Canada Growth Fund Inc., Gibson Energy Inc., and Varme Energy Inc. have entered into a strategic partnership to accelerate the development of Canada’s first waste-to-energy facility with carbon capture technology. If successful, the project will be located on Gibson land in Alberta’s Heartland-area and will have the capability to process 200,000 tonnes per annum of municipal solid waste, diverting residential garbage from landfill. Such waste will be received pursuant to a 15-year contract that has been entered into by Varme and the City of Edmonton.
This proposed greenfield waste-to-energy facility, which would be constructed by the Partnership and operated by Gibson, would have integrated carbon capture equipment enabling the Project to incinerate municipal solid waste and produce carbon-negative electricity. A front-end engineering and design (FEED) study is underway, and a final investment decision (FID) by the partnership is planned in early 2025, with commissioning targeted in 2027.
The project supports the advancement of technologies fundamental to achieving a net-zero electricity grid across the country. Integrated waste-to-energy and Carbon Capture and Storage (CCS) has significant potential to be replicated in municipalities across Canada and to put Canada in a position to export this expertise globally. By accelerating local waste diversion, the project will increase the supply of carbon negative electricity in Alberta by avoiding harmful methane emissions.
Governments globally, including the Government of Canada and the Government of Alberta, have identified rapid reductions in methane emissions as key to limiting near-term climate impacts.
Pursuant to the terms of the partnership, should the project reach a positive FID, Gibson, CGF and Varme would have a 50 per cent, 40 per cent and 10 per cent ownership interest, respectively. In addition, CGF would provide a carbon price assurance mechanism in the form of a Carbon Credit Offtake (CCO) to purchase up to 200,000 tonnes per annum of compliance grade carbon credits generated by the project at an initial price of $85 per tonne for a term of 15 years.
Canada Growth Fund is a $15 billion arm’s length public investment vehicle that helps attract private capital to build Canada’s clean economy by using investment instruments that absorb certain risks in order to encourage private investment in low carbon projects, technologies, businesses, and supply chains.
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