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By rdnewsNOW staff

Agriculture

Province says tax credit fuels investments in bioprocessing industry

Apr 23, 2024 | 1:08 PM

The Alberta government says the province will be home to the largest renewable diesel facility in Canada as Imperial qualifies for the Agri-Processing Investment Tax Credit program.

Government officials say Alberta is an agricultural powerhouse with diverse and innovative industries, including a thriving bioprocessing sector. When companies set up operations here, the province says they experience a welcoming, business-friendly regulatory environment and one of North America’s most competitive business tax systems.

Alberta’s government says it introduced the Agri-Processing Investment Tax Credit in spring 2023 to support economic growth and diversification.

Officials say the tax credit is attracting large-scale investment in value-added manufacturing with Imperial’s $720-million project to build the largest renewable diesel facility in Canada. When production begins in 2025, the government says Imperial’s new facility will convert locally sourced bio feedstocks like canola oil into lower-emission renewable diesel, creating new demand for Alberta producers.

“Our government is doing what it takes to make sure Alberta offers a business-friendly regulatory climate that attracts cutting edge bioprocessing projects like Imperial’s renewable diesel facility,” says RJ Sigurdson, Minister of Agriculture and Irrigation.

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“Our Agri-Processing Investment Tax Credit program builds on other competitive tax advantages that encourage corporations like Imperial to invest in our province, create jobs and make an economic impact.”

The government says Imperial’s renewable diesel facility is the first of its kind in Alberta and will put the province on the map as a significant producer within Canada.

Officials say it also contributes to Alberta’s goal of lowering emissions as renewable diesel has potential to reduce annual greenhouse gas emissions by about three million metric tonnes compared with conventional fuels. The province says the new facility at the Strathcona refinery is expected to produce more than one billion litres of renewable diesel per year, or 20,000 barrels per day.

To be considered for the tax credit program, the government says corporations must invest at least $10 million in a project to build or expand a value-added agri-processing facility in Alberta.

Officials say the program offers a 12 per cent non-refundable tax credit base on eligible capital expenditures. Through this program, Alberta’s government says it has granted Imperial conditional approval for a tax credit estimated at about $70 million.

“This incredible project demonstrates that our province is becoming a world leader in alternative fuels and energy innovation,” says Brian Jean, Minister of Energy and Minerals.

“Renewable diesel has great potential and is a welcome addition to our energy mix, which includes hydrogen and renewables.”

“Imperial’s renewable diesel facility will provide an important new lower-emission offering to Canada’s transportation sector. We are excited that the main source of feedstock for the facility will be from crops in Western Canada and thank the Government of Alberta for their recognition of the project’s benefits to the agricultural industry and our collective greenhouse gas emissions reduction goals,” adds Sheri Evers, senior vice president sustainability, commercial development and product solutions, Imperial.

The government says construction on the new facility is already underway at Imperial’s Strathcona refinery.

The project is said to be creating about 600 local construction jobs for Albertans and hundreds more through investments by business partners.

Once the facility is completed, officials say hundreds of farmers and workers in Alberta’s bio feedstock industry will enable the company to produce a fuel that helps reduce greenhouse gas emissions in the Canadian transportation sector.

“We are excited to see this investment being made in Alberta’s canola country,” says Chris Vervaet, executive director, Canadian Oilseed Processors Association.

“Local production of renewable fuels derived from locally grown canola provides an important market diversification opportunity right here in our own backyard that will benefit farmers, processors and the entire value chain in the province of Alberta.”