See MoreSince Exxon went public with its proposal last year, Congress has given the Energy Department $20 billion to spend on carbon capture and clean hydrogen projects and has authorized another $250 billion in loan guarantees for these and other emissions-cutting technologies.
“We’re not penalizing them, we’re considering paying them,” he added. “That to me couldn’t be more backwards.” Exxon, Chevron and others have proposed some of the first projects that could begin to make up the hub, but they have yet to publicly commit anything beyond small initial investments. Still, many policy experts have come to believe that some amount of carbon capture will be needed to meet climate targets, and the Biden administration has made the technology a key part of its climate policies. So the Houston hub, perhaps the biggest and boldest plan to capture carbon from smokestacks, is drawing significant attention from major corporations and the federal government.
On the day the company announced the proposal, Woods and Joe Blommaert, who was then chief of Exxon’s low carbon business, wrote a column for the Wall Street Journal arguing that the Houston hub would help the nation meet its climate targets and serve as a model for the world.
Within weeks, the commissioners of Harris County, home to Exxon’s Baytown refinery and many of the industrial facilities along the Houston Ship Channel, passed a resolution in support of the company and the proposal, too. Charisma Troiano, an Energy Department spokeswoman, declined to elaborate on what was discussed at the meeting with Exxon, saying only that “the department and the secretary meet with a lot of companies interested in carbon capture given the recognition that it is needed to reach President Biden’s net zero by 2050 goals.”
This tax credit change is likely the most important subsidy of all for the Houston hub: 50 million metric tons of carbon dioxide could work out to more than $4 billion annually. Companies have until 2033 to begin construction to qualify for the credit and are eligible to receive it for 12 years. Earlier this year, Woods spoke directly of the company’s carbon capture efforts at a major oil industry conference in Houston.
This concentration of polluting industry happens to sit next to some of the best geology for storing carbon dioxide underground: Formations beneath the Gulf of Mexico could hold more than 100 billion tons of CO2, according to one study. Add in the fact that the companies already hold many pipeline rights of way and enjoy the permissive oversight of Texas regulators, and you have what many experts say is the ideal place to build a major carbon capture hub.
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