Enhanced oil recovery has no place in the Regional DAC Hubs program
Direct air capture helps us clean up CO2 in the atmosphere — not increase oil production
By Erin Burns, executive director
The Regional Direct Air Capture (DAC) Hubs program will be the first megaton scale deployment of carbon removal in the world, representing a 400x increase in DAC capacity. It is an immense opportunity to deploy DAC not only quickly but responsibly — but opportunity doesn’t determine outcome.
The program’s first funding opportunity announcement (FOA) was published at the tail end of 2022, and since then we’ve pored over the text and compiled our analysis. The Department of Energy’s (DOE) commitment to removing legacy emissions, approach to hub ownership, and inclusive structure for DAC technologies at various stages of maturity align with our recommendations. One particular part of the FOA, however, does not: the inclusion of enhanced oil recovery (EOR).
Despite advocacy from Carbon180 and others, EOR is eligible to receive federal funds through this program. We believe that the Regional DAC Hubs program should not provide support for continued fossil fuel extraction and use. As the foundation of the DAC industry, these hubs should address legacy emissions and center environmental justice (EJ) principles.
What is EOR?
EOR is a process where CO2 is pumped into oil reservoirs to, well, produce more oil. Right now, EOR accounts for about 2% to 5% of US oil production and virtually all of it uses CO2 mined from naturally occurring geologic formations, not CO2 captured by DAC (or point source carbon capture).
In theory, EOR using CO2 from DAC could result in oil that has a lower carbon footprint than traditional oil. Some in the climate space support EOR because of that opportunity for lower emissions oil, as well as the fact that revenue from selling captured CO2 could bring DAC down the cost curve.
The Carbon180 perspective
We’ve grappled with the role that EOR and oil companies more largely should play in carbon removal since our founding in 2015 and our perspective has evolved. Carbon removal will (and should) only be successful if it’s deployed in ways that are equitable and just, in places that want to host projects, and with benefits that flow to host communities. For many EJ groups and Carbon180, that vision is antithetical to sustaining fossil fuel infrastructure, including EOR.
With that in mind, we launched our environmental justice initiative more than two years ago because we believe that communities should play a determining role in carbon removal projects and that federal policy can be a tool for an equitable and just carbon removal sector.
How we build equitable, durable hubs
The infrastructure, policy, and trust we build today will last decades.
Projects stood up through policies like the DAC Hubs program will be around for a long time: the majority of US electricity infrastructure in use today, for example, is more than 25 years old. Almost half of US bridges are at least 50 years old, and US dams average 57 years old. We could go on. It takes time to build infrastructure and what we build stays around, impacting nearby communities and the environment.
The policy we pass today is also foundational in the US and globally. Carbon removal is fundamentally different from decarbonization approaches like renewables: it doesn’t create a product that can be sold for profit. No matter how cheap we make it, it’s always going to be a public good and, therefore, it’s always going to rely on public policy. That’s why we need efforts like the DAC Hubs program and why the projects it funds are so influential.
To secure long-term policy, we also need durable political coalitions in Congress. Right now, carbon removal is bipartisan, with members across the aisle supporting pathways for different reasons. But if policymakers support DAC because they support EOR, we’re in trouble, because EOR is not here for the long run. With the hubs, we have an opportunity to showcase the full range of benefits that come from carbon removal if we untangle — rather than further enmesh — carbon removal and fossil fuels.
Finally, success will be inherently tied up in public trust and perception. The Hubs program will introduce many people to DAC for the first time: polling shows that Americans are still forming opinions about this suite of technologies but support government leadership in cleaning up legacy emissions. Opening the door for this technology to be tied up with EOR creates associations with greenwashing and barriers to trust-building.
The point of DAC is not to increase oil production — the point is to clean up CO2 we’ve already put into the atmosphere.
The possibility of enhanced oil recovery funded through this program is not what we wanted, and is antithetical to the potential of DAC and a poor use of taxpayer dollars.
A close reading of the FOA
The FOA is 254 pages and includes provisions that have significant implications for the role of EOR in DAC hubs — now and in the future. We’ve broken down what we do (and don’t!) know below.
- Lifecycle assessments will shape project selection, favoring greatest net-removals. Projects with the greatest long-term net carbon emissions reduction will receive preference in final selections, per the FOA. To measure this, each applicant will submit a cradle-to-grave lifecycle analysis (LCA), detailing what happens to the CO2 once it’s removed from the atmosphere and any associated environmental impacts. It looks like those LCAs could include the end use of oil produced with EOR (page 13 of the FOA, for those following along at home), potentially making it more difficult for DAC-to-EOR projects to prove the greatest long-term reductions. But there’s room for interpretation here. The LCA could instead include the CO2 removed from the atmosphere and placed into geologic storage, regardless of what happens to the barrel of oil outside of the hub. DOE can provide additional clarity here, and ensure that emissions from continued fossil extraction are accurately accounted for.
- Community Benefit Plans (CBPs) bring community-level input to the forefront of applications. Each applicant will turn in a CBP, which prioritizes two-way engagement and consultation of communities surrounding a prospective hub site, giving them a potentially determining influence over if, where, and how projects are developed. — including the role of EOR. Capturing everything from a Justice40 Initiative evaluation to an overview of engagement methods, these plans can help determine whether a community would benefit from a DAC hub. The inclusion of EOR could complicate public trust-building if communities view these projects as a license to continue polluting in low-income communities (rather than an approach to climate change with robust economic and environmental benefits).
- Administrative turnover will have bearing on how DAC hubs are implemented. The Biden administration has invested deeply in carbon removal — we’ve seen legacy emissions named in the president’s budget, a renewed vision for the Office of Fossil Energy and Carbon Management, a newly established Carbon Dioxide Removal Program at DOE, and appropriations dedicated to RD&D across the portfolio of carbon removal solutions. Given the amount of time it will take to stand up this program, break ground on four DAC projects, and scale them up, it’s possible that another administration will write and manage FOAs that could open the door to more EOR projects.
Today, we have the privilege of being at the very beginning of what we believe will become a massive industry. As a field — across policymakers, developers, and communities — we can make decisions about what that industry will look like and who will benefit from it, with impacts felt through 2035 and 2050.
With the first-ever multi-billion dollar, multi-megaton effort on carbon removal, we can build the foundation for an equitable and just sector that helps us meet climate goals and moves us away from fossil fuels. And the urgency of climate change demands we build the market we want to see from the start.
The possibility of enhanced oil recovery funded through this program is not what we wanted, and is antithetical to the potential of DAC and a poor use of taxpayer dollars. DOE should deprioritize applications linked to EOR and stay laser-focused on those that deliver the greatest environmental justice and lifecycle emissions benefits.
The vision that Carbon180 and our partners stand behind is one where carbon removal is a tool for justice, redressing past harms with durable and equitable policy, regulations, and implementation. Coupled with rapid emissions reductions, carbon removal is an essential piece of addressing climate change. We’re committed to ensuring it’s done right in order to create a livable climate in which current and future generations can thrive.
Read about the core beliefs that drive our work.
Edited by Dana Jacobs.