Scrapping the federal government’s investment tax credit for carbon capture, utilization, and storage emissions by 2050—a goal that Ottawa reaffirmed in November in the COP 26 Glasgow Climate Pact.
The letter argues that we should focus on other climate solutions already being implemented to help reduce GHG emissions, such as increased electrification, the wide-scale use of renewable energy, and intensifying energy efficiency.
The usefulness of these technologies has been recognized by the federal government, and they are currently responsible for capturing and storing at least 4 million tonnes of carbon per year in Canada alone.
Yes, a refundable tax credit can act as a subsidy when a firm has no taxable income; it also tends to do so with small to mid-size enterprises that likely face larger hurdles to entering the market for CCUS in the first place.
Next, the investment tax credit is not targeted at the oil and gas industry.
These sectors are also growing, with global cement demand projected to increase by 12 percent to 23 percent by 2050, and global steel demand by 15 percent to 40 percent.
Encouraging CCUS is not only in our best interest but with almost 200 signatories to the Glasgow Climate Pact, we also need to consider that coordinated and complementary actions will help us reach the government’s goals.
One of the concerns raised by the group is that the technology is not necessarily available on the time scale we need.