An Emerging Bonanza in Ethanol-Focused Carbon Capture?

June 19, 2023

Print This Article Share it With Friends

by Jim Kendrick (Biofuels Digest) The US carbon capture market has grown, experts say, to $13 billion in 2023 and according to ExxonMobil is on the way to $4 trillion. That could mean that a bonanza for infrastructure in the form of carbon dioxide pipelines is on the way in ethanol country.

Is “gold rush” putting it too forcefully? Perhaops not. Already in Nebraska and Iowa alone there are four different CO₂ pipeline projects in varying stages of development. Planned underground storage sites for just these pipelines are located in three different US states. One of them comes with a $5B price tag.

Projects in the offing, and the markets to serve

At the International Fuel Ethanol Workshop & Expo’s Carbon Capture & Storage (CCS) Summit in Omaha, Nebraska capturing, transporting, and storing CO₂to improve the lifecycle emissions profile of ethanol was among the top discussion topics at the three day conference, held June 12-14. Fermentation in ethanol plants produces a concentrated stream of process CO₂. Erin Billeri, Senior Client Engagement Lead at the Global Carbon Capture and Storage Institute said, “CCS is a mature suite of emission abatement technologies that has been used for over 50 years. However until recently the policy framework and economic drivers did not exist for large scale deployment.” This policy framework goes beyond government tax incentives in the Inflation Reduction Act (IRA), and the basket of carbon capture tax credits under the Act known as 45Q.

Todd Bush, Managing Director at Decarbonfuse, a low carbon advisory and information company referenced Exxon Mobil’s estimate of a $4 trillion carbon capture market by 2050.

...

Two recently announced deals from pipeline developers, Navigator’s CO₂’s memorandum of understanding with Infinium for utilization of CO₂, and Summit Carbon Solutions’ agreement to sell Carbon Dioxide Removal credits to NextGen “become bankable cash flows,” said Ben Nelson, Director of Carbon Programs for Summit, “and those are accretive to your ability to finance the project and pull those cash flows forward from debt financing.

Why ethanol, why now?

Ethanol plants, cement, and ammonia production are among the top point source CO₂ emitters, making these facilities attractive suppliers of captured CO₂. Billeri said,

...

Bush explained that 70% of US storage is along the Gulf Coast with almost 1,800 gigatons of storage capacity. Bush said, “In the Midwest you have a couple different options; 150 gigatons of storage to the east, kind of in the Illinois basin, and as you go north to North Dakota or might be referred to as Bakken or the Williston basin, almost 150 gigatons of storage there as well.”

...

The opportunity to slash carbon intensity

For corn ethanol to play in future markets such as a biointermediate for sustainable aviation fuel, or receive IRA production tax credits, its lifecycle carbon intensity (CI) needs to be slashed.

...

The infrastructure needed for transporting this captured biogenic CO₂ to store or use, the complex permit requirements involved, tax credits and financing considerations, and the sheer size of the market were key focus areas at the Summit. Although review of a class VI CO₂ injection permit application can take three years from submission to permit issuance, in the interim, expect pipeline developers to forge ahead in obtaining pipeline construction permits to transport captured point source carbon dioxide, as well as continue to source CO₂ supply from emitters. READ MORE

Tags

carbon capture and storage (CCS) carbon capture and utilization (CCU) carbon/CO2 sequestration tax credits environmental policy markets/sales market forces BioRefineries/Renewable Fuel Production co-products Investing Sustainability Big Oil/Oil Majors Nebraska Iowa North Dakota carbon pipeline pipelines life cycle analysis (LCA) Carbon Intensity (CI)/Carbon Footprint ethanol/bioethanol fermentation 45Q Carbon Oxide Sequestration Tax Credit Financing cement ammonia Illinois offtake agreements corn ethanol precursors/biointermediates Aviation Fuel/Sustainable Aviation Fuel (SAF) Jetfuel (Sustainable Aviation Fuel (SAF)) BioChemicals/Renewable Chemicals

Comments are closed.