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As part of the sustainability initiative, and in an attempt to meet their target of net zero carbon emissions, oil and gas firms in Canada, is investing in Carbon Capture Storage Systems (CCS) as part of their strategy to reduce greenhouse gas emissions. This research chapter investigates the impact of CCS investments on a firm’s value, its profitability and its environmental performance, using panel data regression methodology for the years 2010–2022. Environmental score is negatively affecting firm value under the metrics Tobin’s Q and EVA, but a positive impact on the accounting measures of ROA and ROE. A reduction of Scope 1 emissions is having a positive impact on firm value and accounting profit. The study also identifies a curvilinear relationship between environmental performance and firm value, suggesting that the initial costs outweigh the benefits before yielding positive outcomes. These findings highlight the need for cost-efficient CCS innovations and stricter governance to ensure genuine environmental progress rather than so-called ‘greenwashing’. Further research is recommended to explore CCS scalability and its integration with other sustainable practices.

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Carbon Capture Systems’ Impact on Firms’ Environmental and Economic Performance: An Empirical Study of Canadian Energy Firms

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  • 发表日期：

    2026年

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  • Sekhar Amba

摘要

As part of the sustainability initiative, and in an attempt to meet their target of net zero carbon emissions, oil and gas firms in Canada, is investing in Carbon Capture Storage Systems (CCS) as part of their strategy to reduce greenhouse gas emissions. This research chapter investigates the impact of CCS investments on a firm’s value, its profitability and its environmental performance, using panel data regression methodology for the years 2010–2022. Environmental score is negatively affecting firm value under the metrics Tobin’s Q and EVA, but a positive impact on the accounting measures of ROA and ROE. A reduction of Scope 1 emissions is having a positive impact on firm value and accounting profit. The study also identifies a curvilinear relationship between environmental performance and firm value, suggesting that the initial costs outweigh the benefits before yielding positive outcomes. These findings highlight the need for cost-efficient CCS innovations and stricter governance to ensure genuine environmental progress rather than so-called ‘greenwashing’. Further research is recommended to explore CCS scalability and its integration with other sustainable practices.