Canada prepares carbon capture credit, the emissions plan

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Canada prepares to launch a tax credit for investments in carbon capture, a key step in reducing greenhouse gas emissions from its tar sands, and will soon outline its 2030 targets for reducing pollution.

The federal government is likely to include the tax credit in the next budget and detail its goal of reducing emissions from 40% to 45% below 2005 levels by March, said Jonathan Wilkinson, Canadian Minister of Natural Resources. , in a telephone interview.

Tar sands companies said zeroing carbon emissions from their operations could cost C $ 75 billion ($ 60 billion), mostly for carbon capture projects, which could require up to two-thirds of the capital provided. through government support.

The tax incentive would be like that offered in the United States, Wilkinson said. The credit would exclude carbon capture that is used to increase oil production, called advanced oil recovery.

Canada will detail a plan to further reduce emissions by 2050, Wilkinson said.

The government also plans to announce a cap on emissions from oil and gas plants as early as this year, in line with Prime Minister Justin Trudeau’s election commitment.

The tar sands industry has already adopted a 100 megatonnes cap on emissions that is well above current levels, but the federal government limit would be lower, closer to current emissions, and lowered over time, he said. the minister.

© 2022 Bloomberg LP

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