While the climate report warns of growth in the fossil fuel industry, Louisiana has several projects on the way

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To meet global climate goals, construction of new fossil fuel infrastructure without a way to remove its carbon emissions must halt worldwide, including in Louisiana where several plants are planned.

That was one of the main messages of the latest international climate change report, published on April 4th.

Earlier this year, Louisiana became the first Deep South state with a plan to reduce its carbon footprint. However, while Gov. John Bel Edwards is committed to a clean future, it remains unclear how and when the state will handle the influx of an additional 101 million tons of emissions from future industrial projects already approved.

To put that number in perspective, Louisiana is already responsible for a relatively large amount of CO2 emissions relative to its population. It is fifth in the nation for emissions per capita. According to Louisiana State University, the state emitted 216 million tons in 2018 Greenhouse gas inventory 2021.

Two-thirds of this already comes from the industrial sector, which is widely considered to be the most difficult sector to decarbonize. If all approved projects go ahead, total industrial emissions could potentially increase to 242 million tons.

In the report of the Intergovernmental Panel on Climate Change, the authors said that the emission reduction tools needed by Louisiana industry are already available and operational, but the vast majority of these proposed projects have no plans to eliminate or even reducing their effect.

“‘It’s a global problem and it has to happen,’ said Jae Edmonds, one of the lead authors of the IPCC’s April report. “You can’t unhook any major economy in the world, and you can’t unhook any sector. They all have to go to zero.”

Edmonds said the longer companies and governments wait, the longer it will take the world to reach zero emissions and limit global warming. Previous climate reports warn that further warming could have dire effects on the Louisiana coast.

The financial risks

But turning to those plans is easier said than done, according to industry officials, who said the economic risk is preventing more companies from investing in the technologies needed to significantly reduce emissions.

In the industrial sector, Edmonds and other researchers said big emissions reductions will require a combination of things: increasing energy efficiency, electrifying operations, switching from fossil fuels to another heat source, and offsetting remaining emissions.

Industry advocates have focused on the possibility of offsetting emissions. This can be done with nature, restoring habitats such as trees that sequester carbon, or with existing technology known as carbon capture and storage, which is being advanced by industry as a critical tool to reduce its impact through technology.

But even that hasn’t been implemented on a large scale on a commercial scale, and companies are slow to implement their own plans to build carbon scrubbers.

Nathan McBride, the regulations manager for the Louisiana Mid-Continent Oil and Gas Association, said that’s because building the infrastructure to start carbon capture is expensive and there’s simply no economic incentive for companies to store it.

“To make this investment profitable, there has to be some kind of return. It doesn’t have to be a huge return, but there has to be some kind of return for companies to stay in business,” McBride said.

For McBride, that means increasing the value of the federal tax credit available to businesses, known as the 45Q tax credit, for each ton. He would also like to see more governments help build infrastructure, such as pipelines to transport the CO2, which costs hundreds of millions of dollars and makes start-up costs high.

However, not all investments are so risky. Making industrial plants more efficient would reduce consumption and save energy costs in the long term and provide an economic incentive. However, McBride said that kind of progress is still slow in Louisiana.

“Energy efficiency is something that I know a lot of our facilities place a lot of emphasis on,” he said. “It just takes time. … They make too many changes up front, which can have a negative impact on costs (for customers).”

Current proposals in Louisiana

New plants don’t have to submit energy efficiency plans or emission reduction plans during the permitting process, so most don’t have one.

However, LSU professor David Dismukes expects that future projects will face increasing pressure to reduce emissions. He is the executive director of the university’s Center for Energy Studies and is also the author of the state’s greenhouse gas inventory.

That started last year with the high-profile announcement of a new $4.5 billion blue hydrogen facility in Ascension Parish, which is expected to come online in 2026.

Announcing Blue Hydrogen from Air Products

Louisiana Gov. John Bel Edwards (right) looks on as Air Products CEO Seifi Ghasemi (left) delivers remarks on the company’s newly announced plan to build, own and operate a blue hydrogen clean energy complex in Louisiana March 10 October 2021 makes.

Air Products’ facility would produce hydrogen using natural gas as a feedstock and would rely on carbon capture and storage to capture 90% of its emissions. Other plants could then use this lower-carbon hydrogen to begin reducing their own use of pure fossil fuels.

“There has been a huge surge of interest in these areas from industry people and others that just didn’t exist a few years ago,” Dismukes said.

But Air Products may be the only proposed facility that meets the IPCC report’s threshold for meaningful reductions in emissions, which said projects should offset or capture 90% or more. Most project proposals in Louisiana do not meet the same standard.

For example, Venture Global, an exporter of liquefied natural gas, announced plans for extraction last May a total of 1 million tons of carbon per year from its three planned terminals in south Louisiana.

But overall, these terminals – dubbed “carbon bombs” by climate activists – are expected to emit up to 20.5 million tons of greenhouse gases annually. This means it may only capture 5% of total emissions.

“We have to step up our game a little,” said Dismukes.

‘The wrong direction’

Green and renewable energy advocates like Logan Burke are not so confident that companies will adjust their own plans to include carbon reduction measures. While some in the Louisiana legislature want it prevent government agencies Regarding the regulation of greenhouse gas emissions, she said that was “the wrong direction”.

Instead, Burke, the director of the Alliance for Affordable Energy, argued that Louisiana should stop welcoming new industrial projects and make greenhouse gas impact assessments part of the permitting process.

“If a new facility is to come to Louisiana, the very first question the Louisiana government must ask is, ‘Can this be a zero-greenhouse gas facility?’ And then the responsibility lies with this industrial facility to achieve that,” she said.

Burke pointed out that much of the energy already derived from fossil fuels in most sectors goes unused. In 2021, the Lawrence Livermore National Laboratory estimated this just over half the energy that is produced in industry ends up in the garbage.

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Lawrence Livermore National Laboratory

“That means we’re wasting fossil fuels in a way that suggests we certainly shouldn’t be pulling more of it out of the ground,” she said.

In the past, Sierra Club organizer Darryl Malek-Wiley said Louisiana regulators have focused on whether a permit meets federal standards, rather than considering the “moral imperative” of reducing carbon emissions.

“We have this policy that we want to go net zero by 2050,” he said. “Where are the legal conditions to force companies to make investments in this direction? We miss that.”

At the moment, while information is being collected on projected greenhouse gas emissions, it will not affect whether a permit will be granted, he said.

Louisiana’s Climate Action Plan calls for the Department of Environmental Quality and the Department of Natural Resources to develop a net-zero industry standard and industrial efficiency standards to set rules for facilities. Industry groups also opposed both measures, arguing that the transition should be driven by market forces, not regulations.

The governor’s office is still evaluating the extent to which existing agencies can be used to implement the plan, said Harry Vorhoff, deputy director of the Louisiana governor’s office of coastal activities.

If the creation of such standards does not fall into the executive branch, it may require approval from the largely pro-industry Louisiana legislature.

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