The Department of Energy (DOE) intends to issue a Funding Opportunity Announcement (FOA) for carbon dioxide transportation infrastructure finance and innovation (CIFIA) Future Growth Grants (FGG). The FOA is anticipated to be issued in the first quarter of Fiscal Year 2024 and will be funded by the Bipartisan Infrastructure Law (BIL). Section 40304 of the BIL authorizes a total of $2.1 billion for the five-year period encompassing fiscal years (FYs) 2022 through 2026 for the CIFIA program. CIFIA will support shared infrastructure projects, including pipelines, rail transport, ships and barges, and ground shipping, that connect anthropogenic sources of carbon dioxide with endpoints for its storage or utilization. Carbon management technologies such as carbon capture from industry and power generation, direct air capture, carbon conversion, and CO2 transportation and storage technologies must be deployed at a large scale in the coming decades to meet the United States’ net-zero greenhouse gas goals by 2050.

Investments to finance projects that build shared transport infrastructure to move CO2 from points of capture to utilization facilities and storage wells will help form a domestic interconnected carbon management ecosystem. Robust investments will be required to overcome barriers associated with deploying large common carrier CO2 transport infrastructure, including high capital costs and uncertain near-term utilization and returns as demand comes online.

The CIFIA legislation authorizes FGG to pay a portion of the cost differential with respect to a projected and probable future increase in demand for CO2 transportation by a large-capacity, common carrier infrastructure project. The cost differential is defined as the difference between:

1. the cost of constructing the infrastructure asset with the capacity to transport an increased flow rate of CO2, as made practicable under the project; and
2. the cost of constructing the infrastructure asset with the capacity to transport CO2 at the flow rate initially required, based on commitments for the use of the asset.

TECHNICAL OBJECTIVES

FGG are intended to provide financial assistance for developing and building CO2 transport capacity that is reasonably likely to become available when CO2 suppliers such as carbon capture and direct air capture (DAC) facilities come online and/or when CO2 sinks such as CO2 storage or utilization facilities come online but has capacity that may not be contracted or utilized in the initial years of operation of the CO2 transport system. Significant economies of scale can be achieved if additional up-front investments are made to “oversize” CO2 transport infrastructure capacity to accommodate potential CO2 supplies that are not yet under contract. However, financing for CO2 transport infrastructure investments is often difficult or impossible to obtain unless firm contractual commitments are in place for both CO2 supply and offtake.

Investments in additional capacity provided by FGG could help avoid future construction of additional transport infrastructure (e.g., separate redundant transport networks) and associated environmental impacts. Also, the additional transport capacity made available under FGG may incentivize CO2 emitters to make the capital investments required to capture CO2 at their facilities by providing assurance that the captured CO2 can be moved safely and reliably to geologic storage or other end-use locations.

The FOA, if issued, would require Applicants to describe:

• a Base Project consisting of large-capacity, common carrier infrastructure that would transport quantities of anthropogenic and/or ambient air CO2 for which firm commercial contractual commitments are in place for CO2 supply and offtake; and
• an Expanded Project consisting of a large-capacity, common carrier infrastructure with the capacity to transport an increased flow rate of CO2 compared to the Base Project.

CO2 transport systems described in the Base and Expanded projects must comprise a transport network that is physically connected by way of pipeline, rail, road, and/or body of water. Applicants may propose projects that use one or multiple modes of CO2 transport infrastructure (e.g., pipelines, rail, truck, barge, and ship). Existing infrastructure that is currently transporting CO2 does not qualify as a Base Project; however, repurposing existing infrastructure for CO2 service does qualify as a Base Project.