The Next Economy
As DOE Invests $1.2B in Direct Air Capture, Climate Justice Groups Decry Business as Usual

As part of the Biden administration's Investing in America agenda, the US Department of Energy (DOE) recently announced up to $1.2 billion in funding for two direct air capture (DAC) hubs in Louisiana and Texas. The two regional DAC hub projects — South Texas DAC Hub and Project Cypress — will include infrastructure necessary to capture, process and permanently store carbon dioxide underground. Once running, the hubs are expected to collectively remove over two million metric tons of carbon dioxide from the atmosphere every year — the equivalent of taking nearly half a million cars off the road — and to create over 5,000 jobs.

“These hubs are going to prove out the potential of this game-changing technology, so that others can follow in our footsteps,” said Secretary of Energy Jennifer Granholm, in a press briefing made available to Sustainable Brands®. “If you deploy this at scale, this technology can help make serious headway toward our net-zero emissions goals while we are still focused on [deploying] more clean energy at the same time.”

DAC is a process that separates CO2 directly from the air. Captured CO2 can be used to make a growing range of products — from cleaning products, plastic and textiles to concrete and fuels — or pumped deep underground for permanent storage. Still in its infancy, the DAC industry will require massive funding to prove market viability and scale as an effective climate solution.

Investing in America earmarks $3.5 billion for creating four regional DAC hubs aimed at kickstarting a nationwide network of commercial-scale carbon-removal projects. Project Cypress, in Calcasieu Parish, LA, will be operated by nonprofit science and technology company Battelle in coordination with Heirloom Carbon Technologies and Zurich-based Climeworks Corporation. The South Texas DAC Hub (Kleberg County, TX) will be developed by a subsidiary of US oil and gas producer Occidental Petroleum.

The investment in these and other carbon-management projects is part of the larger Investing in America agenda — the Biden administration's economic strategy aimed at rebuilding a low carbon economy from the bottom-up and middle-out, not the top down. The funding was made available through the Bipartisan Infrastructure Act, which invests billions in infrastructure improvements and climate-resiliency projects.

Most experts agree that DAC is a necessary tool in mitigating the worst effects of climate change. However, it’s no panacea: DAC requires large amounts of energy to operate, and is less effective in mitigating climate change than real emissions reductions and other nature-based drawdown solutions.

Gov. John Bel Edwards (D) lauded DAC investments in his state, citing Louisiana as a prime candidate for developing zero-carbon technologies to remove industrial carbon pollution from the air. Louisiana, incidentally, is home to some of the most congested petrochemical buildout in the world, known colloquially as “Cancer Alley.” Gov Edwards stated he hopes DAC will play a role in mitigating emissions from the state’s massive petrochemical sector.

But groups including the Climate Justice Alliance (CJA) oppose the buildout of any infrastructure that could serve to perpetuate further petrochemical operation, which often disproportionately harms communities where they are built. A joint statement released by CJA’s Marion Gee and Basav Sen, Climate Justice Policy Director at the Institute for Policy Studies, decried the DOE announcement:

“Direct air capture allows polluting industries to live on when we should be focusing on a just transition to renewables,” Gee wrote. “In an effort to move quickly and carelessly to balance a ‘carbon budget,’ the backyards that he’s talking about building in … [will] be Black folks, Indigenous communities and poor BIPOC neighbors — sacrificed, yet again in the name of protecting corporate interests."

CJA argues DAC is a red herring pushed by the fossil fuel industry and its political backers designed to distract from the real solution — phasing out fossil fuels.

“Anything else is just smoke and mirrors,” Sen asserted. “The Biden administration should stop their cynical political game of squandering public funds on unproven, expensive and potentially dangerous schemes such as direct air capture — purportedly to gain credibility for backing climate solutions, while doubling down on expanding fossil fuels."

Office of Clean Energy Demonstrations Deputy Director Kelly Cummins said that neither of the hubs will use captured CO2 for enhanced oil recovery — a significant departure from current carbon-management practices. Cummins said community and stakeholder engagement represented 20 percent of the decision-making process to go ahead with these plants; and a mandatory community development fund has been established to help meet the administration’s goal of 40 percent of clean energy investments going to underserved communities most impacted by climate change.

Battelle will purchase clean power offsets for Project Cypress, though Batelle President and CEO Lou Von Thaer admitted in the press briefing that the focus of the project is technology demonstration. Occidental President and CEO Vicki Hollub said the Texas project will be powered directly by solar.

When asked during the briefing if the hubs will sell carbon credits, Cummins replied: “What we’re really focused on for these DAC hub projects is making sure that the technology can scale at the commercial level … We want to make sure that these companies and these projects are financially viable in the long term, so we are not restricting revenue sources.”

DOE hopes these moves will further scale what it calls “responsible carbon management” across the US. In addition to funding four carbon-removal hubs, DOE will fund early-stage efforts to explore the feasibility of an additional 19 DAC hub projects; though these projects may not receive DOE funding nor even break ground.

DOE expects solicitation for additional hubs in 2024.