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Climate change

The US agency in charge of developing fossil fuels has a new job: cleaning them up

The Office of Fossil Energy and Carbon Management has a new name, new leaders, and a new mandate to meet Joe Biden’s climate goals.

September 2, 2022
Petra Nova plant at magic hour with train in foreground
The Department of Energy-supported Petro Nova project in Texas was the world’s largest coal plant equipped with carbon dioxide capture equipment. It prevented millions of tons of emissions, but was shuttered in 2020.NRG

In his first month in office, US President Joe Biden signed an executive order calling for the nation to eliminate carbon pollution from the electricity sector by 2035 and achieve net-zero emissions across the economy by 2050. 

That move redefined the mandate of the US Department of Energy’s Office of Fossil Energy, the research agency whose mission has been to develop more effective ways of producing fossil fuels for almost half a century.

Now it’s responsible for helping to clean up the industry. 

In July the agency, which has about 600 employees and a roughly $900 million budget, added “and Carbon Management” to its name, signaling a major part of its new mission: to help develop the technology and build an industry that can prevent the release of carbon dioxide from power plants and factories, suck it out of the air, transport it, and permanently store it. 

The Office of Fossil Energy and Carbon Management (FECM) continues to operate a research division focused on the production of oil, gas, and coal. But it’s now named the Office of Resource Sustainability and its central task is minimizing the impacts from the production of those fossil fuels, says Jennifer Wilcox, a carbon removal researcher, who joined the office at the start of the Biden administration. She now serves as principal deputy assistant secretary of FECM, overseeing both research and development divisions along with Brad Crabtree, the assistant secretary of the office. 

FECM’s efforts will be turbocharged by a series of recent federal laws, including the Inflation Reduction Act, which significantly boosts tax subsidies for carbon capture, removal, and storage. The CHIPS and Science Act, signed into law in August, authorizes (but doesn’t actually appropriate) $1 billion for carbon removal research and development at FECM. But most notably, the Infrastructure Investment and Jobs Act that Biden enacted in late 2021 will direct some $12 billion into carbon capture and removal, including pipelines and storage facilities. 

The FECM will play a key role in determining where much of the money goes.

Jennifer Wilcox, a prominent carbon removal researcher, is the principal deputy assistant secretary at the US Department of Energy’s Office of Fossil Energy and Carbon Management.

Following the passage of the infrastructure law, the Department of Energy announced a $2.5 billion investment to accelerate and validate ways of safely storing carbon dioxide in underground formations, as well as $3.5 billion in funding for pilot and demonstration projects aimed at preventing nearly all carbon emissions from fossil-fuel power plants and industrial facilities, such as those producing cement, pulp and paper, and iron and steel. It has also moved ahead with a $3.5 billion program to develop four regional hubs for direct-air-capture projects, an effort to develop factories that can suck at least 1 million metric tons of carbon dioxide from the air each year. 

Last week, I spoke with Wilcox and Noah Deich, deputy assistant secretary for carbon management within FECM, about the new direction at the Department of Energy, where the billions of dollars will be put to work, and how they’re striving to address concerns about carbon capture and the ongoing harms from fossil fuels.

'We need to invest today'

Wilcox and Deich face a tricky balancing act.

Many environmentalists, social justice advocates, and those in the climate community fear that government subsidies, funding and support for carbon capture will extend the life of fossil-fuel plants, slow the shift to carbon-free energy sources, and grant a social license for ongoing extraction of oil and gas. In addition, a number of carbon capture projects that the Department of Energy heavily funded in the past subsequently shut down.

But the country still relies heavily on gas and coal plants. By funding and supporting pilot and demonstration projects, Wilcox and Deich stress, FECM is striving to reduce the risks and costs of carbon capture tools that could dramatically slash the nation’s emissions and reduce rising climate dangers. The hope is that this, in turn, will get more of the private sector to take on such projects on its own. In addition, they note that the investments FECM makes across the organization will all come with rigorous requirements, including environment justice commitments laid out in an earlier document.

Wilcox says parts of the criticism are correct: carbon capture and storage at natural-gas plants “is enabling more gas production.” 

“But we don’t have a choice,” she adds. “It needs to be a part of our tool kit, and we need to invest today in order for us to even have the option.”

That’s because, despite the growth of clean alternatives like solar and wind, there’s a huge existing fleet of natural-gas and coal plants across the nation, many relatively new.

“The reality is, if we don’t invest in this solution, there’s going to be power plants that will continue to emit,” she says.

She adds that carbon capture is also crucial for cleaning up many industrial processes, which rely on heat from fossil-fuel-driven furnaces and where carbon dioxide is often a byproduct of production, as in cement and steel. Here too, it’s the only way to retrofit expensive industrial plants and factories already in place.  

Wilcox notes there are 91 cement plants pumping out about 70 million tons of carbon dioxide per year, many with newer generation kilns, and all delivering a product of a specific quality that’s crucial to their customers and the safety of the structures made from it.

Adding carbon capture equipment to those facilities is critical. 

“This is a solution that provides minimal barriers for adoption for the industry,” she says. “It’s a retrofit to an existing facility that they’ve already invested in.”

There are emerging alternative ways of producing steel, cement, and other industrial products that may allow these sectors to address emissions directly. Deich says we need to invest in and support those solutions, but he notes it could take decades to develop them, test them, and scale them up.

“We don’t have the time to wait when we have carbon management solutions that we think can be deployed within the next few years in a technically, economically, and socially responsible way,” he says.

Adding carbon capture equipment to facilities is just one aspect of the job. Wilcox and her team are also focused on removing carbon already in the atmosphere. There are criticisms of this concept too, including fears that it  creates a moral hazard, inviting governments and companies to lean on it at the expense of cutting emissions.

Wilcox, however, says that carbon removal will be a critical tool for balancing out emissions from sectors of the economy that are really difficult to decarbonize, like aviation, maritime shipping, and agriculture. Numerous studies also find that the world may need to remove billions of tons per year by around midcentury to prevent the planet from heating more than  2 ˚C beyond preindustrial levels, or to pull it back from that threshold.

FECM is working toward Biden’s climate goals in several other ways as well,  including supporting the development of clean forms of hydrogen, tools to monitor methane emissions, and more sustainable ways of extracting the critical minerals that will be essential for the transition to clean energy.

Social justice concerns

Burning fossil fuels produces various pollutants beside carbon dioxide that can harm human health. These disproportionately affect the poor communities that often surround power plants and other industrial facilities, raising social justice concerns.

Wilcox notes that both natural-gas plants and cement plants will actually need to implement additional processes to reduce some pollutants, including nitrogen oxides and sulfur oxides, as a first step for the carbon capture technology to work effectively. She adds that project applicants will also need to monitor these and other pollutants. 

Deich says that the funding opportunities will also require companies to engage with communities, commit to develop local workforces, and assess climate emissions across their technologies’ life cycles and supply chains. They’ll also be expected to identify and address potential harms from the projects, ensure that benefits are distributed in equitable ways, and be willing to walk away if communities reject projects.

“We’re going to make sure that these projects only go in places where communities are not pushing against them,” he says.

Noah Deich is the deputy assistant secretary for carbon management at the Office of Fossil Energy and Carbon Management.

By supporting projects that take these issues seriously and demonstrate that the technology can dramatically cut emissions, they hope to shift the conversation on carbon capture and dispel the blanket rejection of it in some circles, he says.

Another big open question is the extent to which the power sector, oil and gas companies, and heavy industry will want to move ahead with such expensive projects, given the costs, risks, and lack of policy mandates.

Wilcox responded that they already are, pointing to projects that FECM has already funded over the last two years, which include design studies for retrofitting several cement plants. There are also dozens of planned US carbon capture projects listed in the database maintained by the Global CCS Institute, including natural-gas and ethanol facilities.

Deich says companies are already feeling growing pressure from customers who want to cut emissions across their supply chains, and that they see where the business and regulatory trend lines are pointing. Those that hope to be in business in 2050 are beginning to take steps now.

“The people who move first will gain first-mover advantages. They will have the technical and human capital to be able to build these projects, cheaper, faster, more effectively,” he says. “In the long run, it’s a smart bet.”

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