An examination of Canada's Carbon Dioxide production suggests Canada is one of the worst carbon polluters in the world, at 18.9 tonnes per capita.
The USA still stands above us at 20.3 tonnes per, but the numbers are surprising because 70 % of Canadian electricity is from hydroelectric and nuclear -- non-CO2 emitting sources. In comparison only about 25 % of US electricity doesn't come from carbon fuels. So where's the extra CO2 coming from?
It's not the transportation sector. The source is, in fact, industry. Canada's industry is one of the most energy intensive in the entire world. This is largely due to the fact that Canada has a heavy resource-based economy. Canadians consume about 23% more energy per person than even our energy hog friends to the South.
Pulp and paper, smelting, steel, cement, fertilizer, and bitumen (tar sand) production compose the bulk of energy consumption by Canada's industry. However, not all industries produce equal CO2 emissions for a given energy input. Alcan's Aluminium consumes large amounts of electricity for electrolysis -- it cannot use heat directly from a carbon fuel, it can only use low entropy electricity. Steel, on the other hand, is dependant on high quality coke for reduction reactions to remove impurities. Most of the other industrial processes require either heat or steam.
The Alberta tar sands are a special case. Large amounts of hot steam are needed to separate out the valuable volatiles from the sticky mess. So how are we getting oil from the tar sands? We burn natural gas of course. This makes tar sand gasoline extremely intensive in C02 terms. One possible solution is to build a nuclear steam plant up in Fort McMurray. However, using nuclear to provide heat and steam only really works in that one place, because all the refineries are pretty much lined up in a row. Saskatchewan's potash plants, in comparison, are not close together.
This leaves us at the possibility of recovering CO2 emissions at the source and pumping it underground. Recovery can be done by either physical means (liquefaction of C02 from the exhaust) or chemical means. A technical discussion of CO2 recovery can be found here:
Pumping CO2 underground is a relatively well established technology for oil wells. The Saskatchewan Weyburn field project is representative of the concept. As a side benefit, liquefied C02 is actually a superior agent for forcing the remnants of oil from a nearly exhausted field than water. Hence, there might actually be some real economic value in liquefied CO2.
There has been a recent surge in interest in CO2 sequestration by some of the Kyoto opponents in the world. This is of course, somewhat amusing because Kyoto is a purely carbon metric, and it is difficult to not be somewhat cynical of their motives. The real value of Kyoto is that is creates a carbon pollution trading system. Unfortunately, the voluntary system proposed by the USA is likely to be far less successful than the capitalist Kyoto system.
If we can't put a dollar value on liquefied Carbon Dioxide, industry will continue to deal with it the way they know how: with an exhaust.