How Alberta’s CarbonTech Ecosystem Can Help Accelerate Canada’s Transition to NetZero
Leveraging Alberta’s CarbonTech Ecosystem, Climate Finance and Integrating Technologies to Accelerate Action
As a result of many complementary government and private sector initiatives underway in Alberta in the carbon-related technology (Carbon Tech) area, an ecosystem relating to this area has emerged in this province. Components of this ecosystem include research centres, business accelerators, technology demonstration centres, companies developing Carbon Tech, buyers, investors and funding agencies. At the same time, rapid and simultaneous advances in technologies in several complementary areas have occurred, which is enabling many innovative combinations to be integrated with each other to lower costs and maximize impact. The combination of these developments can be harnessed to help accelerate Canada’s transition to net zero carbon dioxide emissions (NetZero). To view an illustration of how this ecosystem can integrate complementary technologies and leverage climate finance to accelerate this transition, see below:
Advancements in several complementary technologies including power generation with carbon capture, biochar production, conversion of CO2 to renewable fuel, direct air capture, energy storage and renewable energy are now making it possible to create facilities that generate reliable energy with negative carbon emissions. For example, an existing biomass-fueled power station can be enhanced to include carbon capture, biochar production, conversion of CO2 to renewable fuel, energy storage and renewable energy. This set of enhancements will enable this facility to provide reliable power to the local electric grid, produce biochar and use its surplus power to produce renewable fuel. To view a simplified schematic of this example, see the below image:
The system shown above is only one configuration that includes a biomass-fueled power plant to produce reliable power and renewable fuel. The exact configuration will depend on the local regulatory framework and prices of products sold through long-term off-take agreements. For example, in BC, BC Hydro is not entering into power purchase agreements (PPAs) at this time (2022) but the natural gas companies in BC, such are FortisBC, are doing so.
There are many more ways complementary technologies can be integrated to lower costs and maximize impact. To view information about more technology combinations that produce reliable carbon-negative energy, visit: Integrating Technologies to Produce Reliable Carbon-Negative Energy. As well, there are technology combinations that produce food products and reliable electricity. To view information about some examples of these combinations, visit Integrating Technologies to Produce Agricultural Products and Reliable Electricity.
Since there are so many Carbon Tech options to choose from, it is hard for an individual or company in the private sector to select the best technology options for their specific project. To provide you with an idea of just how large and diverse the Carbon Tech industry has become, our team at Climate Solutions Advancement Network (ClimateSAN) prepared this webpage: Carbon Tech Companies and Related Information. In addition to many new technologies in the Carbon Tech area, there has been considerable development in many other areas. As a result, individuals and companies can greatly benefit by collaborating with organizations like Innovate Calgary at the University of Calgary to make the best choices for their respective project or projects.
In addition to Innovate Calgary, there are many more organizations that are helping to accelerate Carbon Tech in Alberta. Given below is a list of some of the leading ones in no particular order:
- Carbon Management Canada (CMC)
- Innovate Calgary
- Alberta Innovates
- Foresight Canada,
- Transition Accelerator
- Canadian Resource Innovation Network (CRIN)
- Petroleum Technology Alliance Canada (PTAC)
- Society of Petroleum Engineers
- Alberta Enterprise Group
- Modern Miracle Network
- DMG Events,
- Toronto Metropolitan University’s Centre of Urban Energy
- University of Waterloo’s Waterloo Institute for Sustainable Energy (WISE)
- York University’s Sustainable Energy Initiative (SEI)
- Pacific Institute for Climate Solutions (PICS)
In addition, there are other associations and alliances in Canada that would likely support initiatives to accelerate Carbon Tech across Canada. For example, the Canada Cleantech Alliance is a Canadian coalition of 22 clean-tech industry associations and accelerators representing over 2,000 cleantech manufacturers, innovators, investors, industry adopters and researchers across the country. This alliance includes associations such as the Ontario Clean Technology Industry Association and would likely be interested to support accelerating Carbon Tech in Canada.
Since there is so much activity in the development and implementation of technologies relating to carbon in Alberta, it can be argued that Alberta has become Canada’s “Silicon Valley” for Carbon Tech. Therefore, companies that do not want to miss out on the huge business opportunity in Carbon Tech, should explore how they can benefit from this ecosystem that has emerged in Alberta.
Carbon Tech development and large-scale implementation can likely be further accelerated if there is a collaboration between organizations across Canada. Since Alberta is already a leader in the Carbon Tech area, it seems beneficial if an organization in Alberta would take a leading role in encouraging collaboration between organizations across Canada in this area. This could include hosting a series of webinars about the Carbon Tech ecosystem along with some inspiring example technologies and funding options available.
Other countries have expressed interest in Alberta’s Carbon Tech, which can create export opportunities for Canadian companies specializing in this area. For example, the acting Nigerian Minister of Petroleum expressed interest in Carbon Tech from Alberta at the Global Energy Show in Calgary in June 2022. As a result, the Canadian Trade Commissioner Service indicated that it is now exploring options to host a webinar for West African countries about Carbon Tech from Canada.
In addition to collaborating with research centres, organizations can use software and services to help decide on the best combination of technologies. For example, RETScreen by NRCan is a clean energy management software platform that enables low-carbon planning, implementation, monitoring and reporting. As well, a new startup called Enermetrics compares hundreds of energy technologies to identify the optimal combination of solutions for an organization’s goals.
There are a considerable number of incentive programs to support Carbon Tech. Given below are some links to information about these programs:
a) Federal Gov’t Clean Growth Hub webpage summarizing federal programs for clean growth: Clean Growth Hub.
b) A range of funding programs for businesses by the Gov. of Canada: Grants and funding from the Government of Canada.
c) Environment-related funding: Environment and Climate Change Canada funding programs
d) A substantial funding program for indigenous communities: Indigenous clean fuels projects – Clean Fuels Fund
e) Tax credits allocated for carbon (CO2) capture, utilization, and storage (CCUS): Federal Budget Section about the CCUS Tax Credit
From 2022 through 2030, the investment tax credit rates would be set at:
- 60 percent for investment in equipment to capture CO2 in direct air capture projects;
- 50 percent for investment in equipment to capture CO2 in all other CCUS projects; and
- 37.5 percent for investment in equipment for transportation, storage and use.
- 60 percent for investment in equipment to capture CO2 in direct air capture projects;
f) Overview article about CCUS tax credits: Canada Introduces Tax Credit For CCUS Investments, Apr 11, 2022.
The forecasts about the expected growth of the carbon capture market is creating considerable investor interest in Carbon Tech (which includes CCUS). For example, in April of 2022, it was reported that Exxon sees carbon capture market at $4 trillion by 2050. Therefore, it is likely that companies implementing Carbon Tech can obtain an increasing amount of funding from private investors.
To implement Carbon Tech on a substantial scale, many large facilities utilizing these technologies will need to be funded. Fortunately, a pathway has emerged to help project developers obtain this funding. Prior to a substantial ($50m +) project getting funded, it can be certified as “Green Bond” eligible. After this facility becomes operational, it can be re-financed with a Green Bond that institutional investors can purchase. This enables the original investors to receive their capital back and build their next facility, which makes investing in this type of project much more attractive. In this way, large-scale climate action can be accelerated with private sector funding instead of government funding.
According to the ClimateBonds Initiative, over $500 billion in Green (Climate) Bonds were issued in 2021. This organization is now leading an initiative to increase this amount to $5 trillion in Green Bonds by 2025. There is a large pool of buyers of Green Bonds in the global financial system. For example, the members of The Glasgow Financial Alliance for Net Zero (GFANZ), which includes firms that collectively have over US$130 trillion under management, are likely buyers of this type of bond.
Since the Canadian Government has recently issued its new Clean Fuel Regulations, it will soon be possible to receive premium prices for renewable natural gas (RNG) across Canada. Therefore, projects designed to produce renewable fuels can soon be profitably implemented in many areas of Canada. As well, the federal government has recently launched its Greenhouse Gas Offset Credit System. Therefore, projects designed to reduce carbon emissions in Canada are now also able to generate considerable additional revenues.
To help organizations integrate complementary technologies to maximize climate impact and profits, Think Renewables Group has launched a new company called Integrated ClimateTech (iClimateTech). It will be starting by focusing on these types of projects: Integrating Technologies to Produce Reliable Carbon-Negative Energy and Integrating Technologies to Produce Agricultural Products and Reliable Electricity.
Think Renewables Group prepared some articles about combining complementary technologies to produce reliable energy with negative carbon emissions, which were published in industry magazines. To view these articles, visit:
a) Biomass Magazine article: How Companies Can Profitably Create Carbon-Negative Energy from Biomass, April 13, 2022.
b) OilPrice.com article: How Oil & Gas Companies Can Profitably Create Carbon-Negative Energy, January 5, 2022.