There’s More than One Way to Save the Planet! Carbon Capture and Sequestration (CCS) Another New Market for Bioenergy

March 18, 2020

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by Mike Newman (Parhelion Underwriting/Biofuels Digest) Carbon capture and sequestration (CCS) is an important strategy to reduce greenhouse gas (GHG) emissions and mitigate climate change. CCS is a process by which large amounts of carbon dioxide (CO₂) are captured, compressed, transported, and sequestered. The sequestration component of CCS includes CO₂ injection into geologic formations (such as depleted oil and gas reservoirs, un-mineable coal beds, and saline formations) as well as use in industrial materials (e.g. concrete). CCS is distinct from biological sequestration, which is typically accomplished through natural and working lands management and conservation practices that enhance the storage of carbon or reduce CO₂ emissions.

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The problem from a negative-emissions point of view is that the CO₂ rapidly gets back into the atmosphere. But there is one notable exception. For half a century oil companies have been squirting CO₂ down some of their wells in order to chase recalcitrant oil out of the nooks and crannies in the rock—a process known as enhanced oil recovery, or EOR. And though the oil comes out, a lot of the CO₂ stays underground.

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A startup called net Power has built a new sort of gas-fired power plant on the outskirts of Houston. Most such plants burn natural gas in air to heat water to make steam to drive a turbine. The net Power plant burns natural gas in pure oxygen to create a stream of hot CO₂ which drives the turbine directly—and which, being pure, needs no further filtering in order to be used for EOR. And oil recovered through EOR that uses atmospheric CO₂ can earn handsome credits under California’s Low-Carbon Fuel Standards cap and trade program.

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California’s Air Resources Board (CARB) has adopted a CCS protocol under the Low Carbon Fuel Standard (LCFS), describing the requirements that CCS projects must meet in order to generate LCFS credits.

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The following table is intended to be a complete list of the types of CCS projects that are eligible for crediting under the LCFS regulation; CARB staff acknowledges that there may be other CCS project types that could become eligible for LCFS crediting in the future.

5. What types of sequestration sites are eligible for CCS projects?

The sites that are eligible for CO₂ sequestration under the LCFS are:

Saline reservoirs
Depleted oil and gas reservoirs
Oil and gas reservoirs used for CO₂-enhanced oil recovery (CO₂-EOR)

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In 2008 the U.S. enacted a tax credit, 45q, that was to reward the first 75m tonnes of CO₂ sequestered through CCS. Last year 45q was amended. Instead of a 75m tonne cap, there is now a time limit: all projects that are up and running before January 1st 2024 will be eligible. READ MORE

Stripe’s first negative emissions purchases (Stripe)

Going Deep on Carbon Capture, Utilization, and Storage (CCUS), with Julio Friedmann (Resources Magazine)

Carbon Capture Leaders Roundtable: Global Perspectives on the Role of CCUS in Building a Clean Energy Future (Dynamo Energy Hub)

Investing in Climate Innovation: The Environmental Case for Direct Air Capture of Carbon Dioxide (Bipartisan Policy Center)

Occidental-backed company will build new U.S. CO2 removal plant (Reuters)