A Merchant Take On The Carbon Dioxide Industry
Summary
Today, pipeline sequestration companies are looking to take CO2 from ethanol and other large (concentrated) CO2 emitters, such as anhydrous ammonia plants, and sequester into deep geologic formations. The CO2 industry is increasingly focused on various forms of sequestration, the first being EOR—with a number of new projects under evaluation or already in development—subsidized by the enhanced tax credits precipitated by both 45Q and the Inflation Reduction Act. Of course, applications such as using the thermal value of CO2 off an ethanol plant, along with the high-content CO2 (generally over 99 percent (v) off the fermenters) as a partial solution for CO2 usage adjacent to greenhouses is an excellent form of sequestration. Ethanol is the most important source type for a good-quality, highly concentrated form of CO2 feedstock for liquefaction/purification, and it serves an impressively large and diverse marketplace. Within the CO2 industry there is a level of concern that merchant supplies from the large sources in places such as the Midwest, Mid-South and Southwest may be challenged by federal tax incentives including 45Q and the IRA, in particular.