Why Carbon Capture and Storage Is Not a Net-Zero Solution for Canadas Oil and Gas Sector

This policy brief by the International Institute for Sustainable Development (IISD) argues that carbon capture and storage (CCS) is an ineffective and expensive strategy for decarbonizing Canada's oil and gas sector. The document highlights that CCS primarily addresses production-side emissions, often facilitates further oil extraction through enhanced oil recovery (EOR), and fails to address the majority of life-cycle emissions from downstream fuel use. Despite a poor track record of scalability and high costs, the Canadian government has provided billions in public funding, which the author contends represents a significant opportunity cost compared to more cost-effective solutions like methane reduction.

• CCS in Canada's oil and gas sector is limited in scope and efficacy, capturing only about 0.5% of national emissions. It only addresses production-side emissions, which represent roughly 15% of the total life-cycle emissions of oil and gas fuels, leaving the largest share—downstream end uses—unaddressed.
• A significant portion of carbon captured by CCS projects in Canada is used for enhanced oil recovery (EOR), which injects CO2 into declining oil fields to increase production. Approximately 70% of the carbon captured in existing Canadian CCS facilities is used for this purpose, effectively facilitating continued oil and gas production.
• CCS is characterized by high capital and energy intensity. The process of capture and compression alone requires 330–420 kWh per tonne of CO2, increasing the energy demand of the host facility by an average of 15%–25%. Costs are high and variable, ranging from CAD 50 per tonne for natural gas processing to CAD 200 per tonne for the Quest project up to 2021.
• The Canadian government has provided substantial financial support for CCS, totaling at least CAD 9.1 billion in public funds to date, including CAD 3.8 billion from Alberta and Saskatchewan. The federal CCS Investment Tax Credit (ITC) is estimated to cost CAD 8.6 billion over its first eight years, which the document notes is double the subsidy amount offered for CCS via the U.S. Inflation Reduction Act by 2030.
• CCS has a poor track record of delivery both in Canada and globally. Globally, only 30 commercial CCS projects were operating as of September 2022, capturing 42.5 Mtpa, far below the IEA's 2009 target of 300 Mtpa by 2020. In the U.S., over 80% of proposed CCS projects failed to become operational.
• CCS is an inefficient investment compared to other decarbonization measures. For example, methane reduction is estimated to cost CAD 17 per tonne of greenhouse gas emissions under current Canadian regulations, making it a more cost-effective near-term solution than CCS.
• The timelines for CCS deployment are incompatible with 1.5°C warming limits and Canada's 2030 emissions targets. Commercial projects in Canada have taken at least 5 years to move from announcement to storage; for instance, the Boundary Dam project was approved in 2008 but did not operate until 2014.

APA

Cameron,, A. C. (2023). Why Carbon Capture and Storage Is Not a Net-Zero Solution for Canadas Oil and Gas Sector. International Institute for Sustainable Development. https://www.iisd.org/articles/deep-dive/carbon-capture-not-net-zero-solution

Chicago

Cameron,, Angela Carter,Laura. Why Carbon Capture and Storage Is Not a Net-Zero Solution for Canadas Oil and Gas Sector. International Institute for Sustainable Development, 2023. https://www.iisd.org/articles/deep-dive/carbon-capture-not-net-zero-solution.

Wikipedia

{{cite report |last1=Cameron, |first1=Angela Carter,Laura |title=Why Carbon Capture and Storage Is Not a Net-Zero Solution for Canadas Oil and Gas Sector |publisher=International Institute for Sustainable Development |date=9 February 2023 |url=https://www.iisd.org/articles/deep-dive/carbon-capture-not-net-zero-solution |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{cameron2023why, author = {Cameron,, Angela Carter,Laura}, title = {{Why Carbon Capture and Storage Is Not a Net-Zero Solution for Canadas Oil and Gas Sector}}, institution = {International Institute for Sustainable Development}, year = {2023}, month = feb, url = {https://www.iisd.org/articles/deep-dive/carbon-capture-not-net-zero-solution}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }