Capturing What’s Out There

October 24, 2024

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by Luke Geiver (Ethanol Producer Magazine) Carbon management is experiencing exponential growth, according to the leading U.S. government agency responsible for overseeing and developing infrastructure for it. While the U.S. Department of Energy has many offices working on carbon sequestration, the Office of Fossil Energy and Carbon Management, or FECM, has invested roughly $1.47 billion over the past four years into a range of projects, spanning carbon capture, use, transport, storage and removal.

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FECM currently has available funding to help industrial, power generation and legacy carbon dioxide producers study the possibilities of CO2 transport to locations for geologic storage or conversion to useful products—and ethanol plants qualify. The CO2 can be transported by several means, including pipeline, rail, truck, barge or ship.

FECM’s overall goal isn’t just about capturing and transporting CO2. The DOE wing consistently points out that performing such a substantial scale-up of infrastructure in the next decade will not only support the growth of the carbon management industry, but also create high-paying jobs and protect communities across the country.

Funding Opportunities for CO2 Produced Via Ethanol Production
Last year, FECM made a funding opportunity announcement (FOA 2730) of $27 million to support front-end engineering and design (FEED) studies for regional CO2 transport networks. It was the second round of funding for such projects. That $27 million outlay was part of a larger opportunity with $100 million allocated from the Bipartisan Infrastructure Law to help kickstart CO2 transport projects. While some of that funding has been awarded, FECM has reopened its funding opportunities again for another round. In May, another $24 million funding round was announced.

“To date, the current number of projects selected and associated funding under the FOA 2730 falls below that threshold ($100 million), which means there is more funding that can be deployed to support future FEED studies,” a FECM spokesperson says.

Seven total selections have been previously identified through FECM selection announcements, representing a range of potential industries including power generation, gas processing, refining and chemical production, FECM says, and funding will continue through 2026.

During the first round of funding, three recipients were chosen. Each funding recipient received the full $3 million available from FECM. In Michigan, Carbon Solutions LLC was awarded for the purpose of studying a commercial-scale pipeline to transport quantities of anthropogenic CO2 through a multi-point pipeline delivering the compressed gas to multiple geologic storage locations.

In Texas, Howard Midstream Energy Partners LLC was awarded funding to help study a 600-mile regional and commercial scale pipeline for moving supercritical anthropogenic CO2 from various sources to multiple CO2 sinks on the Gulf Coast.

In Georgia, Southern States Energy Board will study a pipeline system across the Houston-Galveston region to decrease the region’s CO2 emissions using a 60-mile pipeline.

For the second round of FEED study funding through FOA 2730, FECM awarded four recipients.

BKV dCarbon High West LLC out of Denver, was awarded roughly $2.5 million to look at a CO2 barge operation for the Gulf Coast of Louisiana, Mississippi and Alabama.

Carbon Solutions LLC (also a recipient through the first round of funding) was awarded $3 million to study an open-access, 488-mile CO2 pipeline to transport up to 32 million metric tons of CO2 per year across Montana, North Dakota and Wyoming.

In Florida, Overseas Shipholding Group Inc. got $2.5 million to study a CO2 transport system based on an articulated tug and barge operation from a proposed multimodal hub at Port Tampa Bay to an existing tank terminal near Sunshine, Louisianna.

And the last recipient of the second round of funding was ZuCO2 Transport LLC out of California. The company will study a West Coast barge CO2 project that would take CO2 from Washington, Oregon and California to a storage site in the San Joaquin Delta of California.

While the FECM spokesperson, citing procurement sensitivities, declined to say what, if any, insights new applicants might gain from previous awardees, the office did offer this: “Following the selections announcements, it is apparent that there is market interest in pipeline and waterborne shipping for CO2 transport,” they stated, adding that each mode of transport has a unique opportunity and potential advantage in certain circumstances to support the future large-scale deployment of CO2 transportation infrastructure.

The funding can be used for studying a variety of factors, including scale, terrain, region, size, volume, power supply, CO2 capture, conversion and storage parameters. Studies should be in the range of $750,000 to $3 million and must show technical merit, commercial and regulatory viability, and strategic value to the CCUS and CDR industries, FECM says. While applicants are encouraged to propose projects with the consideration for the creation and integration into a hub-and-cluster configuration, an applicant can offer a different approach.

“The funding opportunity has now matured to be inclusive of all modes of transport and supporting interconnections, and we would like to encourage applicants to take advantage of that inclusivity,” the spokesperson says.

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Although leading ethanol producers see the potential and need for CO2 pipeline infrastructure, there are mixed views amongst landowners, the report said. “National advocacy organizations that oppose both ethanol as an alternative fuel and the carbon capture and storage industry have aligned themselves with local landowners who are strongly opposed to the use of eminent domain to secure the land rights needed for pipeline construction,” the report noted. Because of that, developers need to consider alternative methods to eminent domain while continuing to negotiate purchases or leases.

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Just look at CO2 pipelines. The DOE says there are roughly 5,000 miles of CO2 pipelines across the U.S. with projections of significant scale up of transport capacity demand. In the long-term (i.e., by 2050), DOE believes more than 13,000 miles of CO2 transport trunk lines and over 52,000 miles of spur pipelines will be required to service and store 1 billion metric tons of CO2 per year. And, in the near-term, “development of that infrastructure must begin within this decade.

In addition to funding studies, FECM and its parent entity, the DOE, have invested an average of $400 million a year since 2021. For the development of technologies used to capture CO2 directly from a source or from the air, funding of $54.4 million has been made available.

For help with carbon storage, the DOE has provided $574 million to 49 projects as part of its Carbon Storage Assurance Facility Enterprise (CarbonSAFE) initiative.

And through its Carbon Dioxide Transportation Infrastructure Finance and Innovation (CIFIA) program, FECM has made $500 million available to projects that will expand CO2 transportation infrastructure to help reduce CO2 emissions.

FECM isn’t just funding studies that will help bring infrastructure into existence. The office is also helping to build the demand side for CO2 as well. In mid-2023, FECM announced $100 million in funding to support states, local governments and public utilities, “in purchasing products derived from converted carbon emissions.” READ MORE

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