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Capturing Opportunity

Law and Policy Solutions to Accelerate Engineered Carbon Removal in California

To reach its carbon neutrality goals, California must deploy new methods of removing carbon directly from the atmosphere to account for past emissions, as well as methods of capturing carbon from industrial sectors that will be among the last to switch to low-emissions processes due to a lack of technological alternatives. In both cases—removing past emissions and preventing future emissions—the state must find ways to store carbon safely on a permanent, geologic timescale. Planning and early implementation must begin as soon as possible to allow adequate time for the technologies to scale up if California is to achieve its 2045 carbon neutrality target. This report examines engineered carbon removal options, barriers to these technologies, and policy solutions.

Engineered negative emissions technologies include biomass conversion (such as bioenergy with carbon capture and storage, or BECCS) and direct air capture with carbon capture and storage (DACCS). BECCS and DACCS remove past emissions from the atmosphere. Carbon capture from difficult-to-mitigate sectors like industrial facilities avoids new emissions from processes like cement manufacturing.

Captured carbon may be utilized in several manufacturing or industrial processes before or instead of permanent storage. Products or processes should be long-lived, such as concrete or other building materials.

These projects should enhance, not interfere with, efforts to transition energy from fossil fuels and other polluting fuels to non-greenhouse gas-emitting technologies.

Policy Needs

Policy Solutions

Advancing engineered carbon removal technologies at a speed and scale responsive to the threat of climate change while also accounting for concerns related to environmental justice, local environmental impacts, transportation, and risk

Develop a clear, statewide strategy for engineered carbon removal

Governor or state legislature

Establish a single point of contact for engineered carbon removal policies and projects

A single point of contact could take one of several forms: an existing state agency or newly created agency; an interagency commission or working group; or an individual charged with integrating and guiding state efforts. Regardless of the form, the goal of the point of contact would be to ensure that state policies consider engineered carbon removal appropriately, oversee analysis and data collection, ensure inclusion of environmental justice concerns, and improve public communication. Overall, the point of contact would seek to improve efficiency and certainty.


Issue an executive order establishing the state’s commitment to engineered carbon removal technologies and establishing clear targets

Clear acknowledgement of carbon capture and sequestration and negative emissions technologies as critical components of California’s climate change goals could signal that these projects are top priorities for the state. Through an executive order, Governor Newsom could address the role of engineered carbon removal technologies in achieving California’s carbon neutrality goals and could increase ambition to reach net-negative emissions, not just net-zero emissions. An executive order establishing a specific goal for engineered carbon removal could help motivate efforts throughout the state.

State energy, air quality, and environmental planning agencies; legislature or executive direction

Develop a clear strategy regarding the role of engineered carbon removal in California’s broader climate change strategy

Carbon capture and sequestration deployment in the immediate near term can reduce emissions while paving the way for negative emissions technologies that need more time to reach commercial-scale deployment. The governor or legislature could increase the ambition of near-term goals (e.g., 2025 or 2030) on the pathway to 2045 carbon neutrality goals by addressing engineered carbon removal directly. Potential actions include: developing a statewide engineered carbon removal strategy that identifies how technologies will fit into California’s broader vision and goals, including climate change, environmental justice, economic goals; updating existing regulations, programs, and processes to account for engineered carbon removal technologies; and improving communication about existing and forthcoming state efforts, as several state agencies are engaged in planning by communication could be improved between these agencies and the public.

Ensuring consistency between projects and consideration of impacts

Create a coordinated, clear, and centralized permitting process

Governor and state legislature

Direct state agencies to coordinate and develop and centralized, master permitting process, considering environmental justice and other community concerns

A unified permitting process could help communities, project developers, and other stakeholders navigate the complex web of permitting authorities and ensure that projects receive proper attention and agency coordination. For example, the process could include a checklist and workflow process for a more efficient permitting process, integrated with federal and state financial incentives and their respective timelines. The single point of contact entity suggested above could oversee this process and coordinate between various permitting agencies. In addition, the point of contact could identify the necessary training and capacity building required at agencies for staff to learn more about these new technologies and the various modeling required to assess their impacts.

State and federal government agencies

Explore opportunities for memoranda of understanding/agreement to coordinate permitting and enforcement procedures

As an alternative to a unified permitting process—or perhaps in addition to one—state leaders could consider memoranda of understanding (MOU) or agreement (MOA) to develop concrete procedures for permitting coordination. MOUs and MOAs can assist agencies with planning and information-sharing to coordinate permits issued to the same projects while exercising their existing authority under state law. Such agreements could reduce delays in permitting processes while also increasing transparency and public engagement.

State agencies

Identify corridors and sites in advance that would be prime areas for engineered carbon removal facilities and associated infrastructure

Certain geologic sites and corridors may be particularly well suited for engineered carbon removal investments. Working with industry, affected communities and other stakeholders to help map these sites, agencies could conduct advance, pre-permitting review, while incorporating and analyzing land use impacts on disadvantaged communities and critical ecosystems. Developers could be encouraged, incentivized, or required to site projects in consensus, stakeholder-driven locations if the bulk of environmental permitting and land-use conflicts have already been addressed.

State legislature

Direct the Governor’s Office of Planning and Research to develop guidelines under the California Environmental Quality Act for permitting and lead agency guidance

Currently, stakeholders do not have clarity about which agency would lead CEQA review for engineered carbon removal projects. There is also a need to develop CEQA-related guidance for lead agencies overseeing assessments of engineered carbon removal projects.

State legislature

Clarify ownership of underground pore space for carbon storage

Pore space refers to the underground areas not occupied by solid matter, where injected carbon would be sequestered. California property rights currently create uncertainty about what entity or individual owns the rights to this underground space. This is of particular concern when different parties own the surface land and underground mineral rights.

State of California

Seek primacy status from the United States Environmental Protection Agency (U.S. EPA) for granting Underground Injection Control (UIC) Class VI permits

UIC Class VI permits are required for wells for carbon injection into deep rock formations, a crucial approach to ensure sequestration of carbon on a geologic timescale. Wyoming and North Dakota have obtained primacy from EPA, meaning that their state agencies now have primary enforcement responsibility in the process rather than the federal government, but EPA would still retail oversight and enforcement responsibilities if the state agencies failed to act adequately. By seeking state primacy, California could improve regulatory certainty for the injection well permitting process.

Addressing misunderstandings or lack of information about the need for and feasibility of various options

Support public awareness of engineered carbon removal needs and benefits

California Geologic Energy Management Division, Air Resources Board, Energy Commission, State Water Resources Control Board, Natural Resources Agency, Environmental Protection Agency, and Governor’s Office of Planning and Research

Host a series of community dialogues on engineered carbon removal

Dialogues could be hosted in partnership with third-party nonprofit organizations, universities, or other community partners. The goal of these events would be to increase understanding by answering questions, establishing a baseline understanding of the science and technology, and facilitating exchange of information. Dialogue is also needed to inform state agencies about communities’ specific concerns, so hosting events would provide a forum for this 2-way conversation. Topics covered could include, but would not be limited to: technologies in the context of climate change; specific pros and cons of different approaches; potential employment and job training opportunities; and potential risk mitigation and communication frameworks, among other issues.

State legislature

Direct the California Energy Commission, Geologic Energy Management Division, and/or State Lands Commission to sponsor one or more demonstration projects using new appropriations or cap-and-trade proceeds

Demonstration projects could help highlight the feasibility and potential benefits of various engineered carbon removal technologies. State-sponsored demonstration projects in Norway, Canada, and Illinois (funded by the U.S. Department of Energy) have been successful in proving technological and permitting feasibility, as well as identifying knowledge and regulatory gaps. Initial demonstration projects could be selected for their ability to support disadvantaged communities, such as through increasing job opportunities or reducing local air pollution. Recent studies have identified potential high-priority sites that could be logical candidates for early demonstrations.

California Energy Commission and California Air Resources Board

Develop and publish a state engineered carbon removal project opportunity map

Despite public perception, many engineered carbon removal technologies have nothing to do with coal plants or fossil fuel production, and can actually benefit air pollution in areas suffering from decades of injustice and public health issues. Some technologies, like direct air capture, are stand-alone projects—basically large fans that remove carbon dioxide from ambient air. Of course, there are risks with any technology and it is vital to address and understand risks so that decisions can be based on a holistic view of issues. One method to understand risks is a project opportunity map that identifies potentially feasible sites, projects currently planned or in development, the technologies they could use, and their anticipated emission benefits. Such a map could also include an analysis of potential local and regional benefits and risks. This map would help inform conversations throughout every phase of the planning process, including before specific projects are under consideration.

Financing projects requires planning and investment from businesses, outside investors, and others

Enable financial certainty to facilitate investment

California Air Resources Board

Extend annually-decreasing carbon intensity limits under the Low-Carbon Fuel Standard beyond 2030 and consider future program adjustments that could support carbon removal project financing

Carbon removal could play a key role in helping the state develop a zero-carbon transportation system, particularly if the state’s transition to electric vehicles is slower than hoped. But the support that the Low Carbon Fuel Standard crediting protocol provides to carbon removal project development is ultimately a secondary benefit of the program. The report proposes several recommendations that the state can adopt in the broader context of preserving the program’s effectiveness in reducing transportation fuel carbon intensity while having the secondary benefit of adding certainty for engineered carbon removal projects. While Air Resources Board leaders almost certainly plan to extend the Low Carbon Fuel Standard beyond 2030 by continuing to decrease the carbon intensity benchmark, particularly given the program’s substantial success in driving the state’s emission reductions, the lack of legal certainty on long-term credit value can limit creditor willingness to offer favorable financing for carbon removal projects.

California Energy Commission and Public Utilities Commission

Collaborate with the Geologic Energy Management Division, Air Resources Board, and other agencies to develop a coordinated approach to transitioning natural gas infrastructure to carbon transportation infrastructure

As part of the broader transition away from fossil fuels, communities, California is beginning the process of transitioning away from natural gas. Questions and concerns around pipeline infrastructure are relevant to both the natural gas transition and the development of carbon removal technologies. As a transition from natural gas leads to decommissioning of some pipeline infrastructure, there may be an opportunity to repurpose pipelines to transport carbon captured through engineered carbon removal projects. Coordination between agencies is required to ensure that decommissioning decisions are made in the context of engineered carbon removal potential.

United States Congress

Modify the 45Q tax credit to extend beyond the current 12-year duration and/or extend the construction deadline of January 1, 2024

Federal tax credits are available for engineered carbon removal projects. The exact value of the credit depends on the nature of the project. For example, saline and geologic storage projects receive a credit between $20 and $50 per ton of carbon stored. However, under current law the credit is available only to projects that commence construction before January 1, 2024, a deadline that may effectively exclude any projects that have not begun initial engineering design and permitting processes by the end of 2020. This cut-off date potentially excludes millions of tons of engineered carbon removal from projects that cannot commence construction in time despite overall viability. Congress could extend the 45Q eligibility deadline to ensure long-term credit availability and predictability for financing purposes.