Carbon capture potential reliant on tax credits, like green energy

By Anthony Hennen | The Center Square

HARRISBURG, PA — Carbon capture and storage in Pennsylvania has some energy experts excited, but to get the public on board, it’ll take something more than industry experiments.

The Department of Conservation and Natural Resources held an online webinar Thursday to discuss the future of carbon capture, which removes carbon dioxide from the atmosphere for productive use or storage underground, in the commonwealth.

And while Pennsylvania’s geography and natural resources make it a prime target to the industry, many experts admit the economics don’t work without tax credits – as is the case for wind and solar power, too.

The idea for carbon capture is to lower emissions and reduce the environmental and health impacts of industries like coal and natural gas.

“We make energy, we generate power,” Kristin Carter, an assistant state geologist at DCNR, said. “We make concrete, steel, hydrocarbons, pulp and paper, chemicals, etc. We’ve got multiple categories of CO2 emissions all over the state, and for that reason we’re a big part of the problem. So we need to lean into this challenge of climate change mitigation.”

She argued that the opportunity for carbon capture in Pennsylvania is “pretty substantial,” with an estimated 2.4 billion metric tons of storage capacity in the state. Pennsylvania produces about 266 million metric tons of carbon dioxide per year.

Carbon capture could give the economy a boost as well as the environment, others argued.

“America, fortunately, we have an innovative view and ethos. We really are a ‘both-and’ kind of society,” Perry Babb, CEO of KeyState Energy, said. “With the technology and a lot of hard work, we really can have historic emissions reductions along with historic job creation.”

Babb has proposed a $2 billion hydrogen project in West Keating Township, Clinton County with carbon capture technology, though the Clean Air Council says the project has “far too many unknowns.”

“We can have job creation that’s not transitory,” Babb said. “This combination of natural gas supply and very low-carbon intensity reforming of natural gas to hydrogen with carbon capture and storage is going to make Appalachia a hydrogen superpower for the next 30, 40 years.”

Beyond natural gas, coal companies see an opportunity with carbon capture.

Jacqueline Fidler, vice president of environmental and sustainability with Consol Energy, said the company is looking to permanently sequester 3 million tons of carbon dioxide per year in southwest Pennsylvania or West Virginia.

Consol wants to “provide CO2 storage for the life of our power plant, which is estimated to be 20-25 years or more,” Fidler said. “So we’re looking for a reservoir that could handle 60-75 million tons of CO2.”

More exploration needs to be done in Appalachia to know how much carbon dioxide can be stored in the region, she said.

There’s also, she noted, an economic problem. Carbon capture “would heavily depend on support from the federal government,” particularly tax credits.

In that financial dependence, carbon capture shares ground with wind and solar power.

“It is important for the public to understand that, at this time, the commercial viability of these projects, not unlike certain renewable energy projects, rely on government support like tax credits to achieve favorable economics,” Fidler said. “Work is still needed to optimize economics and address certain challenges to be economically useful.”

What the public needs to see, Babb argued, is a working project.

“We need — desperately — a demonstration,” Babb said. “I don’t mean on an experimental scale, but a business … once there’s a facility where people can come to and see it done, it’s on then. That mystery’s taken away.”
So far, a working demonstration has been hard to come by. The Department of Energy has invested more than $1 billion in carbon capture projects since 2009, mainly focused on coal, that have not panned out.

The DOE’s selection process, the Government Accountability Office noted, “increased the risks that DOE would fund projects unlikely to succeed,” and cost controls to limit financial risks were not adhered to “at the direction of senior leadership.”