINCES - ONTARIO
Hard-to-decarbonise sectors of Ontario's economy, such as steelmaking and cement, do
not have obvious paths to a carbon-neutral future. In these sectors, CCS likely provides
the most viable decarbonisation option. Therefore, the government is evaluating CO2
storage as a decarbonisation option. The likely storage area will be in the western part
of the province in saline aquifers. But existing laws prohibit storage, so the province
must revise the governing statutes by narrowing the prohibition on the injection of
CO2 into a well regulated under the Oil, Gas, and Salt Resources Act (Canada), and by
enabling authorisation to store carbon on Crown land under the Mining Act (Canada) (7).
PROJECTS
Canada's CCUS-specific action and strategy primarily lies in the provinces of Alberta
and Saskatchewan. Alberta is developing carbon storage hubs to help cut climate-
warming emissions by permanently sequestering CO2 underground. In March 2022,
the province selected six proposals to move forward with developing Canada's first
carbon storage hubs servicing Alberta's industrial heartland region near Edmonton.
The selected proposals came from: Enbridge Inc.; Shell Canada Limited; ATCO Energy
Solutions Ltd; Suncor Energy Inc.; Wolf Carbons Solutions; Bison Low Carbon Ventures;
Enhance Energy; and a joint-venture project from TC Energy and Pembina Pipeline
Corp. (8,9). Alberta's abundance of geological formations for CO2 storage makes it an
ideal location to develop a series of CCUS hubs (10).
Entropy Inc. announced that it has begun commissioning its first post-combustion CCS
project at the Glacier Gas Plant in Alberta. The project is considered to be the world's
first commercial project to capture and store carbon dioxide from the combustion of
natural gas (11).
The government of Saskatchewan's Ministry of Energy and Resources and others
will support a study, developed by the Transition Accelerator and the Saskatchewan
Research Council, to provide investors with an analysis of commercial-scale hydrogen
opportunities and synergies with CCUS infrastructure in Saskatchewan.
UNITED STATES
POLICY
The national climate goals of 100 per cent clean electricity by 2035 and achieving a net-
zero emissions economy by 2050 involve significant reliance on CCS. Through enacted
legislation in late 2021 and during 2022, the US committed to record investments into
carbon capture technologies, while also addressing environmental justice concerns.
LEGISLATIVE
In November 2021, the US enacted the Infrastructure Investment and Jobs Act (IIJA)
(US), which included over US$12 billion to be spent on CCS over the next five years.
The legislation includes funding for CCUS research, development, and demonstration,
CO2 transport and storage infrastructure, carbon utilisation market development and
four regional direct air capture with carbon storage (DACCS) hubs, and DAC Technology
Competition (12).
The US enacted the bipartisan Creating Helpful Incentives to Produce Semiconductors
for America fund in 2022, or the CHIPS Act (US). CHIPS provides funding for increased
carbon removal research, development and demonstration (13).
The US also enacted the historic Inflation Reduction Act (US) of 2022, which includes
enhancements to Internal Revenue Service section 45Q. The Act increases the credit
amount per tonne for entities satisfying prevailing wage and apprentice requirements
(14,15). The legislation also extends the start of construction timing to the end of 2032;
lowering capture thresholds, including direct pay; and expanding transferability.
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GLOBAL CCS
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