The climate crisis is an issue that is not going away. North Dakota’s lignite coal-fired plants emit millions of tons of the heat-trapping gas carbon dioxide, or C02, into the atmosphere. The social and political pressure is putting the future of North Dakota’s lignite coal production on the line.
In our first segment of “The Case For Coal,” Josh Meny explores a new technology that could allow coal-fired plants to continue doing business while also capturing carbon emissions. Critics say this new technology is a costly distraction, that’s not worth the financial risk, and is moving North Dakota in the wrong direction.
“I think we need to move that way or we’re going to be shut down,” says Republican Senate Majority Leader Rich Wardner.
Carbon Capture and Sequestration is the process of capturing carbon dioxide from coal-fired plants and storing it permanently underground so that it is not emitted into the atmosphere.
State legislators are so convinced that carbon capture or sequestration is a win-win for North Dakota’s lignite industry they are proposing $50 million dollars into R&D for the technology in the state bonding package.
“This is really a wake up call for all of us that we need to make sure that we take the carbon out, it’s just a part of life going forward. If we don’t do it we will have no coal fired plants in this state 15 20 years later,” explained Wardner.
Right Now Blue Flint Ethanol Refinery near Underwood is in the process of completing their $7.5 million dollar carbon capture and sequestration well, which will capture their 200,000 tons of C02 per year effectively making them a carbon zero facility.
Blue Flint is already making great strides towards carbon neautral by taking steam from Coal Creek Station and turning it into thermal energy that they use to power the conversion of corn into ethanol. When the well is complete, the C02 emisssions will be transported about two miles away at a carbon capture well where it will be injected about 4,200 feet into the ground and stored permanently.
The groundwork for carbon capture and sequestration began twelve years ago when now Senator John Hoeven was then Governor Hoeven.
“We actually passed legislation in 2009 after we set up a task force in 2008 so that we have the legal and regulatory structure to do something like 45Q, or I should say to capture and sequester C02, and do it safely and makesure it’s sound for the long term. That’s really important because now that we have passed 45Q, we’re one of the only two states in the country that can actually do it, so it’s been more than 12 years in the making,” explained Republican U.S. Senator for North Dakota John Hoeven.
45Q is the federal tax credit which is the financial driver for these projects. It’s 50 dollars per ton of C02 sequestered. It will allow power companies to pay back the upfront cost of retro-fitting their coal fired stations to do carbon capture and squestration.
“You’re talking probably hundreds of millions to put that technology in place and so those loan guarentees are going to be very important for them to pay the cost to do it, and then they get a very good payback on that at 50 dollars a ton at every ton of C02 they produce and sequester,” said Hoeven.
Project Tundra is an initiative by Minnkota Power Cooperative to build the world’s largest carbon capture facility at the Milton R. Young Station in Center, ND.
“We’re proposing to capture 4 million tons of C02 every year. Just to give some context around the magnitude of the carbon dioxide capatured, that is the equivalent of taking every pickup truck, and every truck, every passenger vehicle regerstered in North Dakota off the road,” explained Minnkota Power Cooperativesenior Manager of External Affairs Stacey Dahl.
Sonja Kaye is running for the Board of Directors of Cass County Electric Cooperative which takes power from MinnKota. She’s a critic of the Project Tundra saying the technology is a costly distraction.
“Let’s talk about the exorbitant price of project Tundra. We have already unwisely sunk about $46 million into research and development of this project. The project is still estimated to cost another $2 billion. Economists believe costs could run even higher So far, the project has not attracted an investor because the project is, in the words of Minnkota, “expensive” complex” and “risk intensive.” It relies on huge tax credits. Tax credits are worth more than the energy itself,” said Kaye.
Kaye says there are only two other carbon capture and sequester projects in the world and they have both been financially unsuccessful. According to the the Institute for Energy Ecomics and Financial Analysis (IEEFA), they are in Boundry Dam Unit 3 in Saskatchewan, Canada, and Petra Nova near Houston, Texas, Kaye adds that Minnkota is wagering their bet that the technology works on the backs of the consumer.
“And what do we get for the money. Well, the customers in northeast ND and northwest Minnesota get really inefficient electricity that will cost them a significant rate increase if the project fails to meet the requirements of the tax credits,” said Kaye.
Stacey Dahl tells KX News that because Minnkota is a not for profit cooperative they cannot leverage the 45Q federal tax credits themself. So, they are currently in the process of forming tax equity partnerships with private entities who can utilize the tax credits to leverage for the capitol needed for the project.
Tune into the second edition of the Case For Coal Monday February 8th on KX News at 10.
Josh Meny will be diving further into carbon capture and sequestration, and how industry leaders and lawmakers are considering the technology a crucial piece of keeping Coal Creek Station running.
“It looks like there is someone that is very interested in taking over that plant and running it and a part of that will be the sequestering of the C02,” explained Wardner.