Key Takeaways:
- Alberta can have another pipeline to the West Coast, but only if the oil and gas industry implements carbon capture systems to ensure low-emission bitumen.
- The federal government’s support for the new pipeline is contingent on the success of a massive carbon capture project being pitched by the Pathways Alliance.
- Carbon capture technology can help reduce emissions, but it is not a silver bullet in the fight against climate change.
- The technology is expensive and requires significant government subsidies.
- The use of oil products, not just their production, is a major contributor to greenhouse gas emissions.
Introduction to Carbon Capture
Alberta can have another pipeline to the West Coast, but only if the oil and gas industry puts carbon capture systems in place to ensure the bitumen that flows through it is "low-emission." This tradeoff is at the heart of the "grand bargain" unveiled by Alberta Premier Danielle Smith and Prime Minister Mark Carney in November 2025. The memorandum of understanding expressed support in principle for a new pipeline to connect Alberta’s landlocked oilsands to international markets. The bitumen that flows through the pipeline will be cleaner than what currently flows through Alberta’s pipelines, not because of the product itself, but because of the processes used to create it.
What is Carbon Capture and Storage?
Carbon capture, utilization, and storage (CCUS or CCS) technologies capture carbon before it escapes into the atmosphere and then bury it deep underground or repurpose it to make other products. These systems are designed to capture 90% of the emissions produced by an industrial process, but early carbon capture projects in Canada have failed to achieve that threshold. Captured carbon can’t be stored just anywhere; it requires a porous rock formation deep underground and an impermeable "cap-rock" layer to seal the carbon in for centuries to come. Many sites where oil has previously been removed prove suitable for carbon storage, which is why the Prairie provinces have been the epicentre of carbon storage activities in Canada.
Existing Carbon Capture Projects
There are a few dozen carbon capture, utilization, and storage projects in operation around the world, but they’ve yet to reach a scale that would make a meaningful dent in emissions. According to the Global CCS Institute, existing projects have the capacity to capture about 64 million tonnes of carbon per year, which is about 0.1% of global emissions. The Pathways Alliance proposal doesn’t include the actual capture of any carbon; rather, it’s a plan for a shared carbon transportation network and storage facility, with individual companies expected to build their own infrastructure for capturing carbon at their facilities and feeding it into the Pathways network. The companies stated in 2023 that their project could lead to a net reduction of between 10 and 12 megatonnes of emissions per year by 2030.
Government Support for Carbon Capture Technology
Canadian governments are supporting carbon capture technology by paying for it. The cost to build carbon capture, utilization, and storage facilities typically runs into the billions of dollars, and operational expenses can be tens of millions of dollars per year. The federal government has introduced a refundable tax credit that subsidizes up to 50% of the cost of eligible carbon capture, storage, and utilization projects. The Alberta Carbon Capture Incentive Program provides additional provincial grants to companies building carbon capture projects in Alberta. In Carney and Smith’s memorandum of understanding, both the federal and Alberta governments committed to extending their respective incentive programs to support the Pathways project, which means a significant portion of the megaproject’s $16-billion price tag is likely to be publicly funded.
Can Carbon Capture Technology Make a Dent in Climate Change?
On its own, carbon capture technology cannot make a significant dent in climate change. Combined with other efforts, especially an overall reduction in fossil fuel use, it might help a little. The United Nations Intergovernmental Panel on Climate Change has said the technology has the potential to decrease global emissions, but not by anywhere near as much as transitioning to renewable energy sources such as wind and solar. According to the International Energy Agency, carbon capture, utilization, and storage could achieve 8% of the emissions reductions needed to reach net-zero in the energy sector by 2050. However, the technology is expensive and requires significant government subsidies, and it does not address the emissions produced by the use of oil products, which account for 70-80% of the carbon footprint associated with a barrel of oil.
Conclusion
In conclusion, while carbon capture technology can help reduce emissions, it is not a silver bullet in the fight against climate change. The technology is expensive, requires significant government subsidies, and does not address the emissions produced by the use of oil products. The Alberta government estimates that the province has about 160 billion barrels of oil still available for extraction in the oilsands, and the new pipeline, if it ever gets built, will drastically increase the amount of bitumen that can be shipped to international markets. By that time, Canada’s billion-dollar investments into carbon capture, utilization, and storage technologies might have helped clean up the industries that produce oil in Alberta, but they will have done nothing to address the bigger problem: the use of the oil products themselves.
