This story was originally published bymadAnd here it is reproduced as part of that.Climate Deskcollaboration.
In the past For years, the U.S. has been a major hub for companies looking to suck carbon dioxide out of the sky. There are a few pilot-scale direct air capture (DAC) plants around the world, but the ones planned in Louisiana and Texas are different in scale. They aim to capture millions of tons of carbon dioxide a year, rather than the tens of tons or less that existing systems capture.
The United States has several advantages when it comes to DAC. It has the right kind of geology to store pumped CO2 underground, it has an oil and gas industry that knows a lot about drilling into the ground, and it has federal grants and subsidies for the carbon capture industry. Projects in Louisiana and Texas are eligible for up to $1.05 billion in DOE funding, and the projects could qualify for a tax credit of up to $180 per ton of CO2 stored.
“It’s clear that the U.S. is a leader in policies that support this emerging sector,” says Jason Hochman, executive director of the Direct Air Capture Coalition, a nonprofit working to accelerate deployment of DAC technology. “At the same time, it’s nowhere near what’s needed to get on track to the scale needed to get to net zero.”
The Heritage Foundation is not only skeptical of the carbon removal industry, but is also openly skeptical of climate change.
But support for carbon storage is not guaranteed. Project 2025, the Heritage Foundation’s nearly 1,000-page policy blueprint for Trump’s second term, would dramatically roll back policies that support the DAC industry and carbon capture more generally. The Project 2025 Mandate for Leadership document would eliminate DOE’s Office for Clean Energy Demonstrations, which funds DAC facilities and carbon capture projects, and would require a 45Q tax credit to support carbon capture, use, and storage, which captures and stores carbon dioxide from power plants and heavy industry. (The Heritage Foundation did not respond to WIRED’s request for comment.)
Sucking carbon out of the sky is not without controversy. Not least because the oil and gas industry is involved in the sector, but the Intergovernmental Panel on Climate Change’s Sixth Assessment Report says that achieving net zero carbon will require using carbon dioxide removal to balance emissions from sectors like aviation and agriculture. Carbon dioxide removal can mean planting trees and sequestering carbon in soil, but technologies like DAC are attractive because the amount of carbon sequestered is easy to measure and the stored carbon must remain locked up for a very long time. This is not necessarily the case with forests and soils.
DAC technology is very new, and the plants built so far are small, so removing carbon from the atmosphere this way is still prohibitively expensive. Estimates of the cost of extracting carbon range from hundreds of dollars to more than $1,000 per ton, but Google has announced that it will pay $100 in DAC removal credits for the carbon it sequesters in the early 2030s. Moreover, building a large-scale DAC plant would likely cost hundreds of millions to billions of dollars.
That’s why government support like the DOE Regional DAC Hub program is so important, says Jack Andresen of Breakthrough Energy, an initiative founded by Bill Gates to accelerate technologies to reach net zero. “That’s how you build projects,” he says. The bipartisan infrastructure bill signed into law in 2021 set aside $3.5 billion in federal funds to help build four regional DAC hubs. That’s where the Louisiana and Texas projects are headed.
Climeworks is one of the companies working on the Louisiana DAC hub, which is eligible for up to $550 million in federal funding. Ultimately, the facility aims to capture and store more than 1 million tons of carbon dioxide annually underground. “If you want to build an industry, you can’t do it with a demonstration project,” says Daniel Nathan, Climeworks’ chief project development officer. “You have to actually spend money, not just talk about it, and say there are certain projects that deserve more funding.” Once the hub begins sequestering carbon, it can claim up to $180 per ton of carbon stored under the Inflation Reduction Act’s extended 45Q tax credit.
“You can’t start an industry with social benefits in mind unless the government plays an active role.”
These tax credits are important because they provide long-term support to companies that actually sequester carbon from the atmosphere. “There’s a guaranteed revenue stream of $180 per ton for at least 12 years,” says Andreasen. That’s especially important because the cost of capturing and storing a ton of carbon dioxide is likely to exceed the market price of carbon credits in the long term. Other forms of carbon removal, particularly forestation, are much cheaper than DAC, and removal offsets are also competitive with renewable energy offsets that don’t produce new emissions. Without additional government support, the DAC sequestration market won’t be able to sustain itself.
Most DAC industry experts interviewed by WIRED saw little political appetite to overturn the 45Q tax credit, which would allow companies to claim the credit for physically extracting more oil from existing reservoirs using carbon dioxide. But they were more concerned about the possibility that existing DOE funds set aside for DAC and other projects would not be allocated by a future administration.
“I think DOE is slowing down,” Andreasen said. “It just means it’s going to take longer to get the money out, and that’s not good.” Katie Lebling of the World Resources Institute, a sustainability nonprofit, agreed, saying there’s a risk that unallocated funding could slow down or even stop if the new administration takes a less favorable view of carbon removal.
The Heritage Foundation is not only skeptical of the carbon removal industry, but is openly skeptical of climate change. One report states that the observed warming could “theoretically” be due to fossil fuel combustion, and that “this claim cannot be substantiated by science.” In its Project 2025 plan, the foundation says that “governments should not pick winners and losers, nor should they subsidize the private sector to bring resources to market.”
But without government support, the private sector won’t be able to develop technologies like DAC, says Jonas Meckling, an associate professor at the University of California, Berkeley, and a climate fellow at Harvard Business School. The same goes for the solar industry, he says. “You can’t start an industry with social good in mind unless government plays an active role,” says Climeworks’ Nathan.
While there are questions about the future of DOE funding for DAC, the industry is appealing to lawmakers in both parties. The Texas DAC hub is being built by 1PointFive, a subsidiary of Occidental Petroleum, and both DOE projects are in solidly red states. When it was announced that DOE DAC hub funding would be used in Louisiana, Senator Bill Cassidy said, “Carbon capture opens a new era of energy and manufacturing in Louisiana. It’s the future of job creation and economic development in our state.”
The goal, Nathan says, is to make DAC economically viable in the long term. Over time, he says, there will be regulations that require industries to pay for carbon removal—a more stringent version of emissions trading schemes that already exist in places like California and the European Union. Eventually, that will be where the air industry can remove carbon from the atmosphere at scale without needing any more government support. “I’m looking at the fundamentals, and it’s not going to be determined by who’s in power,” Nathan says.
