Madam Speaker, it is always an honour to rise on behalf of the constituents of Souris—Moose Mountain.
I am happy to speak today on Bill C-262, and I would like to thank my colleague, the member for Calgary Centre, for introducing it.
Carbon capture, utilization and storage, or CCUS, is something that I personally have been championing since I was first elected as an MP in 2015. To me, it is a clear way forward when it comes to protecting the environment while also ensuring that we are supporting Canada's economy.
My home town of Estevan in Saskatchewan is home to SaskPower's Boundary Dam, a CCUS facility. It is the world's first CCUS facility to be fully integrated with the coal-fired power plant. The development and implementation of CCUS on Unit #3 of Boundary Dam established Canada as a world leader in this emissions-reducing technology, and this bill would go a long way to expand CCUS into other regions and industries in this country.
I have been fortunate to tour the Boundary Dam facility a number of times throughout my time as an MP, and I am always thoroughly impressed by their hard work. Since the CCUS facility went online in October 2014, over four million tonnes of CO2 have been captured and sequestered, which is the equivalent of one million cars being taken off the road. Also, there is storage space for over 400 billion tonnes in the Alberta and Williston basins. Thanks to this incredible technology, these emissions have been captured and put to use in other industries, such as oil and gas with enhanced oil recovery.
Furthermore, the fly ash that is created as a by-product of the process is captured and sold as a necessary component for things like cement production. Modern's concrete contains about 25% fly ash, a cementitious content, reducing its emissions. We know that this technology is a proven solution to reducing global greenhouse gas emissions.
The International Energy Agency has listed CCUS as the third most important measure needed for the world to meet its Paris agreement targets. Therefore, the assertion that this is one of the best ways to reduce emissions going forward is valid and has been extensively researched. However, the issue that Canada faces now is a lack of incentive for private investment, but Bill C-262 aims to address this matter through the development of a tax credit.
As I stated earlier, Canada has always been seen as a world leader in the development and implementation of CCUS. However, that has started to shift over recent years. Our American neighbours to the south have a measure called the “45Q”, which allows the sharing of tax credits associated with the cost required for the successful capture, utilization and storage of CO2 emissions. This tax credit has been widely successful in the U.S. to the point that it has driven private investment away from Canada due to the lack of competitive policies on our end. This is unacceptable, especially considering the need to revitalize Canada's economy in every way we can following the COVID-19 pandemic. I am very pleased that my colleague has introduced the bill in an attempt to level the playing field and rectify this situation.
In its policy paper of July 2020, the Energy Future Forum stated the following with respect to Canada's involved in CCUS. It said:
It is critical that Canada maintain and advance its leadership position in carbon capture. It must be understood as part of a broader strategy to sustain our comparative advantage as a leading energy-exporting nation and reliable, responsible resource developer. Our commitment to the ongoing reduction of emissions and the attainment of the highest levels of the environment, social and governance standards and performance, must be evidenced in our industry activities. This carbon capture policy initiative points to a serious opportunity for government and industry collaboration.
I emphasize that the bill and the discussion surrounding it are a necessary and long overdue first step towards wider-scale use of CCUS technology across multiple industries. Again, it is a first step, and while much more will need to be done to fully integrate CCUS into the fabric of Canada's emissions reduction policies, we need to start somewhere.
Unlike the Liberals who just continue to introduce ineffective measures like their carbon tax, we Conservatives understand that Canada can, once again, become a world leader in CCUS so long as we can provide the proper incentives for investment.
I would like to summarize the recommendations that were made by the Energy Future Forum in its policy paper, which I mentioned earlier.
One, the federal government and provincial governments should clearly signal that CCUS is integral in Canada's climate change policy framework.
Two, the federal tax policies should meet or exceed the U.S. measures such as the aforementioned 45Q tax credit in order to attract private investment to Canada.
Three, that the federal and provincial governments work together to establish stackable tax credits with respect to CCUS.
Four, that the Canada Infrastructure Bank standards reward carbon reduction strategies in the allocation of capital.
Five, that all levels of government work together to implement a strong regulatory framework.
Six, that we create financing vehicles such as a green transition bond, public-private partnerships and equity investments by federal and provincial governments in the Canada Infrastructure Bank to help attract private investment into the CCS sector.
These recommendations provide a solid basis for encouraging and increasing private sector investment into CCS technology in Canada, and it is clear now is the time to act.
The Liberals have failed to show any meaningful leadership on this issue, despite industry stakeholders calling for it. To put it bluntly, they talk the talk, but they do not walk the walk. We see this when major companies continue to choose to do business in the U.S. rather than in Canada.
We know the landscape of Canadian and energy production and emissions reduction is always changing, and this is something I see in my riding day in and day out. As the world moves away from coal-fired power, we need to ensure there are viable options for those whose industries and jobs will be transitioning as well. This includes power plant workers, miners, geologists and many more. Unfortunately, they have received little or no help from the government, despite Liberals' promises to the contrary.
The Canada coal transition initiative committed to help with the transition through measures such as pension bridging, but we have yet to see any such program be implemented. This leaves many Canadians uncertain about their futures, something that could be at least partially offset by encouraging investment into CCUS technology.
The construction of a CCUS facility alone has the potential to create hundreds of jobs, with many continuing on a more permanent basis for the management and maintenance of such facilities. Not only is this creating good, high-paying, private industry jobs for those directly employed in CCUS, it also bolsters the local economies where these facilities are located.
We also know, thanks to “The Shand CCS Feasibility Study”, conducted by the International CCS Knowledge Centre, that CCUS is becoming more affordable. Implementing CCUS technology on the Shand Power Station in my riding, in comparison to the cost of the Boundary Dam facility, could be done at 67% less per tonne of CO2 capture, a significant reduction thanks to the lessons learned from the building and operation of CCUS unit 3.
The cost of capture of CO2 would be $45 U.S. per tonne, which is far less than the $170 per tonne the Liberals are implementing, regardless of the exchange rates. As mentioned, cement factories are some of the heaviest emitters worldwide. The CCUS byproduct of fly ash could reduce their emissions up to 25%.
CCUS can also be used to reduce emissions in steel production, another major Canadian resource. It is a simple fact that opportunities for sequestration in Canada are considered some of the best in the world, and we must take full advantage of that by incentivizing investment.
This bill and this tax credit would do just this that. Given the Liberals' assertion that the environment and the economy must go hand in hand, it would be logical that they support this important first step toward large-scale investment into CCUS projects.
According to an assessment provided by industry stakeholders, and modelling by Capital Power, the deployment of six CCS plants would result in roughly $1.4 billion in foregone tax revenue. At the same time, it would lead to approximately $5.5 billion of private sector investment, with six megatonnes of greenhouse gas emissions being captured each year.
We know the economic impact is substantial, with projections stating that just a few CCS projects over four years would generate $2.7 billion in GDP across Canada and support 6,100 jobs. However, we, as the opposition, are unable to do this alone. Given the importance of reducing our greenhouse gas emissions to all the parties in this House, I would hope and encourage that we come together and make this initiative a real priority.
Canadians expect their government to do what is best for them, and Bill C-262 would help secure the future and health of our economy, while also addressing the issue of emissions reduction. I therefore call on members of the House to support this bill and help to move Canada's leadership in this technology forward.