Carbon Capture and Storage: Beyond the Permit
Phoebe Fu, Analyst at Future 500. Published October 13, 2023
Our Corporate Affinity Network and invited guests had a blast discussing carbon capture and sequestration with Ashleigh Ross, VP of Strategic Engagements & Policy, Carbon America, who “started working on carbon capture before Google became a verb”. Ashleigh voiced insights from over 20 years working in the carbon capture and sequestration (CCS) space — sharing the criticality of companies adopting a community-centric approach that speaks to environmental and social needs, how she has seen and continues to see companies falter in doing that, and opportunities and risks she sees in coming years for the planet, communities, and business.
With growing community skepticism of CCS as a false climate solution, here are four key takeaways from Ashleigh for progressing CCS projects using approaches with a high Technology Readiness Level (TRL)*
1. Consent
Simply having your permit and eminent domain does not grant you a social license. For CCS projects (all projects that impact local communities), it’s essential to use community-centric decarbonization approaches. This includes offering CCS as an option for decarbonization, using “consent-based siting” with open transparency throughout the project, and robust adaptive systems for processing two-way feedback. Before starting on CCS projects, companies must educate their community on what CCS is and isn't to build and maintain trust and break any misconceptions.
Ultimately, if your CCS project generates negative news headlines, having a permit hardly matters because the lack of consent, particularly in the nascency of the project, can revoke your social license to operate.
2. Think long-term
CCS project developers must think long-term to build the trust needed for enduring community consent. While the 45Q incentive will expire in 12 years, companies engaged in CCS should prepare to meet their goals and be good stewards in perpetuity. CCS may grow in the future, and some communities (and smart companies and investors) have expectations that equal or comparable compensation or benefit sharing will be key to keeping projects working smoothly long-term. Thinking beyond the 12 years is key to setting up future success built on a durable social license to operate regardless of government incentive.
3. Think local, local, local
Localize the benefits and manage the externalities. Keeping projects nuanced and attuned to evolving community needs, informed by site-specific data (e.g. seismic data) and relationships, will allow not just an easier time to steward your projects but can open the doors for future scaling if the community trusts you as a working partner.
This includes shifting your framing from industry-centric (e.g., “building hubs,” achieving “economies of scale”, prioritizing industry relationships over local ones, etc.). You must show communities the benefit they will receive for having these projects on their lived lands — not just setting the well-meaning but obscure goal of providing benefit for the greater global community via emissions reduction.
4. Get creative
Particularly with compensation for landowners. CCS is currently a federally incentivized project where landowners can and should materially benefit by agreeing to be long-term carbon stewards. While certain states, such as North Dakota and Nebraska, may take on stewardship of (and hence liability for) a project over time, private landowners are crucial stewards for initiating many projects. So, CCS project developers must find creative ways to compensate landowners and the community, such as:
executing a community benefit agreement to qualify the project for Inflation Reduction Act (IRA) funding,
helping a landowner secure a carbon steward tax credit,
the project developer collaborating with the community to extend the conservation part of the farm bill to incentivize soil sequestration and
designating shared revenue to fund community-determined priorities, such as local schools.
Community opposition to carbon capture projects and pipelines is rising in part because project developers keep relying on antiquated one-side-fits-all models they know, such as the oil and gas royalty structure, which might remunerate an individual landowner but is not adaptable to meet each community and landowner’s unique needs. Engaging and collaborating proactively upfront is table stakes, and is the key to more likely earning durable, win-win projects with increasingly skeptical communities and landowners.
*Note: TRL was coined from NASA’s standardization and is now applied widely to other industries, in this case CCS.
Future 500 is a non-profit consultancy that builds trust between companies, advocates, investors, and philanthropists to advance business as a force for good. We specialize in stakeholder engagement, sustainability strategy, and responsible communication. From stakeholder mapping to materiality assessments, partnership development to activist engagement, target setting to CSR reporting strategy, we empower our partners with the skills and relationships needed to systemically tackle today's most pressing environmental, social, and governance (ESG) challenges.
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