Budget earmarks clean-power dollars to Saskatchewan

subscribe

The federal government has committed $240-million to the construction of a clean-coal power plant in Saskatchewan that would capture carbon dioxide and then permanently store the greenhouse gas underground.

The Saskatchewan project is the signature investment of the government's budget effort to reduce greenhouse gas emissions blamed for climate change. The project would be the largest carbon capture and storage project in Canada, with a price tag of $3.8-billion for the 450-megawatt power plant. Power companies in Alberta and Nova Scotia, which rely heavily on coal, will be watching it closely.

The federal-provincial project - as well as financing for a proposed carbon pipeline in Alberta - signals mainstream support for carbon sequestration, a technology that until recently was relegated to the fringes of the climate change debate.

However, the technology still requires enormous upfront spending to capture the carbon dioxide emissions from industrial sources like power plants and oil sands upgraders, and government advisory panels have warned it is unlikely to be widely adopted until companies face stiff emission targets.

Ottawa is also encouraging the auto industry to invest in emissions-reducing technology by providing $250-million over five years to support research and development, and maintain Canadian jobs in the sector.

And it will spend $66-million over the next two years to develop the regulatory framework that will underpin a carbon emissions trading market in Canada. Finance Canada officials said the regulations will require companies to certify their carbon emissions and will validate emissions-reduction projects known as offsets that can be purchased by companies who can't otherwise meet their targets.

The Harper government has clearly identified carbon capture and storage as a key plank in a climate change effort that opposition parties and environmentalists have criticized as too lax.

"Carbon capture and storage presents an opportunity for Canada to develop world-leading technology that can significantly reduce greenhouse gas emissions," the government said in its budget document.

SaskPower, the provincially owned utility, has for years been considering constructing such a clean-coal power plant close to the oil fields of southern Saskatchewan, where the captured carbon dioxide can be used to enhance crude production.

Last summer, the utility announced it would proceed with several other projects to meet growing demand. It shelved the coal project because the estimated construction costs for the clean-coal plant had escalated too rapidly.

Since then, Saskatchewan has elected a new small-c conservative government that has improved relations with Ottawa after its battles with the previous NDP government.

In his budget, Finance Minister Jim Flaherty said the province is expected to match the federal funding for the coal project, which would be a commercial-scale demonstration project. SaskPower would be responsible for financing the balance of the cost.

Mr. Flaherty also announced new tax incentives for the oil and power sectors in Alberta to build a carbon capture and storage pipeline that could collect carbon dioxide at oil sands plants and power stations, and then deliver it to oil fields for enhanced recovery projects.

Environmentalist Aaron Freeman said the Flaherty budget contained some positive "green" measures, including a commitment to spend $500-million over two years on public transit and a clean-water initiative.

"But over all, we are not seeing in this budget that kind of priority that Canadians are placing on the environment," said Mr. Freeman, of Environmental Defence. He criticized the climate change effort as "very, very modest."

Related News

yukon wind

Yukon receives funding for new wind turbines

DESTRUCTION BAY, YUKON - Kluane First Nation in Yukon will receive a total of $3.1 million in funding from the federal government to install and operate wind turbines that will help reduce the community’s diesel reliance.

According to a release, the community will integrate three 100-kilowatt turbines in Destruction Bay, Yukon, providing a renewable energy source for their local power grid that will reduce greenhouse gas emissions and create local jobs.

A $2-million investment from Natural Resources Canada came from the Clean Energy for Rural and Remote Communities Program, part of the Government of Canada’s Investing in Canada infrastructure plan. Crown-Indigenous Relations’…

READ MORE

Transmission constraints impede incremental Quebec-to-US power deliveries

READ MORE

5g electricity

Is 5G a waste of electricity? Experts say it's complicated

READ MORE

carbon free future

Minnesota bill mandating 100% carbon-free electricity by 2040

READ MORE

offshore wind turbines

Next Offshore Wind in U.S. Can Compete With Gas, Developer Says

READ MORE