Hoeven: North Dakota Leading the Way in CCUS, Key to the Future of America's Energy Security

Senator Addresses Basin Electric’s Annual Meeting

BISMARCK, N.D. – At Basin Electric Power Cooperative’s annual meeting today, Senator John Hoeven outlined how North Dakota is leading the way in cracking the code on carbon capture, utilization and storage (CCUS). In particular, the senator highlighted the proposed expansion of carbon capture at the Great Plains Synfuels plant, which will enable the facility to capture up to 3.5 million tons of CO₂ per year. This will be the largest coal-based, geologic carbon storage project in the world and make the facility the first to use both enhanced oil recovery and geologic storage for CCUS. Hoeven stressed that efforts like this are critical to America’s continued energy and national security, as they will enable the nation to continue utilizing all of its abundant energy resources, including coal, while reducing emissions.

To this end, Hoeven worked as governor to create a regulatory framework for carbon storage in the state, resulting from the North Dakota CO₂ Storage Workgroup he established in 2008 and a bill he advanced through the state legislature to grant this authority to the North Dakota Industrial Commission. The state also enacted legislation that granted ownership of the pore space to the owner of the overlying surface estate. Then, as U.S. Senator, Hoeven:

Moved the state’s application for regulatory primacy over Class VI wells forward at the Environmental Protection Agency (EPA) and successfully pressed for its approval in 2017.

This authority provides certainty to project developers and better enables projects like this to use Class VI wells for geologic storage of CO₂.
North Dakota is one of only two states to have this regulatory authority.

Worked to get the 45Q carbon capture tax credit implemented in a way that makes CCUS projects more commercially-viable.

The senator also secured a Revenue Ruling from the Internal Revenue Service (IRS) and the Department of the Treasury ensuring that coal gasification projects, such as the project at the Great Plains Synfuels plant, are eligible for the 45Q tax credit.

Funded critical loan guarantees at the U.S. Department of Energy (DOE) and Rural Utilities Service (RUS).

“Basin Electric and its member cooperatives not only provide affordable and reliable energy to our state and the surrounding region, they are also helping North Dakota to continue leading the world in deploying CCUS technology,” said Hoeven. “The expansion of carbon capture at the Great Plains Synfuels plant is one of many firsts that our state has achieved in these efforts. We reached this point by providing regulatory certainty, a pro-growth business environment and the right incentives to advance this technology. That’s the path forward to ensure our nation remains energy secure – not through burdensome regulations and unworkable mandates. CCUS is a key part of growing our domestic energy production, which benefits consumers through lower prices and leads to a stronger economy as well as a more secure nation.”

Securing the 45Q Tax Credit

The 45Q tax credit provides an important new revenue stream for CCUS projects of up to $50 per ton for CO₂ permanently stored, or up to $35 per ton for CO₂ stored and used for enhanced oil recovery. After helping pass legislation to reform and expand the 45Q tax credit, Hoeven worked to advance its implementation. His efforts included:

Working closely with the Trump administration to move the final 45Q regulations forward.
Passing legislation providing a two-year extension on the construction deadline for the 45Q tax credit.

Cracking the Code on CCUS

Moving forward, Hoeven is advancing the following priorities to crack the code on CCUS, which will enable the nation to continue making use of its abundant energy resources, while reducing emissions:

Front end investment in technology development, including bolstering the partnership between DOE and the University of North Dakota’s Energy & Environmental Research Center (EERC).
Loan guarantees to help project developers secure financing to build the equipment and infrastructure needed to capture and store CO₂.
Enhancements for the 45Q and 48A Advanced Coal tax credits to provide important revenue streams to project developers and encourage adoption of CCUS:

Sponsored legislation to modernize the 48A tax credit for CO₂ capture retrofit projects.
Helped introduce a bipartisan bill to provide a direct payment option for the 45Q and 48A CCUS tax incentives.
Joined legislation to increase the value of the 45Q tax credit and make it more accessible to CCUS projects of all sizes.

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