Alberta’s Climate Change and Emissions Management Corporation partners with industry to clean up province’s act

Environmental technology will change the reputation of this province, courtesy of carbon penalties

By Gordon Jaremko

December 01, 2009

CCEMC’s ability to launch its environmental investment portfolio in the midst of a global recession grows out of a protected financial structure. The apparatus, created by provincial legislation but built to work at arm’s length from the government and run by business veterans, is founded on consensus among Alberta political and industry leaders. The province’s commanding officer class is convinced that clean energy efforts must continue on a scale planned during the bygone flush times through economic lean spells. While provincial health and education services face cuts, Newell’s budget is secure. “We have sustained funding and it’s outside of government. They can’t steal it and use it somewhere else to solve a problem,” he says.

The funding is about $80 million per year, collected by Alberta’s one-of-a-kind penalty levy of $15 per tonne for carbon emissions exceeding ceilings set on large industrial operations. Collections began early in 2008. By mid-2009, CCEMC had $122 million, which was deemed to be enough to start serious work even by the energy sector’s customary standards of thinking big.

A mid-summer invitation for ideas rapidly attracted 59 bids for support of up to $25 million apiece. The number kept on rising as a fall deadline approached. CCEMC’s directors, appointed from the energy sector’s upper echelons and assisted by hired-gun consultants recruited from senior professional ranks, went to work on selecting ideas with good chances of maturing into useful economic projects.

To preserve prospects of developing the 175 billion barrels of oil sands reserves, CCEMC has a sweeping mandate to earn Alberta a reputation as a clean energy factory on all fronts. Half of the initial $120-million investment goes into a wide field, called “greening energy production,” of switching industrial operations over to cleaner-burning fuels or renewable and alternative sources. Another 20 per cent of the portfolio is dedicated to conservation and efficiency, while 30 per cent is earmarked for refinements of carbon capture and storage, potentially including technology for projects already participating in the province’s $2-billion CCS development program.

CCEMC will cover up to half the costs of advancing ideas that already moved beyond the brainstorm stage to any point along the technology “innovation chain” of applied research and development, technical design, pilot or prototype demonstrations, putting on commercial finishing touches, marketing and diffusion. Sponsors must show commitment, under a requirement to cover a minimum one-third of costs with their own money if their projects qualify for aid from government programs.

Promotional flights of green fancy need not apply. “We need to have credibility. This is legitimate,” Newell says. “You’re going to get judged by your actions. You’ve got to walk the talk.”

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