NIMBYism in the Midwest
PLUS: Australian renewables, Williams hydrogen, Veriten's $85mm fund, Qatar-Shell LNG, General Mills-Walmart agriculture
Environmentalists and landowners are opposing plans for CO2 pipelines in the Midwest.
These pipelines are crucial for the Administration's emissions reduction plans, but critics question their green credentials, safety, and use of eminent domain.
Regulators in North and South Dakota rejected permit applications due to local opposition, causing uncertainty for the multibillion-dollar projects.
The challenges are reminiscent of those faced by crude oil pipelines like Keystone XL and the Dakota Access Pipeline.
To achieve net-zero emissions by 2050, the U.S. needs to build about 60,000 miles of CO2 pipelines, but only about 5,300 miles exist today.
Opponents argue that carbon capture delays the transition to green energy and benefits the fossil fuel industry.
Tax subsidies make capturing CO2 attractive for companies, but they face obstacles such as easement negotiations and complex regulations.
Some believe federal government authority should be granted for CO2 pipeline approval.
While renewable energy projects also face opposition, regions like the Gulf Coast may be more favorable to CO2 pipelines.
Summit Carbon Solutions' plan to gather and bury carbon emissions from ethanol plants faced denials in North and South Dakota.
Farmers argue against eminent domain for CO2 pipelines, as they carry waste for pipeline companies, not essential commodities.
Storing CO2 can benefit ethanol producers by qualifying them for federal tax credits and expanding markets.
Poet has agreements for waste capture, but projects face opposition in Illinois and South Dakota.
Counties along Navigator's route in Illinois have imposed moratoria on CO2 pipelines.
Landowners express concerns about pipeline safety and insufficient research.
Some residents reject offers from pipeline companies for CO2 storage rights.
Opposition to CO2 pipelines includes concerns about disrupting communities and water resources.
Commentary below only visible to those who have completed the Gentleman’s Agreement / Ladies Understanding (at least one referral see details at bottom of your email).
Everyone expected an uphill battle on economics, locking down emitters and receiving EPA permits.
To see the sheer amount of opposition from both the far right and far left when it comes to right of way and state-level permits was somewhat surprising.
It’s becoming a persistent issue on any infrastructure buildout in the US.
The pre-FID capital to ultimately generate infrastructure or target mid-teen style returns feels tough when T-bills are 5%. That said I’m sure this the same thing folks said when Shale 1.0 infrastructure was being debated.
We saw publicly the Navigator CO2 project on pause. We’ll see if the rumor mill on Navigator’s pause being a shut-down ends up true. It’s not great for the industry but perhaps positive for Summit.
Here’s the hot take - Ultimately, those who end up getting to the finish-line in the next few years are going to be in the carbon monopoly business.
The open-ended nature of the IRA’s 12 year credit timeline means regulators will be making a decision here near the turn of the decade. When they do, history would tell you it’s inevitable that incumbents will win and startups will face a litany of difficulty to join the game.
Australia's third-largest pension fund, Aware Super, plans to invest up to $1.3 billion (A$2 billion) in smaller-scale solar and battery installations.
They have partnered with Birdwood Energy, with an initial investment of $391 million (A$300 million), and this investment could grow to $1.3 billion as more projects become ready for financing.
The focus of these investments is on distributed renewable energy projects, including clusters of solar panels paired with batteries.
This initiative aims to diversify Aware Super's portfolio, which currently includes larger-scale wind and solar projects.
Australia is transitioning its electricity grid from reliance on large coal or gas plants to smaller clusters of wind and solar generation.
Birdwood Energy intends to invest in projects ranging from 30 to 100 megawatts, with a focus on smaller-scale ventures.
The goal is to accelerate the country's transition to net-zero emissions, with early investments including two solar farms with batteries and 10 more projects in the pipeline.
Qatar has secured a 27-year gas supply agreement with Shell in the Netherlands, following a similar deal with TotalEnergies for France.
These deals are part of Qatar's efforts to help Europe replace lost Russian gas supplies, which were restricted due to EU sanctions in response to Russia's invasion of Ukraine.
QatarEnergy and Shell have agreed to supply 3.5 million tonnes of LNG per year for 27 years, reaffirming Qatar's commitment to meet Europe's energy demands and enhance energy security.
However, such long-term supply deals may conflict with EU goals to achieve net-zero emissions by 2050.
European buyers have signed several long-term LNG supply contracts with Qatar as part of its two-phase expansion plan, which will significantly increase liquefaction capacity by 2027.
The gas market remains tight, with limited supply, and prices could rise if further disruptions occur or if harsh winter weather affects Europe or North East Asia.
Williams has been selected by the U.S. Department of Energy (DOE) to participate in two hydrogen hubs.
The hubs are located in the Pacific Northwest and Appalachia and have been chosen for investment and development.
Williams, as an energy infrastructure provider, is committed to advancing the development of a clean hydrogen economy.
The DOE's Regional Clean Hydrogen Hubs Program received 79 applications, with seven selected to receive $7 billion in funding.
Williams is part of two selected hubs: the Pacific Northwest Hydrogen Hub and the Appalachian Regional Clean Hydrogen Hub.
The Pacific Northwest Hydrogen Hub aims to reduce emissions in sectors like transportation, energy storage, ports, agriculture, and industry.
Williams plans to build hydrogen pipelines to transport clean hydrogen and support decarbonization efforts.
The Appalachian Clean Hydrogen Hub will use low-cost natural gas to produce low-cost clean hydrogen and store carbon emissions.
It will involve hydrogen pipelines, fueling stations, and CO2 storage to lower the cost of hydrogen distribution and storage.
Williams will leverage its presence in the region to contribute to these hydrogen hub initiatives.
NovoHydrogen secures a $20 million equity commitment from Modern Energy.
This investment is aimed at accelerating green hydrogen development in North America.
NovoHydrogen, based in Colorado, focuses on green hydrogen projects.
The global hydrogen industry, while significant, relies heavily on fossil fuel feedstocks, posing decarbonization challenges.
NovoHydrogen plans to use the capital to strengthen its team and advance green hydrogen projects to the construction stage.
They had previously raised $3.5 million in initial seed funding and formed a strategic partnership with Ohmium, a PEM electrolyzer manufacturer.
Green hydrogen, produced through clean electrolysis, is a versatile, emission-free fuel with potential in sectors like heavy industry, power generation, and transportation.
There is regulatory support for green hydrogen in the United States, including tax credits and funding for clean hydrogen hub development.
NovoHydrogen is part of the Pacific Northwest Hydrogen Hub and is negotiating for site development.
Veriten has successfully closed its inaugural fund, NexTen LP, with $85 million in committed capital.
NexTen aims to identify and support reliable, sustainable, scalable, and economically viable solutions in the evolving energy landscape.
Participants in the NexTen fund include select energy companies, financial institutions, energy professionals, family offices, and Veriten team members.
Veriten, founded in 2022, partners with corporate and financial clients across various industries, providing custom research and strategic advice related to energy, power, mining, industrial, and technology sectors.
The NexTen fund leverages Veriten's extensive network and expertise to invest in private companies focused on long-term energy solutions.
Veriten's leadership team includes Maynard Holt, Co-Founder and former CEO of Tudor, Pickering, Holt & Co. (TPH), along with industry veterans Jeff Tillery, Arjun Murti, Mike Bradley, and Todd Scruggs.
The fund's current investments include companies like Amperon, Emrgy, Mesa Natural Gas Solutions, Orbital Sidekick, and Orennia, covering a range of energy-related sectors.
Veriten is committed to providing thought leadership through various platforms such as its weekly "Close of Business Tuesday" podcast and "Super-Spiked" energy editorial.
The firm's commercial efforts involve partnering with energy companies and offering strategic insights and advice.
The addition of the NexTen fund to Veriten's platform enhances its ability to evaluate long-term commercial opportunities and invest capital in alignment with its energy outlook.
The firm's mission is to provide valuable information and facilitate better energy choices for companies, the country, and the world.
General Mills, Walmart, and Sam's Club collaborate to promote regenerative agriculture on 600,000 acres in the U.S. by 2030.
These acres are where General Mills sources ingredients for products sold at Walmart and Sam's Club.
Initial projects receive support through grants from the National Fish and Wildlife Foundation (NFWF).
The collaboration aims to improve soil health, water quality, and carbon sequestration.
Targeted crops include wheat in the Northern and Southern Great Plains.
The effort involves seven U.S. states: North Dakota, South Dakota, Nebraska, Kansas, Oklahoma, Colorado, and Minnesota.
NFWF will provide financial assistance to local organizations for education and coaching to accelerate regenerative agriculture.
The goals include transitioning to regenerative agriculture, improving soil health, biodiversity, climate change mitigation, and economic resilience for farmers.
The collaboration aligns with sustainability goals for both companies and offers a roadmap for future industry collaborations.
General Mills aims to advance regenerative agriculture on 1 million acres by 2030, and Walmart has a goal to protect and sustainably manage 50 million acres of land by 2030.
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