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Gas, Oil Profits to Fund Alberta's C$2B Carbon Capture Plans

Looking to advance its climate change action plan, Alberta's government will create a C$2 billion fund to advance carbon dioxide (CO2) capture and storage (CCS) projects, and a second C$2 billion fund for public transit projects to get cars off the province's roads, Premier Ed Stelmach said.

"We're tackling both sides of the emissions challenge on behalf of Albertans and all Canadians," Stelmach said. "We're reducing the impact of industrial emissions with carbon capture and storage and investing in public transit to reduce the impact from our tailpipes."

Funds for the two initiatives will come from Alberta's 2008 surplus, which the province expects will be significantly larger than predicted due to higher-than-forecast oil and gas prices, Stelmach said.

The first fund will be used to encourage construction of Alberta's first large-scale CCS projects. The province has issued a request for expressions of interest to begin identifying those CCS proposals with the greatest potential of being built quickly and those that provide the best opportunities to significantly reduce greenhouse gas (GHG) emissions. With the potential to reduce emissions at facilities such as coal-fired electricity plants and oil sands extraction sites and upgraders, the C$2 billion fund will support projects that are expected to reduce emissions by up to five million metric tons annually, Stelmach said.

Alberta's Climate Change Action Plan, which the province expects will cut projected GHG emissions in half by 2050, is based on carbon capture and storage, energy conservation and efficiency, and greening energy production.

Earlier this year TransAlta Corp. and Alstom agreed to work together to develop a large-scale CCS facility in Alberta. The project will pilot Alstom's proprietary chilled ammonia process. The plan is to test the technology at one of TransAlta's coal-fired generating stations west of Edmonton and reduce current CO2 emissions by one million metric tons per year.

In March, Prime Minister Stephen Harper said the Canadian government would partner with the province of Saskatchewan to develop one of the world's first and largest commercial-scale CO2 capture and storage demonstration projects. That project is to be at the SaskPower Boundary Dam Power Station.

Last year Harper and Stelmach announced the formation of the Canada-Alberta ecoENERGY Carbon Capture and Storage Task Force to recommend the best ways for Canada to implement the technology on a large scale. TransAlta CEO Steve Snyder is heading the task force.

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