White House Report Recommends Accelerating Carbon Capture, Utilization and Storage
Tue, July 06, 2021
When it comes to the next wave of technology to reduce greenhouse gas emissions, Texas is poised to take a leadership role.
It’s called Carbon Capture, Utilization, and Storage—otherwise known as CCUS —and it’s a technology that is already reducing carbon emissions and will be a key component to achieving the country’s emissions reduction goals. Essentially, CCUS is the process of removing carbon dioxide (CO2), either from the emissions source (i.e. smokestack of a power plant) or even directly from the atmosphere.
In a report to Congress last month, the White House Council on Environmental Quality identified some best practices for efficient and responsibly developed CCUS projects at a greater scale. The report, which was mandated by the Utilizing Significant Emissions with Innovative Technologies (USE IT) Act passed in 2020, is another step by the White House to deploy CCUS as a part of its climate strategy.
The technology is not new and has been in development for a number of years already. Globally there are 26 commercial-scale CCUS projects in operation, with 45 CCUS facilities in development or operation here in the United States. One of the 45 facilities will be located in Houston and is slated to recover more than 50 million metric tons of CO2 by 2030, with a goal of doubling that output by 2040.
However, there are some regulatory and policy hurdles that are slowing down the development of CCUS facilities.The report put out by the White House Council on Environmental Quality (CEQ) lists a number of ways these hurdles can be eliminated. Here are some of the recommendations the White House suggests will accelerate CCUS projects nationwide.
One area identified by the White House CEQ that could be significantly overhauled is regulations. To speed up the CCUS implementation process, the report recommends implementing a new regulation, possibly overseen by the Department of Transportation, to ensure pipelines used for CCUS are safe and are being constructed correctly.
Recent regulatory changes to encourage CCUS have already proven successful. A CO2 pipeline in Wyoming used a new Federal environmental review and permitting process known as FAST-41. After FAST-41 was signed into law in December 2015, four voluntary large-scale infrastructure projects completed the permitting process five years later in 2020—representing more than ten years in time savings compared to non-FAST-41 projects.
Another area in which the federal government can increase its efficiency is by developing one holistic Environmental Impact Statement (EIS), or a programmatic EIS. By using a broader EIS that applies generally to the CCUS sector, the White House CEQ says it could get CCUS projects into the deployment phase much more quickly. In some sense, this should be self-evident: a streamlined process for reviewing projects – be it CCUS or anything else – will help ensure they are not caught up in bureaucratic delays.
The White House CEQ also recommends the use of the federal government’s procurement powers to support early markets for CO2 utilization. Utilization implies that the carbon taken out of the atmosphere would in a sense be recycled and used in other products like concrete. This area of CCUS is still underdeveloped but could have potential to become a tradeable commodity.
One benefit the CEQ report doesn’t touch on is the 45Q tax credit. Added to the IRS Code in 2008, the 45Q tax credit incentivizes the construction and deployment of CCUS projects by offering tax credits. And, although the 45Q tax credit has been amended throughout the years, Congress has the ability to ensure the 45Q credit remains in place for an extended period of time.
CCUS will play a vital role in reducing carbon emissions and achieving U.S. carbon reduction goals. With Texas’s abundant supplies of natural gas and extensive network of existing pipelines and infrastructure, the state has ample potential to become a national leader in CCUS. But to reach this technology’s full potential, it’s going to take effort from both the private sector and regulatory agencies to ensure that CCUS is deployed at the necessary scale.