Colleen Jarrott Shares Insights on Louisiana's CCS Regulatory and Legislative Advances via Hart Energy

November 7, 2024

Hinshaw partner Colleen Jarrott was recently quoted by Hart Energy on developments in Louisiana's carbon capture and storage (CCS) landscape. She highlighted the state's regulatory and legislative efforts to facilitate and incentivize CCS projects, which aim to reduce greenhouse gas emissions by capturing and storing carbon dioxide (CO2) underground.

According to Jarrott, Louisiana has seen a surge in CCS development, with about 55 projects in the pipeline. She pointed to the federal Inflation Reduction Act, which enhanced the tax credit for CCS, and the state's adoption of rules to streamline the permitting and approval process. Jarrott also mentioned six new laws that took effect in August 2024, which will grant pipeline companies the power to acquire property rights for CO2 transportation and enable unitization for CO2 sequestration.

Jarrott explained that unitization allows CCS operators to overcome the challenge of obtaining consent from all landowners in the project area. "If one landowner is holding out, that won't totally sink the entire project. As long as you're able to show that you have 75% agreement of the other landowners, you're able to use a unitization process and go to the commissioner of conservation and get a certificate of unitization," she said. "You will be able to then use that for pore space."

Jarrott expressed optimism about Louisiana's potential to scale up CCS but acknowledged some possible hurdles, such as the high cost of the projects and the uncertainty of future legislation. She also noted that smaller companies may face more barriers to entry than larger enterprises.

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