Carbon capture is not real progress

The Alberta NDP did the right thing in not pulling the plug on the money the government and the Shell corporation had already spent on its Quest carbon capture and storage facility near Fort Saskatchewan. It wasn't the best thing, but it was the right thing, a start.

For about $1.3 billion, Quest will strip carbon dioxide out of “process gas streams” at the Scottford Upgrader and shove it deep underground. That's not the same as stripping carbon from its waste gases, or from the exhaust of all the vehicles that will burn the gasoline and diesel Scottford's customers will refine down the pipeline.

But it's an easy meme to say the process is the yearly equivalent of taking 250,000 cars off the road. I figure that's less than all the cars, trucks and buses in Edmonton.

The Alberta government, under the previous Conservative regime, dedicated $745 million to the project over its first 10 years. The federal government gave $120 million, and the rest is coming from Shell and its Athabasca Oil Sands partners Chevron Canada and Marathon Oil.

The government needs something for show and tell at the Paris conference on climate change. This, along with Saskatchewan's similar project are at least something large to put on the table.

But even Shell CEO Ben van Beurden allowed this wasn't the best possible arrangement. For carbon capture to grow — a very real necessity if Shell is to continue extracting oil in the future — van Beurden says there needs to be an economic imperative.

He means a price on carbon of between $60 and $80 a tonne. This cost, tacked onto the price of our fuel and electricity is what he's talking about.

And no doubt, the Alberta government has been listening. Prepare for a carbon tax to pay for more projects like this in the future.

A better path forward would be a cap-and-trade system, but that seems about as politically possible in Alberta as a provincial sales tax. We'll have to wait and see on that.

Here's a reason cap-and-trade would work better than the straight taxing of the carbon as it comes out of the tailpipes of consumers' cars.

One of the rock stars of the climate change movement is John Schellnhuber, born Hans Joachim Shellnhuber. He's been named a science and climate change advisor to the pope, and is a Commander in the Order of the British Empire, among many other honours and accomplishments.

Last June the Executive Intelligence Review named him a “Satanist in the service of the British Royal Family” who has “in effect declared himself Pope.” So what's not to like about that?

Shellbnhuber will be a key player in the Paris climate change talks. His message is that you can do all the carbon capture you like, and do all the conservation efforts you can imagine, but none of it holds a smoky candle to switching to renewables.

Solar, wind, tide, whatever — nothing Shell or its partners can do will bring us closer to the greenhouse gas cuts we need, the way renewable energy can.

Renewable power has already proven scalable in many of its forms, and the so-called problem of intermitancy (when the sun don't shine and the wind don't blow) is merely an engineering problem that engineers get closer to solving every day.

Remember how people once said you can't get crude oil out of the tar sands without putting more energy (and money) into the process than you can get out? Well, that was an engineering problem too.

A carbon tax on its own does not promote the growth of renewables, except insofar as it raises the price of all energy, making renewables more profitable.

Cap-and-trade, on the other hand, works at both ends of the production process. Producers get paid for their energy, and they get paid just because they produce energy without burning fuel.

That's why cap-and-trade probably won't fly in Alberta. If you cap our total carbon emissions at something even a bit below current levels, every tonne of growth will be taxed and the money paid to industries whose very existence is to put the fossil fuel industry out of business.

That's also why the big energy players are working so hard to look less like bad guys these days.

But just as big oil and gas needed tax subsidies over the years, so will renewables. The source of that cash needs to be cap-and-trade because it taxes all major producers directly, not the buyers of gasoline and diesel.

A carbon tax needs to be more or less revenue-neutral, offset by tax cuts in other areas (like income taxes), or it won't get off the ground. Cap-and-trade is a cash transfer which need not be revenue-neutral. Nor would it be profit-neutral for the big emitters (oil sands developers and coal-fired power generators — the kingpins of the Alberta fossil fuel economy).

But rock stars like Prof. Shellnhuber are adamant that the only way to reach our emission goals is to get off the carbon economy.

In his words, we need “an induced implosion of the carbon economy over the next 20-30 years. Otherwise we have no chance of avoiding dangerous, perhaps disastrous climate change.”

So, taking some of the process carbon out of making more gasoline is not really making progress.

I wonder what our government will come back with, along with its souvenirs of Paris.