Coal, Ethanol Industries Seek Sales Tax Exemption for Carbon Storage Projects

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January 21, 2021

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by Amy R. Sisk (Bismark Tribune) Several North Dakota coal and ethanol plants are inching closer to capturing the carbon dioxide they generate and storing it underground, and they’re asking lawmakers to exempt the practice from sales tax.

A similar exemption is already in place if the carbon dioxide is injected into old oil fields to boost oil production, a process known as “enhanced oil recovery.” But the projects in the works in North Dakota seek to store the gas permanently underground far from the oil patch. The greenhouse gas would form plumes in rock formations deep below the earth’s surface and stay buried there, rather than be released into the air where it would contribute to global warming.

Basin Electric operates a carbon capture system at its Great Plains Synfuels Plant near Beulah. Much of the carbon dioxide is piped to Saskatchewan, where it’s used for enhanced oil recovery. The gas also is used by the beverage and food processing industry, as well as at water treatment plants.

Carbon capture is a hot topic in North Dakota as the ethanol industry eyes markets in places such as California that value cleaner fuels. The coal industry sees it as a way to address its carbon emissions in a nation where the public, politicians and policymakers are increasingly demanding action on climate change.

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The Clean Sustainable Energy Authority would be tasked with recommending grants and loans for energy projects to the full Industrial Commission, a three-member panel chaired by Gov. Doug Burgum. The office also would propose an environmental, social and governance policy to the Legislature. Such standards guide socially conscious business decisions, and they are becoming increasingly common in the investment world.

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