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CCS IN THE AMERICAS | January 2023 Recap

This newsletter provides updates on policy and advocacy events important to the work of the Global CCS Institute in the Americas.


This year is starting with all the earmarks of being noteworthy for the deployment of carbon capture and storage as a vital mitigation tool for reaching carbon neutrality across the Americas.  Accordingly, January 2023’s key events  are organized in  this  newsletter as follows. 

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Table of Contents

  1.  United States – Federal (Policy/Legislation/Regulation) 
    1.  Executive Branch
  2. United States – States (Policy/Legislation/Regulation)  
    1. Alaska
    2. Illinois
    3. Louisiana
    4. North Dakota 
    5. West Virginia
  3. United States - Public Company
  4. Canada -  Federal (Policy/Legislation/Regulation)
  5. Canada -  Federal (Policy/Legislation/Regula 
  6. Areas to Watch 
    1. Brazil 
    2. Canada
  7. Other News 
    1.  Carbon Credits and Carbon Markets 
    2. ESG 
    3. Environmental Justice 
    4. Reports 
    5. Utilization 

     

United States – Federal (Policy/Legislation/Regulation) 

EXECUTIVE BRANCH 

Department of Energy (DOE).  Office of Fossil Energy and Carbon Management (FECM)  posted its 2022 Year in Review on 12/22/2023.  


Council on Environmental Quality (CEQ).National Environmental Policy Act Guidance on Consideration of Greenhouse Gas Emissions and Climate Change. On 01/09/2023, the CEQ issued  interim guidance to assist agencies in analyzing the greenhouse gas (GHG) and climate change effects of their proposed actions under the National Environmental Policy Act (NEPA).  The guidance states that agencies should consider available mitigation measures that avoid, minimize, or compensate for GHG emissions and climate change effects when those measures are reasonable and consistent with achieving the purpose and need for the proposed action.  The mitigation measures may include carbon capture and sequestration.  While the guidance is effective immediately, CEQ will take comments on the guidance until March 10, 2023. 


EPA. EPA Announces Availability of $50 Million to Support States and Tribes Developing Programs for Carbon Sequestration and Groundwater Protection.  On 01/19/2023, the EPA announced the availability of $50 million in grant funding from President Biden’s Bipartisan Infrastructure Law to help states, Tribes, and territories develop and implement Underground Injection Control (UIC) Class VI programs. EPA supports efforts by states, Tribes, and territories to implement existing primacy programs and seek primary enforcement and permitting responsibility (primacy) for Class VI programs. Therefore, EPA is inviting states, Tribes, and territories to submit letters of intent to indicate their interest in this new funding, and interested parties have until March 20, 2023, to submit their letters. 

 

The White House. The Inflation Reduction Act Guidebook  is available.  The guidebook groups the Inflation Reduction Act’s tax incentives and investment programs into thematic chapters and explains how the law will deliver on the Administration’s commitments.  

     

United States – States (Policy/Legislation/Regulation)

ALASKA  Alaska Governor Mike Dunleavy introduced Senate Bill (SB) 48, SB 49, House Bill (HB) 49, and HB 50, his Carbon Management and Monetization Bill Package, creating statutory and regulatory structures needed to capitalize on carbon markets. The package consists of two pieces of legislation focusing on a carbon offset program; and carbon capture, utilization, and storage (CCUS) program. 

 

ILLINOIS  Carbon Management.  The Prairie Research Institute (PRI) at the University of Illinois Urbana-Champaign, in consultation with an intergovernmental advisory committee, pursuant to Public Act 102-0341, filed its report on the potential for carbon capture, utilization, and storage (CCUS) as a climate mitigation technology throughout Illinois 

 

LOUISIANA Judge Rules Against Moratorium on Carbon Capture Project.  “A federal judge has ruled that a south Louisiana parish cannot enforce a moratorium blocking [Air Products] from conducting seismic tests or building test wells in Lake Maurepas.  U. S. District Judge Shelly Dick of the Middle District Court of Louisiana ruled Dec. 26 in favor of a motion for a preliminary injunction against the moratorium and denied Livingston Parish's motion to dismiss the lawsuit, giving the company [Air Products} the go-ahead to continue the project as planned.” 

 

NORTH DAKOTA ND legislative hearings on CO2 Pipeline bills draw big crowds; eminent domain is the main issue. The Senate Energy and Natural Resources Committee heard testimony Thursday, Jan. 26, and Friday, Jan. 27, on eight bills dealing with carbon dioxide pipelines and eminent domain — the seizure of private property rights against a landowner's wishes. All eight are sponsored by Sen. Jeff Magrum, R-Hazelton, and come in response to Summit Carbon Solutions’ proposed CO2 pipeline that the North Dakota Public Service Commission is reviewing. Some opponents believe the legislation, if passed, could hamper the coal and oil industries in the state. 

 

WEST VIRGINIA West Virginia bills pass on carbon sequestration, hydrogen hubs.  Two bills designed to make it easier for West Virginia to attract hydrogen hubs and carbon sequestration projects to the state are headed to Gov. Jim Justice for signing. 


     

United States - Public Company

California Resources Corporation (NYSE: CRC) announced a Carbon Dioxide Management Agreement (CDMA) between Carbon TerraVault Holdings, LLC (CTV) and Grannus, LLC (Grannus), an independent clean-tech company that is building a portfolio of blue ammonia and hydrogen production facilities to supply the agriculture, mobility and marine fuel markets, to sequester 370,000 metric tons (MT) of carbon dioxide ( CO2) per annum at CTV III from a new blue ammonia and hydrogen plant to be constructed in Northern California. See announcement. 

     

Canada- Federal 

(Policy, Legislation, Regulation)

Minister of Natural Resources.  On 01/25/2023, the Honorable Jonathan Wilkinson, Minister of Natural Resources, opened the intake for expressions of interest for carbon capture, utilization, and storage (CCUS) research, development and demonstration (RD&D) projects and related science activities focused on carbon storage and transportation. The intake is also expected to support planning and development activities for CO2 storage and transportation hubs — addressing technical, scientific, or social license barriers and generating knowledge to support the development of regulatory frameworks, codes, and standards.  The intake for expressions of interest for storage and transportation RD&D projects and related science activities will remain open until April 17, 2023. 

     

Canada- Province

(Policy, Legislation, Regulation)

ALBERTA TIER Amendments Provide Price Certainty and Incentivize Carbon Capture and Storage. On 01/01/2023, significant amendments to Alberta’s Technology, Innovation and Emissions Reduction Regulation (TIER) came into effect. The amendments align TIER with the federal Greenhouse Gas Pollution Pricing Act (GGPPA), facilitate TIER participation by the proponents of carbon capture and storage (CCS) projects, provide price certainty, and seek to address a potential surplus of provincial carbon credits in the coming years. 

     

Areas to Watch in the Americas

CANADA 

Canada's Energy Jobs Transition Bill Sparks Discord in Oil Heartland.  According to Reuters, in Canada's western oil patch, controversy is raging over federal government legislation intended to help the fossil fuel labor force transition to a greener economy. However, union and community leaders are warning politicization of the Just Transition bill obscures the needs of workers. "This shouldn't be a political issue, this is an issue about what's really happening in the global economy," said Gil McGowan, President of the Alberta Federation of Labor (AFL)… “If done right, the bill could incentivize technologies like carbon capture and hydrogen and be Canada's answer to the U.S. Inflation Reduction Act, the $430-billion green energy subsidy package passed last year,” McGowan added.  


Order Adding Carbon Dioxide Streams to Schedule 5 of the Canadian Environmental Protection Act, 1999  Proposals for carbon dioxide ( CO2) sequestration projects are expected for the Cascadia Basin off Vancouver Island. ECCC [Environment and Climate Change Canada] will require CO2 to be on Schedule 5 of the Canadian Environmental Protection Act, 1999 (CEPA) to consider permitting the activity. Currently, Schedule 5 of CEPA does not include carbon dioxide, and as a result, seabed sequestration of carbon dioxide, a potential tool for use against climate change, cannot be granted a permit and is prohibited.  


BRAZIL 

Brazil Continues to Implement Social, Environmental, and Climate Change Regulatory Reforms.  A National Law Review article highlights Brazil’s new administration.  “The administration is pursuing its social, environmental, and climate agendas, including significant institutional restructuring, repealing  previous administration policies, and announcing several new policy directions. The changes are significant, unprecedented, and unequivocally signal a government-wide emphasis on social, climate, and environmental matters to the full extent of executive branch power.” 

     

Other News

This section is for other news that may directly or indirectly impact CCS deployment


CARBON CREDITS AND CARBON MARKETS 


ESG 
  • Carbon Dioxide Capture and Storage:  A Pathway for Greenhouse Gas Emissions Reductions. On 01/27/2023, the Jenner and Block law firm issued an alert calling attention to the fact that as businesses continue to optimize their environmental, social, and governance (ESG) strategies, an important arrow in the ESG quiver may be carbon dioxide ( CO2) capture and storage (CCS).  The alert states that the effectiveness of carbon capture, coupled with the robust storage capacity available in the United States, makes CCS a promising method to minimize the climate-forcing effects of CO2 emissions 


ENVIRONMENTAL JUSTICE

  • Governor Hochul Approves Environmental Justice Amendments to SEQRA On 12/30/2023, “Governor Hochul approved a bill passed by the New York State Legislature (S8830/A2103-D), which incorporates environmental justice concerns into the State Environmental Quality Review Act (SEQRA) review process and the New York State Department of Environmental Conservation’s (NYSDEC) state permit approval process. Governor Hochul’s approval of the law is subject to the legislature making changes that have already been agreed to but have not yet been released (Approval Memorandum, No. 115).” 
  • Biden-Harris Administration Announces Availability of $100 Million through Inflation Reduction Act for Environmental Justice Grants.  On 01/10/2023, “ U.S. Environmental Protection Agency (EPA) announced the availability of approximately $100 million for projects that advance environmental justice in underserved and overburdened communities across the country. This funding, made possible through President Biden’s Inflation Reduction Act, marks the largest amount of environmental justice grant funding ever offered by the Agency. EPA has published two Requests for Applications for this funding through the Environmental Justice Collaborative Problem-Solving (EJCPS) Cooperative Agreement Program and the Environmental Justice Government-to-Government (EJG2G) Program.  
  • California.  The National Law Review reports  AB 617, a landmark environmental justice statute passed by the California legislature in 2017, required air districts with nonattainment status to adopt timelines to ensure implementation of Best Available Retrofit Control Technology (BARCT) as soon as feasible, but no later than December 31, 2023. Since then, affected air districts have been crafting and adopting such rules (the South Coast Air Quality Management District (SCAQMD), for example, has already adopted 14 such rules, according to CARB). [There is likely to be] a rush from affected air districts to finalize rules currently in development to meet the December 31, 2023, deadline. 

 

REPORTS  

  • Powering Toward 100 Percent Clean Power by 2035 The Path to Carbon-Free Electricity (1/2023). A report by the Natural Resources Defense Council and Evergreen Act stated that the Biden administration won’t be able to meet its climate goals without Clean Air Act carbon rules. The report says, “EPA must proceed with new rulemakings that conform to West Virginia v. EPA’s constraints, by setting standards based on technology that causes individual plants to “operate more cleanly.” Such standards could be based on the emission reductions achievable through improvements to the plant’s operating efficiency; co-firing with a cleaner fuel, such as co-firing coal with gas, or gas with hydrogen; or installing CCS.” 
  • US Strategy Sees Onboard Carbon Capture as ‘Promising Technology for Shipping Decarbonization.  The DOE, EPA,  US Department of Transportation,  and the Department of Housing and Urban Developments issue a Blueprint offering a whole-of-government approach to transform the transportation sector and sets forth an interagency call to action to coordinate and work effectively together. Achieving the climate goals will require close cooperation with industry, local, regional, state, and Tribal governments, non-profits, and other stakeholder groups and allies worldwide.  The report contains language that supports onboard carbon capture technology in its strategy for decarbonizing transport. 

UTILIZATION

  • DOE’s Bioenergy Technologies Office announced on 01/20/2023 National Labs Research Better Uses for Carbon Dioxide. A collaborative team of U.S. Department of Energy Bioenergy Technologies Office (BETO)-funded scientists from Argonne National Laboratory (ANL) and National Renewable Energy Laboratory (NREL) are examining how to make better use of CO2 generated by industry, transportation, and agriculture by turning it into sustainable aviation fuel and other useful products.

     
 
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