Broad & Bipartisan Backing: Carbon Management Technologies Enjoy Broad Support

November 01, 2024

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by Leo Duke and Diana Leane (Carbon Capture Magazine) ... (P)olitical, business, economic, and environmental leaders agree on the need for these technologies as part of the overall mix of technologies to address climate change.

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45Q Sets the Foundation for Commercial Deployment of Carbon Management Technologies
Today, there are 14 domestic commercial-scale facilities with the capacity to capture and store approximately 20 million metric tons of CO2 per year, representing nearly half of the global deployment of the technology to date. Historically, carbon capture technology has been primarily applied in those industrial sectors that emit a pure stream of CO2, such as ethanol production or natural gas processing. However, enhancements to the 45Q tax credit have turbocharged interest in applying carbon management technologies across emitting sectors.

This August marked the second anniversary of the IRA, a critical milestone for the section 45Q tax credit, the foundational policy for the deployment of carbon management technologies. The 45Q tax credit provides a credit on a per-metric ton basis for carbon that is captured from emitting facilities or directly from the air and then permanently stored or reused to make useful products. Today, thanks to these historic policies in support of carbon management, there are now nearly 220 announced carbon management projects in the US across a range of emitting sectors.

45Q Tax Credit Structure
Below, we detail several recent techno-policy developments for the deployment of these climate-crucial technologies across power, industry, CO2 transport, and promising developments in carbon removal.

Deploying Carbon Capture Technologies at Point Sources

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First, the industrial sector relies on fossil fuels to provide high-temperature heat that cannot be easily substituted with renewable sources. Additionally, many industrial processes directly emit CO2, meaning these emissions are directly produced and emitted by the chemical or physical conversion of raw materials into finished goods and cannot be abated without carbon capture. These so-called process emissions are responsible for approximately one-quarter of the emissions from the industrial sector.

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CO2 pipelines are the backbone of the economywide deployment of carbon management technologies across the United States.

The continued safe operation of CO2 pipelines is paramount as the industry expands. With over 5,000 miles of CO2 pipelines in operation, incidents are rare, and the industry has maintained an excellent safety record, according to a new issue brief from the Great Plains Institute. However, as carbon management projects grow, we must ensure the continued safe operation of these systems. To that end, the federal Pipeline and Hazardous Materials Safety Administration (PHMSA) is working on updated regulations to ensure safety standards as this network expands as additional capture and removal facilities come online. As the nation continues to invest in carbon management technology, ensuring the safety of CO2 pipelines is crucial. The forthcoming PHMSA regulations and federal funding efforts must continue the commitment to building a safe and sustainable carbon transport infrastructure.

In parallel, the BIL provided DOE $2.1 billion through the Carbon Dioxide Transportation Infrastructure Finance and Innovation Act (CIFIA) to offer access to capital for large-capacity, common-carrier carbon dioxide transport projects. To meet net zero emissions by midcentury, we must see a networked system of CO2 pipelines transporting CO2 from emitting sources or the air, to secure geologic storage. READ MORE

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Excerpt from Bloomberg: Jason Erickson is a landman on the ranches and farms of western North Dakota. Traditionally, the title refers to someone who brokers the deals wildcatters need to drill for oil on private land. But Erickson belongs to a new breed in that old line. What he does is different, an inverse. He seals land deals so that atmosphere-warming carbon dioxide—hundreds of millions of tons of it—can be pumped deep underneath.

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This carbon-sequestration project, which Erickson first began peddling to his neighbors more than three years ago, would be the largest of its kind in the US, an $8.9 billion venture by Iowa-based Summit Carbon Solutions LLC. Using carbon capture—until recently a fringe technology, and one that’s still largely shunned in environmentalist circles—Summit aims to pool emissions from 57 ethanol plants across the region and lock them more than a mile into the Earth, capitalizing on a federal tax credit that pays companies to bury CO2.

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At the pipeline’s endpoint, though, on the ranches beneath which Summit hopes to bury its CO2, the plan is broadly accepted.

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Of all the climate solutions at America’s disposal, carbon capture might be the most polarizing. The environmental left, in organizations such as the Sierra Club and Food & Water Watch, has rejected it as a costly, potentially unsafe tool designed to prolong the life of legacy fuels like ethanol, coal and oil. Some on the right, meanwhile, despise carbon capture for a different, entirely incompatible reason: their stubborn conviction that climate change is not, in fact, a problem.

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The state, he (North Dakota governor, Doug Burgum) predicted, could become a mass importer of carbon dioxide, bringing in greater volumes than its coal stacks and oil field flares emitted. Burgum suggested that North Dakota could even go on to become America’s first “carbon negative” state, with the greenhouse gas not only offsetting but reenergizing oil production, thanks to a process known as enhanced oil recovery.

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Industry is also moving ahead. In late 2021, Exxon Mobil Corp. bid on about 100 shallow-water leases in the Gulf of Mexico, a signal of its apparently serious interest in storing carbon beneath the seabed there.

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Big Oil is now so heavily invested in the approach, the Wall Street Journal reported, that it warned former President Donald Trump’s campaign against dismantling the Inflation Reduction Act, particularly sections of the climate law that subsidize carbon capture and carbon removal.

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The Energy Department projects that by 2050 the US will need to capture 400 million to 1,800 million metric tons of CO2 annually, more than 80 times what the country can capture today.

The question, then, is where to put it.

North Dakota is one of few places in the US where these storage projects are moving forward. Not coincidentally, it’s one of only three states cleared by the federal government to handle carbon-burial permitting themselves rather than having to rely on the much slower Environmental Protection Agency.

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Like the speakers before him, (Trent) Loos hammered on the infringements of eminent domain and the hazards of living near a CO2 pipeline. In Loos’ telling, Summit’s pipeline is the product of a secretive globalist land grab, a deep-seated plot whose roots reach all the way to the United Nations. More than anyone before him, though, he spelled out an environmental basis for right-wing opposition to carbon capture, warning his audience against what he called “the big lie”: that an accumulation of human emissions in the atmosphere is warming the planet. “I’m most concerned about the lie that we’re being told about greenhouse gases, which improve planet health every day,” he said, “and we’re being told we gotta tie ’em up.”

I was struck, leaving Fort Dodge, by how uncompromising the crowd had been. There seemed to be a fault line among those aligned with traditional energy sources. Many of the oil and coal proponents I’d met in North Dakota have become full-throated evangelists for carbon capture, even if they don’t readily concede that the CO2 they aim to capture is altering the climate. Almost everyone I met in Fort Dodge was a purist who balked at any concessions to the energy transition.

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More than 90% of the area Summit needs for its carbon injection plans is signed on, well above the 60% threshold North Dakota requires for the project’s storage component to go forward. CO2 doesn’t recognize fence lines, of course, and if the state’s oil and gas industry regulators approve Summit’s injection plans, the company could inject beneath (Kurt) Swenson’s land with or without his permission. But Swenson might still represent a threat to North Dakota’s carbon sink ambitions via a lawsuit he and a group called the Northwest Landowners Association are pursuing against the state’s carbon storage laws. If successful, their case could ensure that the rights to property thousands of feet underground are treated much the same as the rights to the land on the surface—an outcome that would likely leave companies trying to bury CO2 entangled in costly skirmishes over eminent domain. READ MORE

Excerpt from Mongabay:

Direct air capture — geoengineering technology that draws carbon dioxide from the air, allowing it to be stored in geologic formations or used by industry — is being heavily hyped as a climate solution.
But as direct air capture (DAC) pilot projects an startups grow in number around the world, fueled by investment and government funding in the U.S. and elsewhere, this proposed climate solution is becoming ever more divisive.

... But this would-be heavy-industry geoengineering solution remains mired in controversy as it faces real-world questions of cost, scale and viability.

At its most basic, direct air capture works by passing vast quantities of air through a series of filters and membranes to trap atmospheric carbon dioxide. DAC differs from other carbon capture approaches that aim to trap CO2 directly at the source.

Once captured, CO2 can be funneled into the earth, stored in geological formations for hundreds or thousands of years, or used by other industries to produce products ranging from plastics to hydrogen to synthetic aviation fuels.

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Proponents argue that DAC can help achieve these climate goals, especially tackling emissions from hard-to-abate industries, and they underline its potential to remove CO2 at industrial scales, possibly even capturing billions of tons each year.

“The reason why direct air capture is such a unique and important part of the carbon removal portfolio is because it gives extremely high levels of permanence,” says Kajsa Hendrickson, director of policy at Carbon180, an NGO that backs DAC as a climate solution. “We can store that captured CO2 underground for thousands of years.”

But the technology is contentious, with DAC development tied closely to oil and gas interests. And with critics skeptical about DAC’s effectiveness along with the mammoth challenge of finding sufficient sources of renewable power to run energy-guzzling DAC facilities.

“I think [DAC] is intentionally distracting us from actually reducing emissions,” says Jonathan Foley, executive director of Project Drawdown, an NGO. “We’ve maybe at most removed a few seconds of the world’s emissions after spending billions and billions of dollars which would have been better spent elsewhere.”

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Earlier this year, a plant opened in Iceland that, for now, claims to be the world’s largest DAC facility. Operated by Switzerland-based Climeworks, the facility is technically capable of removing around 36,000 metric tons of CO2 from the air annually and storing it underground, but this is more likely to be around 28,000 “net carbon dioxide removal,” according to Kate Dmytrenko, a Climeworks spokesperson. This plant builds on the work done at a smaller pilot facility in Iceland, dubbed Orca, that is removing around 3,000 metric tons of carbon yearly. As a point of reference, human activities released 35.8 billion metric tons of carbon dioxide into the atmosphere in 2023.

“There’s no other path forward other than really ramping down our reliance on fossil fuels and increasing our ability to access renewables,” Dmytrenko says. “But doing all of those things doesn’t address the fact that there’s [already] too much carbon in the atmosphere and all of [those fossil fuel cuts] isn’t going to solve that problem.”

Powered sustainably on Iceland’s abundant geothermal energy, Climeworks has provided proof of concept, showing that DAC can work, says Dmytrenko.

The company is now planning Project Cypress, a far larger U.S. project that aims to capture 1 million metric tons of CO2 annually by 2030. Supported by industry partners and spurred on by millions of dollars in government funding, this project is part of an ambitious federal initiative to establish four DAC Hubs across the United States to drive technology deployment forward. Whether such a costly and ambitious climate goal will be backed financially by the incoming Trump administration is anyone’s guess.

Numerous other startups are moving into the DAC space. Some, such as France’s RepAir, are developing electrochemical approaches to carbon capture that try to sidestep energy-intensity issues, while others aim to produce valuable byproducts from the capture process, such as hydrogen, which can be sold at a profit.

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Despite this momentum, direct air capture remains a nascent and expensive investment. As with other carbon direct removal techniques, DAC development costs are currently high — between $600 and $1,000 per captured metric ton.

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Novel carbon removal solutions such as DAC account for a tiny fraction of an estimated 2 billion metric tons of carbon removal occurring today, according to the report. It’s estimated that the few dozen DAC facilities across the globe trapped a mere 10,000 metric tons of CO2 in 2023. That’s dwarfed by other forms of carbon removal, including tree planting and biochar.

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Direct air capture is considered a climate solution for the aviation industry, removing atmospheric CO2 while potentially creating “net zero” sustainable aviation fuels made using captured carbon. Airlines are among the global companies investing in DAC.

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For now, DAC is largely buoyed up by PR momentum, along with government and investor spending. But beyond the hype looms the very real challenges for achieving scale. For industry players, that means keeping ballooning research and infrastructure development costs under control, and especially requires finding clean energy sources.

Because DAC facilities are energy-intensive, their success hinges upon renewable energy availability. Climeworks, for example, is currently trying to source renewable energy for its Louisiana plant. But that DAC facility may need to run on “traditional energy” (i.e. fossil fuels) at first until renewables becomes available, says company spokesperson Dmytrenko.

This conundrum raises another red flag: To be successful, DAC will need to compete for renewables with other industries. In the U.S. and elsewhere, that competition is coming in part from the buildout of massive energy-consuming data centers, with AI on target to become a huge global renewable energy hog.

The data center dilemma “came out of left field” for direct air capture developers, says Josh Santos, founder of Noya, a U.S.-based DAC startup. Reports find that at least one DAC project has been canceled due to a lack of available clean energy.

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Critics of DAC, such as Project Drawdown’s Jonathan Foley, say that nature-based approaches to carbon removal should be prioritized over DAC technology.

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“The sourcing of renewable energy is probably the biggest project-related hurdle that direct capture has to overcome,” says Santos. “Over time, it’s going to be relatively straightforward to source underground geologic wells. It’s going to be relatively straightforward to acquire permits for installing direct capture projects. The hardest part is going to be sourcing renewable energy.”

But others question the logic of developing clean energy to remove atmospheric carbon rather than just stop using fossil fuels altogether. Benjamin Sovacool, a climate scientist at University of Sussex, U.K., and his team produced expert-based recommendations for DAC use. While not advocating for the tech, the researchers aimed to optimize direct air capture projects. “Is the best pathway just to produce clean, low carbon electricity, full stop? Or is our best pathway to use low carbon electricity to run these [DAC] machines all the time?” Sovacool asks.

And he’s not alone in posing this question. In his view, investing in wind, solar and energy storage are likely “better investments” than direct air capture.

“In the best case, you use renewable energy to run the direct air carbon capture equipment, preventing that renewable energy from replacing a fossil source in the first place,” explains Mark Jacobson, a professor at Stanford University. “The other problem with carbon capture and direct air capture is it always needs pipelines.”

A 2023 report by the Oxford Institute for Energy Studies estimated that construction of carbon capture infrastructure on the “same order of magnitude as the existing refining industry” will be needed to draw down 1 billion metric tons of carbon by 2050.

It’s estimated that the amount of pipeline required for a large-scale carbon capture industry in the U.S. alone would require a colossal 96,000 kilometers (nearly 60,000 miles) of new pipeline. This construction challenge gets even bigger when you add in the infrastructure for the plants. DAC facilities would demand massive amounts of carbon emission-intensive building materials, including steel and concrete.

“These are some of the … material infrastructural constraints that, to me, scream that DAC will likely not be a significant source of emissions reductions in the near term,” says Sovacool.

He also questions what happens when DAC plants reach the end of their working lives. “This is a question we’re now just beginning to answer for wind turbines and solar, but I haven’t seen a single study talk about end-of-life recycling and reuse of DAC materials or DAC waste streams.”

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With an increasing number of DAC projects now in the pipeline, the effectiveness of the technology over the long run remains in doubt, and doubtful too are the industry’s highly ambitious growth projections.

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But achieving proof of concept via pilot projects and startups is a long, long way from scaling up DAC, which brings with it a host of concerns, says CIEL’s Fuhr. “Immediately, questions of energy and resource input into these technologies become extremely relevant,” she says. “What we’ve seen in reality is the fossil fuel industry really betting on this technology as a way to expand their business.”

Some experts argue that DAC projects must be developed with strict regulatory guardrails in place — banning its use for enhanced oil recovery and only operating using clean energy. That approach could help ensure DAC becomes a beneficial part of climate action. “I don’t want to say I’m pro direct air capture as the ultimate solution, because it isn’t,” says Dawid Hanak, professor of Decarbonisation of Industrial Clusters at the Net Zero Industry Innovation Centre at Teesside University, U.K. “I believe that it is part of the portfolio that we will need to deploy.”

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Citations:

Breyer, C., Fasihi, M., Bajamundi, C., & Creutzig, F. (2019). Direct air capture of CO2: A key technology for ambitious climate change mitigation. Joule, 3(9), 2053-2057. doi:10.1016/j.joule.2019.08.010

Ozkan, M., Nayak, S. P., Ruiz, A. D., & Jiang, W. (2022). Current status and pillars of direct air capture technologies. iScience, 25(4), 103990. doi:10.1016/j.isci.2022.103990

Liu, Z., Deng, Z., Davis, S. J., & Ciais, P. (2024). Global carbon emissions in 2023. Nature Reviews Earth & Environment, 5(4), 253-254. doi:10.1038/s43017-024-00532-2

Keith, D. W., Holmes, G., St. Angelo, D., & Heidel, K. (2018). A process for capturing CO2 from the atmosphere. Joule, 2(10), 2179. doi:10.1016/j.joule.2018.05.006

Desport, L., Gurgel, A., Morris, J., Herzog, H., Chen, Y. H., Selosse, S., & Paltsev, S. (2024). Deploying direct air capture at scale: How close to reality? Energy Economics, 129, 107244. doi:10.1016/j.eneco.2023.107244

Abdulla, A., Hanna, R., Schell, K. R., Babacan, O., & Victor, D. G. (2020). Explaining successful and failed investments in U.S. carbon capture and storage using empirical and expert assessments. Environmental Research Letters, 16(1), 014036. doi:10.1088/1748-9326/abd19e

Qiu, Y., Lamers, P., Daioglou, V., McQueen, N., De Boer, H., Harmsen, M., … Suh, S. (2022). Environmental trade-offs of direct air capture technologies in climate change mitigation toward 2100. Nature Communications, 13(1). doi:10.1038/s41467-022-31146-1

Sovacool, B. K., Baum, C. M., Low, S., Roberts, C., & Steinhauser, J. (2022). Climate policy for a net-zero future: Ten recommendations for Direct Air Capture. Environmental Research Letters, 17(7), 074014. doi:10.1088/1748-9326/ac77a4

Jacobson, M. Z. (2019). The health and climate impacts of carbon capture and direct air capture. Energy & Environmental Science, 12(12), 3567-3574. doi:10.1039/c9ee02709b

Chatterjee, S., & Huang, K. (2020). Unrealistic energy and materials requirement for direct air capture in deep mitigation pathways. Nature Communications, 11(1). doi:10.1038/s41467-020-17203-7

Motlaghzadeh, K., Schweizer, V., Craik, N., & Moreno-Cruz, J. (2023). Key uncertainties behind global projections of direct air capture deployment. Applied Energy, 348, 121485. doi:10.1016/j.apenergy.2023.121485

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Treasury Department tax policy tax credits Switzerland Sustainability South Dakota safety Regulations-Federal pipelines Pipeline and Hazardous Materials Safety Admin (PHMSA) North Dakota Jetfuel (Sustainable Aviation Fuel (SAF)) Iowa Investing Iceland government investment environmental policy enhanced oil recovery (EOR) direct air capture Department of Transportation (DOT) Department of Energy (DOE) coal co-products carbon/CO2 sequestration carbon removal carbon recycling carbon pipeline Carbon Dioxide (CO2) carbon capture and utilization (CCU) carbon capture and storage (CCS) BioChemicals/Renewable Chemicals Aviation Fuel/Sustainable Aviation Fuel (SAF) 45Q Carbon Oxide Sequestration Tax Credit

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