White House Puts Up $2 Billion In Loans For Controversial Buildout Of CO2 Pipelines

The new program may draw fire from environmentalists, but decarbonization experts say the infrastructure is needed to hit climate goals.
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Midwestern facilities like this ethanol refinery in Chancellor, South Dakota, could be among the first to benefit from new CO2 pipelines.
Midwestern facilities like this ethanol refinery in Chancellor, South Dakota, could be among the first to benefit from new CO2 pipelines.
via Associated Press

To hit its climate goals, the United States is betting on technology that captures planet-heating carbon dioxide at industrial plants before it enters the atmosphere. For that hardware to make sense financially, the country will need as many as 30,000 miles of new pipelines ― more than all the gas pipelines in California, New York and Pennsylvania combined — to ship that CO2 from where it’s captured to where it can be used or buried underground.

The Biden administration is ready to make the down payment on that infrastructure buildout.

On Thursday, the Department of Energy launched a $2 billion loan program to fund construction of pipelines, rail transport and other shipping methods, the agency told HuffPost. Called the Carbon Dioxide Transportation Infrastructure Finance and Innovation program, or CIFIA, the fund will be available through 2026, unless it’s fully spent before then, and will be administered jointly by the Energy Department’s Loan Programs Office and Office of Fossil Energy and Carbon Management.

“One giant challenge in deploying carbon management technologies to reduce emissions is to be able to transport the CO2 to where it is ultimately sequestered or used up,” Energy Secretary Jennifer Granholm said in a statement to HuffPost. “The CIFIA program will help industry overcome the challenges to accessing the upfront capital needed to build shared infrastructure projects that are essential to advancing our clean energy economy.”

The program will undoubtedly draw some controversy, and possibly resistance from landholders and other stakeholders regarding proposed pipelines.

The U.S. has operated a small network of carbon dioxide pipelines for more than half a century. Until 2020, it was widely viewed as safe. But that year, a CO2 pipeline ruptured in Satartia, Mississippi, spewing a cloud of carbon dioxide that sickened dozens of people in the surrounding area, a HuffPost investigation found in 2021. Since CO2 pushes out the oxygen needed to ignite an engine, the accident disabled motor vehicles, making it impossible for victims to escape.

In response, the U.S. Department of Transportation’s Pipeline and Hazardous Materials Safety Administration announced in May it would set new rules and standards for CO2 pipelines. The agency is scheduled to unveil its new proposals later this year.

Energy Secretary Jennifer Granholm testifies before a Senate committee about the 2023 budget for the Department of Energy.
Energy Secretary Jennifer Granholm testifies before a Senate committee about the 2023 budget for the Department of Energy.
NICHOLAS KAMM via Getty Images

But the agency is perennially understaffed, and President Joe Biden has yet to nominate an official leader. The agency has few new tools or inspectors to help carry out its widening portfolio of tasks, according to a Roll Call report.

Landowners and environmentalists who oppose new pipelines are also organizing against proposals like the Summit Carbon Solutions plan to build a 680-mile project through Iowa for carbon dioxide captured at ethanol plants.

The vast amounts of farmland and fertilizer needed to grow corn for ethanol can translate into 24% higher emissions for the biofuel than equivalent quantities of gasoline, according to one recent study. And environmentalists have long complained that propped-up carbon capture technology generally makes it easier to keep using fossil fuels even when alternatives that are safer for the climate exist, particularly in sectors such as electricity generation.

But experts say there are few better options to decarbonize parts of the industrial sector that depend on fossil fuels to reach the high temperatures needed for making chemicals, steel and cement ― all of which are set to surge in demand as the country builds more renewable-energy plants, power lines and electric vehicles.

If recently enacted tax credits for capturing carbon dioxide are “not used at a wide variety of industrial facilities, then something has gone very seriously wrong,” Rebecca Dell, a carbon capture expert and the industrial emissions lead at the San Francisco-based ClimateWorks Foundation, told HuffPost in August.

That, she said, “is going to require pipelines.”

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