A Calgary-based clean-tech company wants to fight climate change by pulling carbon dioxide right out of the air. But without a nationwide price on carbon, direct air capture technology could be hampered by its hefty price tag.
Carbon Engineering is building a $4.5-million demonstration plant in Squamish, B.C., which is expected to pull 500 tonnes of CO2 out of the atmosphere every year. That’s equivalent to taking 200,000 cars off the road.
Direct air capture is similar to carbon capture and storage technology (CCS), except that CCS can only capturethe CO2 released from industrial smoke stacks, and not from the atmosphere itself.
Carbon Engineering plans to sell the captured CO2 for use in enhanced oil recovery, which involves injecting CO2 into underground reservoirs to force out the oil. In theory, enough CO2 could be sequestered in this way to completely offset the CO2 released by burning the fuel from that oil, meaning the fuel would be carbon-neutral.
“Really what we are going after are these transportation fuels,” said Geoff Holmes, Carbon Engineering’s business development manager, in an interview with the Squamish Chief. The transportation sector is responsible for nearly 30 per cent of Canada’s fossil-fuel emissions.
But direct air capture is expensive. Estimates of the cost per tonne of CO2 captured range from $100 to $1,000. The cost of CCS is much lower, estimated around $25 to $50 per tonne.
Carbon Engineering estimates that a barrel of oil produced using direct air capture and enhanced oil recovery would cost 20 per cent more than a barrel of conventional oil.
Holmes believes a nationwide price on carbon would make direct air capture more palatable. Currently, a handful of Canadian provinces have enacted carbon-pricing legislation, including B.C.’s carbon tax and Quebec’s cap-and-trade partnership with California.
But Holmes may have a while to wait for more progress at the federal level. In December 2013, Prime Minister Stephen Harper said it would be “crazy economic policy” to impose more regulations on the oil and gas industry. And he continues to refer to carbon taxes as “job-killing.”
Still, in an interview with Business in Vancouver, Holmes sounded determined.
“We’re doing the best we can to find niches that will support our technology in the absence of economy-wide policy,” he said.
A Carbon Tax Could Help Clean-tech Companies Pull Co2 from the Sky