The partnership with Canada Growth Fund represents one of the largest Carbon Credit Offtake purchase agreements in Canadian history
June 11, 2024 12:47 PM Eastern Daylight Time
EDMONTON, Alberta–(BUSINESS WIRE)–Today, Varme Energy announced they will be entering into a partnership with Gibson Energy and Canada Growth Fund to advance their planned waste-to-energy project in the Edmonton region. With this partnership, the planned facility will be located on land that is owned by Gibson Energy in Strathcona County within Alberta’s Industrial Heartland. The project will also benefit from financial backing from the Canada Growth Fund.
The agreement with Canada Growth Fund is a first for the Edmonton region and provides a carbon price assurance in the form of a Carbon Credit Offtake to purchase 200,000 tonnes per year at an initial price of $85 per tonne for a term of 15 years. This is one of the largest such agreements in Canadian history, and the first contract for differences announced in the Edmonton region. The agreement will also allow Varme Energy to resell up to half of carbon credits generated to other corporations and brands looking to meet their own sustainability targets. This is a first for this type of agreement in Canada and demonstrates a clear path forward that will help to de-risk private investment into carbon capture projects, accelerate the adoption of this technology, and attract international investment.
Varme Energy, a subsidiary of Norwegian company Green Transition Holdings, announced its expansion into the Edmonton region in 2022. Last year, the company entered into a 15-year agreement with the City of Edmonton to provide 150,000 tonnes of municipal waste as feedstock for its planned waste-to-energy facility.
This agreement with the Canada Growth Fund and Gibson Energy represents one of the last steps to move this project toward Final Investment Decision (FID) and sends a positive signal needed for the success of this project.
The project is slated to reach Final Investment Decision within a year and be operational in late 2027. The construction phase is expected to create more than 250 job over a 2.5-year period and 30 full-time, on-going, operational jobs.
Read the Varme – Gibson joint release here.
Quotes:
“The Edmonton region is home to the best CCS story on earth. The scale and sophistication of Alberta’s Industrial Heartland, access to Tier 1 operators like Gibson Energy, and proximity to the world’s largest built CO2 projects make the Edmonton region ground zero for the Canadian energy transition. We’re forever grateful to the partners who have helped us move this project forward. Special thanks to Canada Growth Fund, Gibson Energy, Alberta’s Industrial Heartland Association, Strathcona County, the City of Edmonton, Edmonton Global, and Invest Alberta. Their support, along with the support from dozens of other stakeholders have been instrumental in unlocking these critical investments to advance our project and our region.” – Sean Collins, CEO, Varme Energy
“Strathcona County is thrilled to welcome Varme Energy’s innovative waste-to-energy project to our community. This significant announcement underscores our commitment to fostering new investments that drive economic diversification, as well as environmental sustainability. By welcoming industry leaders like Varme Energy, we are not only creating new jobs but also advancing our vision for a sustainable future. This project exemplifies Strathcona County’s role as a prime location for groundbreaking initiatives that benefit both our economy, workers and the environment.” – Mayor Rod Frank, Strathcona County
“This is a significant development for Alberta’s Industrial Heartland (AIH) as this Carbon Credit Offtake Agreement between the Canada Growth Fund and Varme Energy is a watershed moment for decarbonization efforts in AIH. Varme’s waste-to-energy project is a testament to AIH’s strong value proposition and an illustration of the decarbonization potential our region offers. Congratulations to Varme Energy and Gibson Energy on achieving this major milestone.” – Mark Plamondon, Executive Director, Alberta’s Industrial Heartland Association
“Varme Energy’s parent company is Norwegian-based Green Transition Holdings. Their decision to create Varme Energy and headquarter it in the Edmonton region, was a major signal of confidence in our region and Alberta’s economy. This project is among the first in the world to build a net-zero waste-to-energy project as a greenfield investment. The Canada Growth Fund is helping de-risk private sector investments like this into the energy transition. This is critical in making Canada more globally competitive for attracting investment. There have been a lot of partners working behind the scenes to support this critically important project, both in Canada and in Norway. Congratulations to Varme Energy on securing this carbon contract and achieving a major milestone for this important project. Canada’s path to net-zero runs through the Edmonton region.” – Malcolm Bruce, CEO, Edmonton Global
About Alberta’s Industrial Heartland Association
Alberta’s Industrial Heartland Association (AIHA) is a non-profit organization that drives capital investment into Alberta’s Industrial Heartland (AIH). AIH is Canada’s largest hydrocarbon processing region and one of the world’s most attractive locations for chemical, petrochemical, oil, and gas investment. Learn more at industrialheartland.com.
About Edmonton Global:
The purpose of Edmonton Global is to radically transform and grow the economy of the Edmonton Metropolitan Region. We are a not-for-profit corporation founded by 14 municipalities that make up the Edmonton Metropolitan Region. Our focus is attracting foreign investment, helping regional businesses export with the world, enhancing our region’s global competitiveness, and bringing our region together with a unified voice to attract the attention and interest of investors the world over. Learn more at edmontonglobal.ca.
Contacts
Contact Edmonton Global
Sherri Bouslama
Sr. Manager, Brand Strategy & Communications
[email protected]
780-996-1524
Contact Alberta’s Industrial Heartland
Karlee Conway
Director of Communications
[email protected]
780-232-0105