29 April 2024

The Alberta Carbon Capture Incentive Program



The Government of Alberta has taken another step towards a sustainable future with the introduction of the Alberta Carbon Capture Incentive Program (ACCIP).
Canada Energy and Natural Resources
To print this article, all you need is to be registered or login on

The Government of Alberta has taken another step towards a sustainable future with the introduction of the Alberta Carbon Capture Incentive Program (ACCIP). Through this program, Alberta seeks to demonstrate its commitment to reducing emissions by supporting and accelerating the development of new carbon capture, utilization and storage (CCUS) infrastructure for at least the next decade. Through the ACCIP, the province plans to commit an estimated CA$3.2 to CA$5.3 billion of support between 2024 and 2035, which is poised to drive CA$35 billion in new investments and create up to 21,000 jobs.

Project grants

The ACCIP will assist the development of new CCUS infrastructure by providing a grant of 12% on capital costs for new eligible CCUS projects. The grant will be paid in three installments over three years starting after one year of operation. Applicants must meet reporting requirements by providing project reports between the grant instalment payments.

A portion of ACCIP funding will come from Alberta's existing Technology Innovation and Emissions Reduction (TIER) fund, which is funded by industry.

Project eligibility

Under the current ACCIP guidelines, CCUS projects will be considered eligible for grants retroactive to January 1, 2022. Projects are eligible for ACCIP funding if:

  • The project is physically located in Alberta; and
  • The project deals with the capture, preparation, compression, transportation, storage, or utilization of carbon dioxide (CO2).

Capital costs eligible for the grant includes:

  • Costs to convert existing equipment to monitor and track CO2 for CCUS;
  • Purchase and installation of approved equipment for an eligible CCUS project, provided an eligible storage or use of the CO2 exists (any utilization which permanently sequesters CO2 will be eligible); and
  • Dual-use equipment (still under consideration by the Government of Alberta).

If the project has already received funding from the Alberta Petrochemicals Incentive Program, or any other Alberta royalty regime, it may not receive any benefits under the ACCIP for the same costs.

Next steps

Pre-approval is available now to industry applicants to determine whether their project may be eligible for ACCIP, and to receive an estimate of potential funding. Final approval applications will open later in 2024, after stakeholder information sessions are complete and ACCIP guidelines are finalized. The ACCIP will align with the federal government's CCUS investment tax credit (CCUS ITC), and will be finalized after the CCUS ITC is enacted.

Alberta has a strong track record of supporting CCUS, having already invested over CA$1.8 billion in projects like the Alberta Carbon Trunk Line and the Quest project, which combined have captured and stored over 12 million tonnes of CO2. Industries such as the Alberta oil sands, petrochemicals, power generation, manufacturing, and cement will greatly benefit from the ACCIP, as CCUS will enable them to make significant emissions reductions. By incentivizing investment and development of CCUS, this program marks a significant milestone in Alberta's journey along its Emissions Reduction and Energy Development Plan to achieve a carbon neutral economy by 2050.

Additionally, in the recent Budget 2024: Fairness for Every Generation (see Dentons' Insight for more details), the Federal Government announced that Bill C-59, which contains the CCUS ITC, is anticipated to come into force on June 1, 2024. To learn more about the CCUS ITC, please refer to previous Dentons article.

About Dentons

Dentons is the world's first polycentric global law firm. A top 20 firm on the Acritas 2015 Global Elite Brand Index, the Firm is committed to challenging the status quo in delivering consistent and uncompromising quality and value in new and inventive ways. Driven to provide clients a competitive edge, and connected to the communities where its clients want to do business, Dentons knows that understanding local cultures is crucial to successfully completing a deal, resolving a dispute or solving a business challenge. Now the world's largest law firm, Dentons' global team builds agile, tailored solutions to meet the local, national and global needs of private and public clients of any size in more than 125 locations serving 50-plus countries.

The authors would like to thank articling students George Hua and Jack Yuan, for their assistance in preparing this insight.

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. Specific Questions relating to this article should be addressed directly to the author.

See More Popular Content From

Mondaq uses cookies on this website. By using our website you agree to our use of cookies as set out in our Privacy Policy.

Learn More