CCS in Canada
- Energy profile
- Policy environment
- Status of CCS
- Members of the Institute
- Global CCS Institute activities in Canada
Canada is a confederation of 10 provinces and three territories. The country’s constitution gives the provinces jurisdiction to regulate the development, conservation and management of natural resources, including energy. While Canada has the second largest land mass of all countries, its population is 34 million, ranking it 36th globally. Canada is a relatively small open economy – with a GDP of $1.4 trillion, ranking 15th globally. About 10 per cent of the economy is energy related.
Canada’s total greenhouse gas (GHG) emissions peaked in 2006 at 751 MtCO2e, of which 560 Mt were energy related. It ranks eighth in the world in emissions, but accounts for only about 2 per cent of global emissions. The country’s GHG emissions have slowly declined since 2006, as the government seeks a 17 per cent reduction to 607 Mt CO2e by 2020, consistent with the US target and Canada’s commitment at Copenhagen in 2009.
With over CA$2 billion allocated for the development of CCS, and one of the world’s largest operating CCS projects, Canada has demonstrated a commitment to CCS as part of its approach to reducing GHG emissions.
Over the past decade, crude oil production has steadily increased to about 2.7 million barrels per day (MBOPD), over half of which is produced from the oil sands. While western Canada is the major source of crude oil, Newfoundland and Labrador represent about 10 per cent of crude oil supply. Enhanced oil recovery (EOR), using CO2, accounts for 28,000 BOPD. Canada holds the world’s third largest oil reserves (175 billion barrels), behind Saudi Arabia and Venezuela.
In 2010, Canadian natural gas production was 6.2 trillion cubic feet (Tcf), it has been declining over the past 10 years, as conventional gas production declines. Reserves of conventional natural gas are estimated to be 69 Tcf, the majority of which are in Western Canada. Shale gas resources could be as much as 1,000 Tcf.
Electricity production in Canada is diverse, with over 60 per cent being generated hydraulically. Steam-fired electricity generation comes overwhelmingly from coal. The majority of nuclear power is generated in Ontario.
Petroleum-based products comprise the largest share of primary energy demand, largely in the transportation sector, followed by natural gas, which is mostly consumed in the residential, commercial and industrial sectors. As noted above, hydro, nuclear and coal supply the electricity sector.
Canada is a major exporter of energy; most of its crude oil (1.9 MBOPD) and natural gas (3.3 Tcf) exports are destined for the US. Additionally, there is significant trade in electricity between the two countries.
* Numbers may not sum to 100 percent due to rounding. Source: Statistics Canada, Survey 2151, 2010
Transportation is the largest single sector, followed by fossil fuel production, driven in part by the oil sands.
There are over 100 large stationary sources of GHG emissions, totaling about 220 Mt, or about 40 per cent of Canada’s energy-related emissions. From each these sources, the individual industrial emissions are greater than 0.5 Mt annually, whereas the power generation emissions are greater than 1 Mt.
The recently published North American Carbon Storage Atlas Project (a joint venture among Canada, Mexico and the US) estimated approximately 132 Gt of potential CO2 storage in Canada, the majority of which (110 Gt) is in saline formations. Moreover, about 90 per cent is in two Western Provinces (Alberta and Saskatchewan).
Canada signed the Kyoto Protocol in 1997 and ratified it in 2002. However, the country has hesitated on implementing policies to reduce GHG emissions, and in 2011 it became the first signatory from the developed world to announce its withdrawal from the Protocol.
The Government of Canada has indicated it will harmonise its GHG emission reduction policies with those of the US, but there has been little progress, as the US congress has made no progress on this issue for the past four years. An early area of cooperation with the US is the Clean Energy Dialogue (CED) in which both countries have agreed to develop GHG mitigation technologies, including CCS.
The following initiatives impact the development of CCS in Canada.
- The Province of British Columbia passed – but has not enacted – a cap-and-trade scheme under the Greenhouse Gas Reduction (Cap and Trade) Act, which remains capable of integration with the Western Climate Initiative’s (WCI) proposed plan. Carbon dioxide taxes apply to virtually all fossil fuels in British Columbia
- The Alberta Climate Change and Emissions Management Amendment Act came into force on 1 July, 2007, and provides for a “made-in-Alberta” cap-and-trade scheme applicable to all emitters of more than 100,000 tonnes of CO2 annually. Alberta also introduced The Carbon Capture and Storage Statutes Amendment Act (Bill 24) to address some significant barriers to deploying CCS. It was passed into law by 1 December, 2010. In March, 2011, it launched the Regulatory Framework Assessment project to establishe world class regulations for CCS. The project will report to the Alberta Minster of Energy in December, 2012.
- In December, 2009, Saskatchewan introduced its climate change plan: The Management and Reduction of Greenhouse Gases and Climate Change Act. Its target is to reduce provincial emissions by 20 per cent from 2006 levels by 2020. The main elements seek to regulate emitters over 50 Kt annually and to provide a carbon price of CA$20 p/t for those emitters – the proceeds of which will be paid into a Technology Fund. CCS is an important piece of Saskatchewan’s emissions reduction. The province, through the Department of Energy and Resources, will develop new regulations based on the existing regulations in the oil and gas sector.
- Manitoba is considering framework legislation cap-and-trade for the WCI.
- Ontario’s climate change action plan, introduced in 2007, targets a 6 per cent reduction below 1990 levels by 2014, 15 per cent by 2020 and 80 per cent by 2050. The Green Energy and Economy Act was introduced in 2010. Its key features are: incentives for energy efficient products; expanding the use of renewable energy (wind, solar, hydro, biomass and biogas); participating in the WCI cap-and-trade system; and phasing out its coal fired power generation. CCS is not in the Ontario action plan.
- In November, 2009, Québec unveiled its target to reduce GHG by 20 per cent below 1990 levels by the year 2020. This is the most ambitious goal in Canada and is similar to the target established by the European Union. Principal strategies for reduction include (a) the use of renewable fuels, especially biomass conversion, (b) energy efficiency, particularly mass transit and (c) participation in the WCI cap-and-trade system. Quebec has a carbon tax on transportation fuels; it has no policy for CCS.
- in 2010, Nova Scotia introduced The Environmental Goal and Sustainable Prosperity Act. It has an emissions reduction target of 10 per cent, relative to 1990, by 2020. Energy efficiency and renewables are large features of the reductions. It notes that 46 per cent of emissions come from the power sector, which will be reduced by imposing increasingly more stringent caps on NS Power, and it refers briefly to CCS as an option for reductions.
- In 2008, the Alberta Government-appointed CCS Development Council recommended that CA$2 billion be committed to commercial CCS projects. Following that report, both the Federal and Alberta governments have provided significant funding for the deployment of CCS technologies, including US$562 million in Canada’s Action Plan for stimulating the economy. Alberta also committed US$1.73 billion to encourage the construction of the province’s first large-scale CCS projects.
- The Emissions Performance Standards for Coal-fired Electricity Generation, issues by the Canadian government, which went into effect in September, 2012. According to the standard, which went into effect in September, 2012, new coal plants must meet the emissions level equivalent to a high efficiency natural gas combined cycle unit, or 420 tonnes CO2 per GWh.
Canada is home to seven large-scale CCS projects:
- two are in the planning phase,
- four are under construction; and
- the Weyburn/Midale EOR project in Saskatchewan, the largest of its kind, is operational.
The Institute has 17 Canadian-based members, representing a cross section of government (Federal and Provincial), industry and academia. Members include:
Government and Academia
- The Government of Canada
- The Government of Alberta
- The Government of Saskatchewan
- Alberta Innovates - Technology Futures
- Canadian Clean Power Coalition
- Carbon Capture and Storage Research Consortium Nova Scotia
- Carbon Management Canada
- IPAC– CO2 Research Inc.
- Petroleum Technology Research Centre
- ARC Resources
- CO2 Solution Inc.
- Enbridge Inc.
- Enhance Energy Inc.
- HTC Purenergy Inc
- Integrated CO2 Network
- North West Redwater Partnership
To demonstrate the Institute’s support of CCS in Canada, the Institute is engaged in the following activities:
- AU$5 million in funding to TransAlta for specific deliverables related to Project Pioneer;
- staff support on two Working Groups and the Steering Committee for the Alberta Regulatory Framework Assessment project to develop CCS regulations; and
- participation in the Enbridge CO2 Slurry Pipeline project and the Alberta CO2 Purity Project sponsored by the Petroleum Technology Alliance of Canada.