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

The document argues that carbon capture and storage (CCS) is an ineffective solution for Canada's oil and gas sector due to high costs, energy intensity, and a poor track record of delivery. It highlights that most Canadian CCS projects use captured carbon for enhanced oil recovery (EOR), which facilitates further oil production. Despite these failings, the Canadian government has provided billions in public funding, including a significant investment tax credit, which the authors suggest represents a high opportunity cost compared to more effective measures like methane reduction.

• CCS in Canada's oil and gas sector is largely used to facilitate further fossil fuel extraction rather than achieving absolute emission reductions, with approximately 70% of captured carbon in existing facilities used for enhanced oil recovery (EOR).
• The technology has a poor track record of performance and scale; seven operational CCS projects in Canada capture only about 0.5% of national emissions and approximately 1.3% of the oil and gas sector's pre-pandemic emissions.
• CCS is highly energy and capital intensive, with some projects costing as much as CAD 200 per tonne of carbon captured. It increases the energy demand of the facilities it serves by an average of 15%–25%.
• The Canadian government has provided substantial public funding for CCS, totaling at least CAD 9.1 billion to date, including a CCS Investment Tax Credit (ITC) estimated to cost CAD 8.6 billion over eight years.
• Canada's financial support for CCS is significantly higher than that of the U.S. Inflation Reduction Act (IRA); the Canadian ITC is estimated to provide double the subsidy amount offered via the IRA by 2030.
• CCS is an inefficient priority compared to other decarbonization measures; for example, methane reduction is estimated to cost only CAD 17 per tonne of greenhouse gas emissions under current Canadian regulations.
• CCS development timelines are incompatible with 1.5°C warming limits and 2030 targets because projects are slow to implement, often taking at least five years from announcement to operation.

APA

Cameron, L., & Carter, A. (2023). Why Carbon Capture and Storage Is Not a Net-Zero Solution for Canada’s Oil and Gas Sector. International Institute for Sustainable Development. https://www.iisd.org/system/files/2023-02/bottom-line-carbon-capture-not-net-zero-solution.pdf

Chicago

Cameron, Laura, and Angela Carter. Why Carbon Capture and Storage Is Not a Net-Zero Solution for Canada’s Oil and Gas Sector. International Institute for Sustainable Development, 2023. https://www.iisd.org/system/files/2023-02/bottom-line-carbon-capture-not-net-zero-solution.pdf.

Wikipedia

{{cite report |last1=Cameron |first1=Laura |last2=Carter |first2=Angela |title=Why Carbon Capture and Storage Is Not a Net-Zero Solution for Canada’s Oil and Gas Sector |publisher=International Institute for Sustainable Development |date=February 2023 |url=https://www.iisd.org/system/files/2023-02/bottom-line-carbon-capture-not-net-zero-solution.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{cameron2023why, author = {Cameron, Laura and Carter, Angela}, title = {{Why Carbon Capture and Storage Is Not a Net-Zero Solution for Canada’s Oil and Gas Sector}}, institution = {International Institute for Sustainable Development}, year = {2023}, month = feb, url = {https://www.iisd.org/system/files/2023-02/bottom-line-carbon-capture-not-net-zero-solution.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }