A Major CCS Pipeline Network is on the Horizon if Permitting Challenges are Solved|
The purpose of this analysis is to highlight the major opportunities, and the challenges, in the potential for an extensive build-out of CO2 pipelines to help decarbonize industrial processes and power generation, while keeping liquid and fossil fuels prominent in America's energy portfolio.
Carbon capture and storage, with its necessary pipelines, offers one of the brightest scenarios for infrastructure investment and construction, both near and long-term. Two connected obstacles - opposition from environmental organizations, and a difficult permitting process - must be overcome before the immense opportunity of a new CO2 pipeline network spanning as much as 100,000 miles can become reality.
The map below generated by the Great Plains Institute from the Los Alamos National Laboratory's CCS model demonstrates what the network would look like in America's mid-continent when built to connect existing industrial and power generation CO2 sources with ideal underground storage formations.
This network is modeled to support net-zero CO2 by 2050, while keeping liquid fuels (both bio and petroleum based) and gas and coal fired power generation prominent in America's energy mix. While the current Administration is promoting CCS as essential to net-zero, opponents fight CCS in their quest to end both liquid fuels for transportation (surface and air) and fossil fuels for power generation.
With stopping CO2 pipeline projects their primary means of achieving those goals, opponents are exploiting the current state and local regulatory maze for CO2 pipeline permitting. We are now seeing state and county regulators throwing up barriers to the major CCS systems serving ethanol refineries under development in the corn belt.
Much of the regulatory push-back is in response to landowner objections based on safety concerns, fanned by opposition groups but nevertheless real. These concerns can be overcome by systems routed to avoid developed areas to the extent possible, and by adherence to tight safety standards for design, materials, construction and operation of CO2 pipeline systems that greatly lessen the likelihood of a rupture and mitigate the dangers if one does occur.
Another source of opposition is NIMBYism, or unwillingness to negotiate an easement on any terms for whatever reason. If a project is well-designed to minimize impacts during construction, is operated safely, and the developer fairly compensates the landowner for use of his land, NIMBYs are typically a very small percentage of the project route.
Beyond state regulatory agencies, another target for opponents are county governments along the projects' routes. At opponents' behests, some route counties have enacted ordinances typically requiring long-distance set-backs from occupied structures, which in some cases go well beyond reasonable safety concerns and are deliberately designed to make a compliant route extremely difficult or impossible. Developers' appeals to state regulators and legislative bodies to make more reasonable state laws pre-empt unworkable county requirements have so far been unsuccessful.
Necessary to receiving a permit from the relevant regulatory body (typically a state utility board or commission) is the developer's ability to demonstrate that the project is in the public's interest. Opponents have fanned opposition by claiming that any project providing for a private owner's financial gain is not in the public interest and should not be able to invoke eminent domain, which the permit enables. But any private investment must provide investors with returns or it would never happen.
For example, the public's interest in a privately-developed and operated natural gas pipeline is access to reliable and affordable energy. One compelling public interest in a CO2 pipeline is its potential to prevent release of major amounts of greenhouse gas from industrial processes and power generation. Another, in the case of pipelines serving the ethanol refining industry, is adding value to and demand for the region's corn used to produce low-carbon fuel, which underpins the prosperity of the areas' farms and rural economies.
To illustrate the major upside opportunity CCS holds for farmers, consider the potential for production of "sustainable aviation fuel" (SAF) from corn ethanol coupled with CCS. The market potential is estimated at 35 billion gallons annually by 2050, dwarfing today's 15 billion gallons of ethanol now blended into gasoline. This is more than a pipe dream.
For example, the Colorado-based firm Gevo is planning a South Dakota plant to produce SAF, with initial commitments from American Airlines and Delta to offtake 1.1 billion gallons between 2025 and 2032. At 2.5 gallons of ethanol per bushel of corn, that will take 440,000,000 new bushels - or an average of about 63 million bushels per year. From just those two customers, that represents an extra 10% on top of South Dakota's current rate of corn production. The project requires Summit Carbon Solution's proposed pipeline to transport Gevo's captured CO2 to permanent storage in North Dakota.
So there is great potential for ethanol-based SAF to drive major new demand for corn, but only if CO2 pipelines can be built.
As shown in the graphic above, the opportunity for CCS and CO2 transport to reduce carbon emissions from other industrial processes such as steel, cement, fertilizer, hydrogen production, and petrochemical manufacturing; as well as for natural gas and coal power generation, should also command the full attention of stakeholders in pipeline transport infrastructure investment.
The proposed new CO2 pipeline systems serving ethanol refineries that are now navigating through the local and state permitting maze in the upper Midwest simply must prevail. They are the pioneers whose success will set the stage for a much bigger network to come.
EEIA is committed and working hard to help them overcome a richly-funded and well-organized opposition. We need and welcome support from supply chain stakeholders who build and supply equipment, materials and services needed to bring them to fruition, and who will thrive on the many new projects that will follow.