With the goal of decarbonisation, carbon capture, utilization, and storage (CCUS) is an important area for growth and development. On November 28, 2023, the Government of Alberta (Province) announced key incentives for the development and integration of CCUS infrastructure and technology in Alberta. Specifically, the Province announced the creation of the Alberta Carbon Capture Incentive Program (ACCIP) as part of Alberta's Emissions Reduction and Energy Plan.
The ACCIP is intended to incentivize facilities to incorporate CCUS infrastructure and technology into their operations Between 2024 and 2035, the program will offer between $3.2 to $5.3 billion in financial. The announcement of the ACCIP follows the incentives announced by the federal government in the Fall Economic Statement 2023, which includes the CCUS investment tax credit program (CCUS ITC).
Main Features
The main features of the ACCIP are:
- A grant of 12 per cent for new eligible CCUS capital costs which will be paid to operators in three installments over three years, after the first year of operation. This structure is similar to that used by the Alberta Petrochemical Incentives Program.
- Portions of the funding for the ACCIP will come from the Technology Innovation and Emission Reduction Fund.
- Provincial funding will be available after the federal government enacts the CCUS ITC and associated operational aids, such as contracts for difference. The ACCIP will be structured to supplement the federal CCUS ITC.
Eligibility
Facilities across various sectors will be eligible including, oil sands, oil and gas production, enhanced oil recovery production, petrochemical, power generation, manufacturing, cement production, and more.
Next Steps
The Province is in the process of finalizing the specifics of the ACCIP, and further information is expected to be available in spring 2024. As further updates are announced, we will continue to monitor developments in respect of the ACCIP and CCUS ITC. To discuss any questions about the ACCIP or the CCUS ITC, please contact your trusted McCarthy Tétrault advisor or one of the authors.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.