Carbon Capture and Storage Projects Create New Infrastructure Demand
CCS projects are creating major infrastructure demand with $85/tonne tax credits driving pipeline development and geological storage site acquisitions across the Midwest and Gulf Coast.
Carbon capture and storage (CCS) projects are creating new demand for industrial infrastructure, pipelines, and geological storage sites across the United States. Enhanced by the IRA's expansion of the 45Q tax credit — now offering $85 per tonne for geological storage and $60 per tonne for enhanced oil recovery — CCS project announcements have surged.
The pipeline infrastructure required for CCS is substantial. Navigator CO2 Ventures proposed a 1,300-mile pipeline network across five Midwestern states to transport captured CO2 from ethanol plants to geological storage sites. Summit Carbon Solutions is developing a similar 2,000-mile network. These projects require extensive right-of-way acquisitions across agricultural land, creating both opportunities and controversies for rural landowners.
Geological storage sites — typically deep saline formations capable of permanently sequestering CO2 — are becoming valuable assets. Companies including Battelle, Occidental Petroleum, and 1PointFive are securing pore space rights in formations with suitable geology. The Gulf Coast's extensive saline formations and existing geological knowledge from decades of oil and gas exploration make it a prime area for CO2 storage.
For landowners, CCS pipeline easements can provide annual payments of $10-$50 per rod (16.5 feet) of pipeline crossing their property, with additional payments for surface facilities. Subsurface pore space leases for CO2 injection and storage represent a newer revenue opportunity, with lease terms still being established as the industry develops.
The integration of CCS with direct air capture (DAC) technology adds another dimension. The DOE's DAC Hub program has awarded funding for facilities that will capture CO2 directly from the atmosphere, requiring both significant energy supply and nearby geological storage. These facilities favor locations with abundant renewable energy and suitable geology.