An analyst believes that Capital Power’s decision to halt Canada’s largest carbon capture and storage project is due to financial uncertainty and technological risks. The project at the Genesee power plant near Edmonton was set to cost $2.4 billion and capture three million tonnes of carbon dioxide annually. However, Capital Power CEO Avik Dey stated that the project’s economics were not feasible.
According to Scott MacDougall of the Pembina Institute, the uncertainty surrounding carbon credits and carbon pricing likely influenced Capital Power’s decision. The company would have been the first to implement this technology in a gas plant, which introduces additional risks and costs. Despite this setback, MacDougall does not anticipate other carbon capture projects being put on hold. He believes that the technology is more established in other industries, reducing the associated risks.
This development marks a significant shift in the ongoing efforts to combat climate change through carbon capture technology. While some obstacles remain, such as financial uncertainties and technological risks, it is crucial for companies like Capital Power to continue exploring innovative solutions for reducing carbon emissions. By addressing these challenges head-on, the energy sector can play a critical role in transitioning towards a more sustainable future.