Notice of Intent Regarding Launching a Voluntary Carbon Dioxide Removal Purchasing Challenge; DOE Carbon Dioxide Removal Purchasing (CO2RP) Challenge, 18626-18629 [2024-05269]

Download as PDF ddrumheller on DSK120RN23PROD with NOTICES1 18626 Federal Register / Vol. 89, No. 51 / Thursday, March 14, 2024 / Notices August 8, 2005.2 A qualified hydroelectric facility may receive payments for a period of 10 consecutive fiscal years, known as the incentive period, which begins with the fiscal year that electric energy generated from the facility is first eligible for such payments.3 Payments made by the Secretary are based on the number of kilowatt hours of hydroelectric energy generated by the facility during the incentive period. The amount of such payment shall be 1.8 cents per kilowatt hour (as adjusted by the Internal Revenue Code of 1986), subject to the availability of appropriations, except that no facility may receive more than $1,000,000 in one calendar year.4 No payments will be made after the expiration of the period of 32 fiscal years beginning with the first full fiscal year occurring after August 8, 2005, and no payment may be made under this section to any such facility after a payment has been made with respect to such facility for a period of 10 fiscal years.5 The Secretary is authorized to carry out the purposes of this program for each of the fiscal years of 2021 through 2036.6 In section 242, Congress defines a qualified hydroelectric facility to mean ‘‘a turbine or other generating device owned or solely operated by a nonFederal entity—(A) that generates hydroelectric energy for sale; and (B)(i) that is added to an existing dam or conduit; or (ii)(I) that has generating capacity of not more than 20 megawatts; (II) for which the non-Federal entity has received a construction authorization from the Federal Energy Regulatory Commission [(FERC)], if applicable; and (III) that is constructed in an area in which there is inadequate electric service, as determined by the Secretary, including by taking into consideration— (aa) access to the electric grid; (bb) the frequency of electric outages; or (cc) the affordability of electricity.’’ 7 Additionally, Congress defined an existing dam or conduit to mean any dam or conduit constructed and completed before November 15, 2021, and ‘‘which does not require any construction or enlargement of impoundment or diversion structures (other than repair or reconstruction) in connection with the installation of a turbine or other generating device.’’ 8 The term conduit maintains the same 2 42 U.S.C. 15881(c). U.S.C. 15881(d). 4 42 U.S.C. 15881(e) 5 42 U.S.C. 15881(f). 6 42 U.S.C. 15881(g). 7 42 U.S.C. 15881(b)(1). 8 42 U.S.C. 15881(b)(2). 3 42 VerDate Sep<11>2014 16:47 Mar 13, 2024 meaning here as when used in section 30(a)(2) of the Federal Power Act (16 U.S.C. 823a(a)(3)(A)).9 Further, these defined terms apply without regard to the hydroelectric kilowatt capacity of the facility, without regard to whether the facility uses a dam owned by a governmental or nongovernmental entity, and without regard to whether the facility begins operation on or after the date August 8, 2005.10 This guidance applies to generation in calendar year 2023 and is available at: www.energy.gov/gdo/section-242hydroelectric-production-incentiveprogram. Each application will be reviewed based on the contents of the guidance. DOE notes that applicants that received incentive payments for prior calendar years must submit a new and complete application addressing all eligibility requirements for hydroelectricity generated and sold in calendar year 2023. DOE will not consider previously submitted application materials. Applications that refer to previous application materials or statements in lieu of submitting current information will not be considered. As authorized under section 242 of EPAct 2005, and as explained in the guidance, DOE also notes that it will only accept applications from qualified hydroelectric facilities that began operations at an existing dam or conduit between October 1, 2005, and September 30, 2027. When submitting information to DOE for the section 242 incentive, it is recommended that applicants carefully read and review the completed content of the guidance for this process. When reviewing applications, DOE may corroborate the information provided with information that DOE finds through FERC e-filings, contact with power off-taker, and other due diligence measure carried out by reviewing officials. DOE may require the applicant to conduct and submit an independent audit at its own expense, or DOE may conduct an audit to verify the number of kilowatt-hours claimed to have been generated and sold by the qualified hydroelectric facility and for which an incentive payment has been requested or made. Signing Authority This document of the Department of Energy was signed on February 28, 2024, by Maria D. Robinson, Director, Grid Deployment Office, pursuant to delegated authority from the Secretary 9 42 U.S.C. 15881(b)(3). U.S.C. 15881(b). 10 42 Jkt 262001 PO 00000 Frm 00037 Fmt 4703 Sfmt 4703 of Energy. That document with the original signature and date is maintained by DOE. For administrative purposes only, and in compliance with requirements of the Office of the Federal Register, the undersigned DOE Federal Register Liaison Officer has been authorized to sign and submit the document in electronic format for publication, as an official document of the Department of Energy. This administrative process in no way alters the legal effect of this document upon publication in the Federal Register. Signed in Washington, DC, on March 6, 2024. Treena V. Garrett, Federal Register Liaison Officer, U.S. Department of Energy. [FR Doc. 2024–05096 Filed 3–13–24; 8:45 am] BILLING CODE 6450–01–P DEPARTMENT OF ENERGY Notice of Intent Regarding Launching a Voluntary Carbon Dioxide Removal Purchasing Challenge; DOE Carbon Dioxide Removal Purchasing (CO2RP) Challenge Office of Fossil Energy and Carbon Management, Department of Energy. AGENCY: ACTION: Notice of intent. The Department of Energy (DOE or the Department), Office of Fossil Energy and Carbon Management (FECM) is issuing this Notice of Intent (NOI) to notify interested parties of its intent to launch a Voluntary Carbon Dioxide (CO2) Removal Purchasing (CO2RP) Challenge. The CO2RP Challenge will call on other organizations to purchase small and growing quantities of high-quality, permanent CO2 Removal (CDR) credits. The CO2RP Challenge will operate in coordination with DOE’s Carbon Dioxide Removal Purchase Pilot Prize (CDR Purchase Prize), through which the Department will award up to $30,000,000 across ten prize winners that successfully deliver their committed CDR credits. In addition, the Challenge will invite CDR suppliers that were not selected for or did not apply to the DOE CDR Purchase Prize to seek designation as a ‘‘next wave’’ supplier that demonstrates promise for other future DOE or private sector CDR credit purchasing efforts. CDR credit suppliers participating in the CO2RP Challenge through pursuit of designation within DOE’s list of ‘‘next wave’’ CDR credit providers will submit CDR credit proposals to DOE for review. SUMMARY: E:\FR\FM\14MRN1.SGM 14MRN1 Federal Register / Vol. 89, No. 51 / Thursday, March 14, 2024 / Notices Written comments are requested by May 15, 2024. ADDRESSES: Interested parties may submit comments electronically to VoluntaryCDRchallenge@hq.doe.gov and include ‘‘Voluntary CDR Purchasing Challenge’’ in the subject line. Responses must be provided as attachments to an email. Only electronic responses will be accepted. FOR FURTHER INFORMATION CONTACT: Questions may be directed to Rory Jacobson, Acting Division Director for Carbon Dioxide Removal, rory.jacobson@hq.doe.gov or (202)–586– 1650. SUPPLEMENTARY INFORMATION: DATES: ddrumheller on DSK120RN23PROD with NOTICES1 I. Background Large-scale carbon dioxide removal (‘‘CDR’’) is critical to reach net-zero targets by 2050 and is anticipated to serve an important role as a counterbalance for hard to abate sectors and a mechanism to reduce atmospheric carbon dioxide. The US Long Term Strategy 1 expects that at least 100 million tonnes of technological CDR (in addition to land use, land use change, and forestry (LULUCF) approaches) will be required for the US to achieve netzero by 2050. Leading analyses by scientific bodies like the Intergovernmental Panel on Climate Change (IPCC) and the National Academies of Sciences (NAS) anticipate that CDR will be needed at least at the gigatonne scale by mid-century to deliver on the Paris Agreement goals.2 While these analyses collectively make clear that reducing emissions directly (i.e., without carbon credit purchases) is the primary long-term strategy for climate mitigation, in the vast majority of cases, CDR is essential as a complement to these efforts to avoid exceeding committed emissions targets and accelerate the pace of mitigation. Currently, CDR pathways across the DOE portfolio are at varying levels of technical maturity and few pathways have been commercially demonstrated. Further, while a diverse portfolio of CDR approaches holds significant promise towards delivering on the United States’ Long-Term Strategy, these pathways face common challenges to achieve scale, including factors like (1) cost, (2) measurement, reporting, and 1 The Long-Term Strategy of the United States: Pathways to Net-Zero Greenhouse Gas Emissions by 2050, US Department of State and Executive Office of the President, (November 2021), https:// www.whitehouse.gov/wp-content/uploads/2021/10/ US-Long-Term-Strategy.pdf. 2 Negative Emissions Technologies and Reliable Sequestration: A Research Agenda (2019), National Academies of Sciences, Engineering, and Medicine, https://doi.org/10.17226/25259. VerDate Sep<11>2014 16:47 Mar 13, 2024 Jkt 262001 verification (‘‘MRV’’), and (3) resource constraints. For this reason, DOE announced a ‘‘Carbon Negative Shot’’ initiative at the 2021 United Nations Climate Change Conference (commonly referred to as COP26), aimed at catalyzing innovation across a portfolio of approaches to enable gigatonne-scale CDR at less than $100 per tonne CO2e net removed for at minimum 100 years, inclusive of MRV, within a decade.3 In addition to piloting an extensive portfolio of CDR pathways, advancing and establishing MRV best practices and guidance, and investing in research and development to support supply (‘‘push’’), DOE is exploring opportunities to establish workable demand (‘‘pull’’) incentive mechanisms. On August 10, 2023, the DOE and the National Energy Technology Laboratory (NETL) published a Notice of Intent (DE–FOA–0003081) to issue Funding Opportunity Announcement No. DE– FOA–0003082, titled Carbon Negative Shot Pilots, and Other Funding Opportunities.4 These intended funding opportunities included a Carbon Negative Shot Pilots FOA (DE–FOA– 0003082), a Direct Air Capture (DAC) Commercial Pilot Prize, and a CDR Purchase Prize. Launched on September 29, 2023, the CDR Purchase Prize is a historic, firstof-a-kind government purchasing program for permanent CDR credit purchasing.5 The CDR Purchase Prize follows in the footsteps of private businesses and coalitions that have shown how relatively small-scale purchases of CDR credits can have an outsized impact on catalyzing technology innovation and the advancement of standards for robust MRV and carbon accounting. The CDR Purchase Prize will award up to $35M of CDR credit purchases, across four CDR areas of interest: (1) direct air capture (DAC), (2) enhanced CO2 mineralization, (3) biomass carbon removal with storage (BiCRS), and 4) 3 On September 29, 2023, the U.S. Department of Energy’s (DOE) Office of Fossil energy and Carbon Management (FECM) announced up to $35 million to advance technologies that permanently remove carbon dioxide from the atmosphere. See, Carbon Dioxide Removal Purchase Pilot Prize, Office of Fossil Energy and Carbon Management, (September 29, 2023), https://www.energy.gov/fecm/carbondioxide-removal-purchase-pilot-prize. 4 Notice of Intent to Issue Funding Opportunity: Carbon Negative Shot Pilots, Office of Fossil Energy and Carbon Management, (August 11, 2023), https://www.energy.gov/fecm/notice-intent-issuefunding-opportunity-carbon-negative-shot-pilots. 5 DOE Announces $35 Million to Accelerate Carbon Dioxide Removal, Office of Fossil Energy and Carbon Management, (September 29, 2023). https://www.energy.gov/fecm/articles/doeannounces-35-million-accelerate-carbon-dioxideremoval. PO 00000 Frm 00038 Fmt 4703 Sfmt 4703 18627 other planned and managed carbon sinks with secure geological storage or equivalent. The first-round application for the program closed on December 14, 2023. In spring 2024, DOE will announce up to 25 semifinalists that have submitted the highest quality CDR Credit Concept Proposals for how they plan to deliver independently verified, high-quality CDR credits to the US government with secure geological or equivalent storage. DOE will then release the final rules for how semifinalists will be evaluated and selected to secure one of the 10 finalists awards, which will provide finalists up to $3M upon delivery of their verified CDR credits. DOE’s CDR Purchase Prize is designed to catalyze further voluntary CDR credit purchases in several ways, including: • Supplier transparency for prospective CDR credit purchasers: DOE and the National Labs will conduct rigorous technical diligence on all applicants, and our pool of semifinalists will offer a portfolio of CDR project developers with a high chance of delivering robust CDR credits in the near future. • Purchase contract norms: DOE will set norms for what qualifies as highquality CDR credits, and what MRV methods and broader delivery terms are appropriate for CDR credit purchasing, including efforts such as publishing model CDR credit purchasing templates and term sheets for private buyers to use as a starting point for their own purchases. • Motivation for further action: DOE’s initiative is designed to show the importance and urgency of purchasing CDR credits today, so that governments and businesses alike invest more resources in CDR now. In addition, the CDR Purchase Prize is designed to challenge CDR suppliers to sign up as many new private purchasers as they can by including the number of external purchase commitments as part of the selection criteria for from the semifinals to the finals. This will simultaneously enable DOE to amplify the demand for high-quality CDR credits with the greatest scalability and demand, while also providing potential CDR credit purchasers in the private sector with a short list of projects that have successfully undergone initial DOE assessment. • Enhancing CDR credit demand integrity: DOE will model how CDR credit purchasing organizations can account for credit purchases and retirements transparently and with the E:\FR\FM\14MRN1.SGM 14MRN1 ddrumheller on DSK120RN23PROD with NOTICES1 18628 Federal Register / Vol. 89, No. 51 / Thursday, March 14, 2024 / Notices care needed to ensure that credits do not substitute for emissions reductions.6 DOE recognizes that the CDR Purchase Prize alone is insufficient to catalyze the marketplace for CDR credits. Even with the selection criteria encouraging semifinalists to secure as many purchases as possible, DOE recognizes that the pool of CDR credit purchasers must be significantly larger than at present for the industry to scale successfully. CDR is likely to be essential for many organizations to meet net-zero goals, yet only a few dozen organizations have purchased permanent CDR credits to date. This means that potentially thousands of additional organizations that have committed to net-zero climate targets will need to start buying permanent CDR credits at small and growing scales today. If organizations fail to begin purchasing CDR today, the field will fail to scale CDR supply as quickly as needed, and CDR solutions will not be available at the cost, scale, or with the necessary MRV standards and community safeguards needed to achieve net zero targets. Furthermore, regulators and civil society groups have indicated that permanent CDR can represent an especially high integrity approach for carbon credits to meet disclosures or other regulations around carbon credit and net-zero claims. Organizations that build out permanent CDR portfolios today may attain advantages in the context of any future carbon-related regulatory compliance regimes. Yet despite the imperative for voluntary CDR credit purchases today, several factors are inhibiting the growth of voluntary CDR credit markets, including: 1. Insufficient incentives: Companies have no requirement to purchase CDR credits as part of their climate plans, which is compounded by a lack of clear and consistent direction by civil society groups working on corporate climate disclosure and action on the appropriate role for these credits in near-term decarbonization activities. Government subsidies for CDR projects have grown in recent years but remain far below levels needed to catalyze widespread adoption. 2. High prices: CDR credits are more expensive than emission reduction credits, with engineered CDR credits selling for between $200–1,000 per tonne CO2e net removed. These prices 6 All CO RP Challenge participants will be 2 encouraged to adopt the position—consistent with DOE’s position—that CDR is best viewed as part of a decarbonization portfolio that first achieves maximum emissions reductions from existing sources. VerDate Sep<11>2014 16:47 Mar 13, 2024 Jkt 262001 can represent an approximately 50–250x premium of average emissions reductions credits. Existing subsidies are insufficient to close the gap between the prices buyers are willing to pay, and the funding needed to scale CDR technologies. 3. Complicated procurement: There is currently limited expertise among most corporate carbon credit purchasers on how to evaluate carbon removal companies and MRV protocols, and to design procurement agreements that are fair for all parties and bankable for suppliers. 4. Voluntary carbon markets (VCMs) challenges: VCMs remain relatively small and face challenges related to market transparency and credit integrity. However, high-integrity VCMs represent potentially important channels for unlocking significant capital for climate-impactful investments that can help limit the increase in the global average temperature to 1.5 °C. Additional action is needed by civil society, the private sector, and governments to address relevant challenges and enable conditions for high-integrity VCMs to grow. II. Voluntary Carbon Dioxide Removal Purchasing Challenge To further support the CDR credit purchasing market, DOE intends to launch a two-pronged CO2 Removal Purchasers Challenge (‘‘CO2RP Challenge’’). By engaging with both CDR credit buyers and suppliers, the DOE CO2RP Challenge will enhance market transparency and bolster the quality and integrity of CDR credit supply, to accelerate, improve, and scale the CDR credit market. a. Credit Buyers DOE will ask for any organization or government that discloses its GHG inventory to join the ‘‘CO2RP Challenge’’ by purchasing a small and growing volume of permanent CDR. To join the Challenge, an organization will be required to: • Purchase and retire permanent CDR annually, aligned with the requirements and assessment criteria of DOE’s purchases, starting no later than 2025. • Disclose to DOE every associated CDR purchase, which will maintain a public inventory of: Æ CDR credit purchasing entity; Æ CDR credit supplier entity; Æ CDR project delivering credits; Æ CDR crediting methodology, protocol, or standard (inclusive of MRV); and Æ Date verified of CDR credit volume delivered and retired. PO 00000 Frm 00039 Fmt 4703 Sfmt 4703 • Require but kept private: Æ price paid per tonne of CDR. • Disclose to the public: Æ Transparent accounting of CDR and any other forms of carbon credits separately from activities that directly reduce emissions in their supply chains in any annual climate related disclosures. Participation in the CO2RP Challenge will not preclude CDR buyers from participating in other buyer coalitions or coordinated funding initiatives. The Challenge is intended to consolidate CDR credit purchasing efforts across private organizations that align with DOE’s Carbon Negative Shot implementation strategy. The Challenge will not require CDR credit buyers to purchase a minimum volume; however, it is anticipated DOE may issue guidance or resources to help organizations incorporate CDR appropriately into their greenhouse gas inventories and net-zero strategies.7 b. CDR Credit Suppliers DOE will encourage additional CDR credit suppliers to join the CO2RP Challenge by offering to evaluate a new round of credits using the process implemented in Phase 1 of the CDR Purchase Prize. This component of the CO2RP Challenge is intended to identify CDR credit suppliers that may have been too early to apply to the CDR Purchase Prize but are likely to have strong technical and commercial viability. While no new funding will be available for this effort to suppliers, DOE will and publish a list of ‘‘next wave’’ applications across the four area 8 of interest categories outlined in the CDR Purchase Prize from: • Organizations that were not selected to participate in the semifinalist pool for the CDR Purchase Prize but have significantly updated and advanced their credit offering with new project design, MRV, or project offerings. • Organizations offering credits from projects that did not apply or were not eligible for the CDR Purchase Prize but 7 DOE anticipates issuing more detailed guidance regarding eligible and appropriate Scope 1–3 greenhouse gas accounting and attribution of CDR credit purchases, as well as clear guidelines prioritizing direct emissions reductions at the greatest pace and scale feasible. For more information on Scope 1–3 greenhouse gas accounting, please see EPA Greenhouse Gas Inventory Guidance for Scope 1 and 2, and (https:// www.epa.gov/climateleadership/scope-1-and-scope2-inventory-guidance) Scope 3 (https:// www.epa.gov/climateleadership/scope-3-inventoryguidance). 8 Please consult the Official Rules document for the CDR Purchase Pilot prize for detailed descriptions of eligible CDR pathways. See: https:// www.herox.com/DAC-commercial. E:\FR\FM\14MRN1.SGM 14MRN1 Federal Register / Vol. 89, No. 51 / Thursday, March 14, 2024 / Notices anticipate selling voluntary credits within the next calendar year. DEPARTMENT OF ENERGY International Energy Agency Meetings Response Guidelines ACTION: The Industry Advisory Board (IAB) to the International Energy Agency (IEA) will meet on March 21, 22, 2024, as a hybrid meeting via webinar and in person, in connection with a joint meeting of the IEA’s Standing Group on Emergency Questions (SEQ) and the IEA’s Standing Group on the Oil Market (SOM) which is scheduled at the same time via webinar. SUMMARY: ADDRESSES: Pursuant to 10 CFR 1004.11, any person submitting information that he or she believes to be confidential and exempt by law from public disclosure should submit via email two wellmarked copies: One copy of the document marked ‘‘confidential’’ including all the information believed to be confidential, and one copy of the document marked ‘‘non-confidential’’ with the information believed to be confidential deleted. Submit these documents via email. DOE will make its own determination about the confidential status of the information and treat it according to its determination. ddrumheller on DSK120RN23PROD with NOTICES1 Signing Authority This document of the Department of Energy was signed on March 7, 2024, by Dr. Jennifer Wilcox, Acting Assistant Secretary, Office of Fossil Energy and Carbon Management, pursuant to delegated authority from the Secretary of Energy. That document with the original signature and date is maintained by DOE. For administrative purposes only, and in compliance with requirements of the Office of the Federal Register, the undersigned DOE Federal Register Liaison Officer has been authorized to sign and submit the document in electronic format for publication, as an official document of the Department of Energy. This administrative process in no way alters the legal effect of this document upon publication in the Federal Register. [FR Doc. 2024–05269 Filed 3–13–24; 8:45 am] BILLING CODE 6450–01–P VerDate Sep<11>2014 16:47 Mar 13, 2024 Jkt 262001 March 21–22, 2024. The location details of the SEQ and SOM webinar meeting are under the control of the IEA Secretariat, located at 9 rue de la Fe´de´ration, 75015 Paris, France. The in person meeting will take place at IEA Headquarters, 9 rue de la Fe´de´ration, 75015 Paris, France. DATES: Confidential Business Information Signed in Washington, DC, on March 7, 2024. Treena V. Garrett, Federal Register Liaison Officer, U.S. Department of Energy. Department of Energy. Notice of meetings. AGENCY: NOI responses shall include: 1. NOI/RFI title and reference number; 2. Name(s), phone number(s), and email address(es) for the principal point(s) of contact; 3. Institution or organization affiliation and postal address; and 4. Comments and recommendations regarding the intended structure, objectives, and implementation of the DOE Carbon Dioxide Removal Purchasing (CO2RP) Challenge as proposed within this NOI. Mr. Thomas Reilly, Assistant General Counsel for International and National Security Programs, Department of Energy, 1000 Independence Avenue SW, Washington, DC 20585, (202) 586– 5000. SUPPLEMENTARY INFORMATION: In accordance with section 252(c)(1)(A)(i) of the Energy Policy and Conservation Act (42 U.S.C. 6272(c)(1)(A)(i)) (EPCA), the following notice of meetings is provided: A meeting of the Industry Advisory Board (IAB) to the International Energy Agency (IEA) will be held in person and via webinar at the IEA Headquarters, 9 rue de la Fe´de´ration, 75015 Paris, commencing at 9:30 a.m., Paris time, on March 21, 2024. The purpose of this notice is to permit attendance by representatives of U.S. company members of the IAB at a joint meeting of the IEA’s Standing Group on Emergency Questions (SEQ) and the IEA’s Standing Group on the Oil Market (SOM), which is scheduled to be held at the same location in person and via webinar at the same time. The agenda of the meeting is under the control of the SEQ and the SOM. It is expected that the SEQ and the SOM will adopt the following agenda: FOR FURTHER INFORMATION CONTACT: Welcome by the Chair 1. Adoption of the Agenda 2. Approval of Summary Record of meeting of 16 November 2023 3. Update on the Current Oil Market Situation Update on the Current Gas Market PO 00000 Frm 00040 Fmt 4703 Sfmt 4703 18629 Situation 4. Reports on Recent Oil Market and Policy Developments in IEA member countries 5. Update on IEA–OPEC–IEF Joint Work Program 6. India Oil Market Report—Outlook to 2030 7. Update on Global Biofuel Developments IEA Ministerial Outcomes Roundtable: Upstream Investment Trends and Implications for Field Decline 8. IEA perspectives 9. Service company perspective 10. Oil company perspective 11. Moderated roundtable discussion 13. Any other business: Date of next SOM/SEQ meetings: 19– 20 June 2024 Close of meeting A meeting of the Industry Advisory Board (IAB) to the International Energy Agency (IEA) will be held in person and via webinar at the IEA Headquarters, 9 rue de la Fe´de´ration, 75015 Paris, commencing at 9:30 a.m., Paris time, on March 22, 2024. The purpose of this notice is to permit attendance by representatives of U.S. company members of the IAB at a meeting of the IEA’s Standing Group on Emergency Questions (SEQ), which is scheduled to be held at the same location in person and via webinar at the same time. The IAB will also hold a preparatory meeting among company representatives. The agenda for this preparatory meeting is to review the agenda for the SEQ meeting. The agenda of the SEQ meeting is under the control of the SEQ. It is expected that the SEQ will adopt the following agenda: Closed SEQ Session—IEA Member Countries Only 1. Adoption of the Agenda 2. Approval of the Summary Record of the 177th SEQ meeting 3. Stockholding Levels of IEA Member Countries 4. Review of the 2022 IEA Collective Action Open SEQ Session—Open to Association Countries 5. Data Reporting for Dedicated Emergency Stocks 6. Emergency Response Review of Slovak Republic 7. Critical Minerals Security 8. Mid-term Review of France 9. Industry Advisory Board Update 10. Mid-term Review of Canada 11. Emergency Response Review of United States E:\FR\FM\14MRN1.SGM 14MRN1

Agencies

[Federal Register Volume 89, Number 51 (Thursday, March 14, 2024)]
[Notices]
[Pages 18626-18629]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-05269]


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DEPARTMENT OF ENERGY


Notice of Intent Regarding Launching a Voluntary Carbon Dioxide 
Removal Purchasing Challenge; DOE Carbon Dioxide Removal Purchasing 
(CO2RP) Challenge

AGENCY: Office of Fossil Energy and Carbon Management, Department of 
Energy.

ACTION: Notice of intent.

-----------------------------------------------------------------------

SUMMARY: The Department of Energy (DOE or the Department), Office of 
Fossil Energy and Carbon Management (FECM) is issuing this Notice of 
Intent (NOI) to notify interested parties of its intent to launch a 
Voluntary Carbon Dioxide (CO2) Removal Purchasing 
(CO2RP) Challenge. The CO2RP Challenge will call 
on other organizations to purchase small and growing quantities of 
high-quality, permanent CO2 Removal (CDR) credits. The 
CO2RP Challenge will operate in coordination with DOE's 
Carbon Dioxide Removal Purchase Pilot Prize (CDR Purchase Prize), 
through which the Department will award up to $30,000,000 across ten 
prize winners that successfully deliver their committed CDR credits. In 
addition, the Challenge will invite CDR suppliers that were not 
selected for or did not apply to the DOE CDR Purchase Prize to seek 
designation as a ``next wave'' supplier that demonstrates promise for 
other future DOE or private sector CDR credit purchasing efforts. CDR 
credit suppliers participating in the CO2RP Challenge 
through pursuit of designation within DOE's list of ``next wave'' CDR 
credit providers will submit CDR credit proposals to DOE for review.

[[Page 18627]]


DATES: Written comments are requested by May 15, 2024.

ADDRESSES: Interested parties may submit comments electronically to 
[email protected] and include ``Voluntary CDR Purchasing 
Challenge'' in the subject line. Responses must be provided as 
attachments to an email. Only electronic responses will be accepted.

FOR FURTHER INFORMATION CONTACT: Questions may be directed to Rory 
Jacobson, Acting Division Director for Carbon Dioxide Removal, 
[email protected] or (202)-586-1650.

SUPPLEMENTARY INFORMATION: 

I. Background

    Large-scale carbon dioxide removal (``CDR'') is critical to reach 
net-zero targets by 2050 and is anticipated to serve an important role 
as a counterbalance for hard to abate sectors and a mechanism to reduce 
atmospheric carbon dioxide. The US Long Term Strategy \1\ expects that 
at least 100 million tonnes of technological CDR (in addition to land 
use, land use change, and forestry (LULUCF) approaches) will be 
required for the US to achieve net-zero by 2050. Leading analyses by 
scientific bodies like the Intergovernmental Panel on Climate Change 
(IPCC) and the National Academies of Sciences (NAS) anticipate that CDR 
will be needed at least at the gigatonne scale by mid-century to 
deliver on the Paris Agreement goals.\2\ While these analyses 
collectively make clear that reducing emissions directly (i.e., without 
carbon credit purchases) is the primary long-term strategy for climate 
mitigation, in the vast majority of cases, CDR is essential as a 
complement to these efforts to avoid exceeding committed emissions 
targets and accelerate the pace of mitigation.
---------------------------------------------------------------------------

    \1\ The Long-Term Strategy of the United States: Pathways to 
Net-Zero Greenhouse Gas Emissions by 2050, US Department of State 
and Executive Office of the President, (November 2021), https://www.whitehouse.gov/wp-content/uploads/2021/10/US-Long-Term-Strategy.pdf.
    \2\ Negative Emissions Technologies and Reliable Sequestration: 
A Research Agenda (2019), National Academies of Sciences, 
Engineering, and Medicine, https://doi.org/10.17226/25259.
---------------------------------------------------------------------------

    Currently, CDR pathways across the DOE portfolio are at varying 
levels of technical maturity and few pathways have been commercially 
demonstrated. Further, while a diverse portfolio of CDR approaches 
holds significant promise towards delivering on the United States' 
Long-Term Strategy, these pathways face common challenges to achieve 
scale, including factors like (1) cost, (2) measurement, reporting, and 
verification (``MRV''), and (3) resource constraints. For this reason, 
DOE announced a ``Carbon Negative Shot'' initiative at the 2021 United 
Nations Climate Change Conference (commonly referred to as COP26), 
aimed at catalyzing innovation across a portfolio of approaches to 
enable gigatonne-scale CDR at less than $100 per tonne CO2e 
net removed for at minimum 100 years, inclusive of MRV, within a 
decade.\3\ In addition to piloting an extensive portfolio of CDR 
pathways, advancing and establishing MRV best practices and guidance, 
and investing in research and development to support supply (``push''), 
DOE is exploring opportunities to establish workable demand (``pull'') 
incentive mechanisms.
---------------------------------------------------------------------------

    \3\ On September 29, 2023, the U.S. Department of Energy's (DOE) 
Office of Fossil energy and Carbon Management (FECM) announced up to 
$35 million to advance technologies that permanently remove carbon 
dioxide from the atmosphere. See, Carbon Dioxide Removal Purchase 
Pilot Prize, Office of Fossil Energy and Carbon Management, 
(September 29, 2023), https://www.energy.gov/fecm/carbon-dioxide-removal-purchase-pilot-prize.
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    On August 10, 2023, the DOE and the National Energy Technology 
Laboratory (NETL) published a Notice of Intent (DE-FOA-0003081) to 
issue Funding Opportunity Announcement No. DE-FOA-0003082, titled 
Carbon Negative Shot Pilots, and Other Funding Opportunities.\4\ These 
intended funding opportunities included a Carbon Negative Shot Pilots 
FOA (DE-FOA-0003082), a Direct Air Capture (DAC) Commercial Pilot 
Prize, and a CDR Purchase Prize.
---------------------------------------------------------------------------

    \4\ Notice of Intent to Issue Funding Opportunity: Carbon 
Negative Shot Pilots, Office of Fossil Energy and Carbon Management, 
(August 11, 2023), https://www.energy.gov/fecm/notice-intent-issue-funding-opportunity-carbon-negative-shot-pilots.
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    Launched on September 29, 2023, the CDR Purchase Prize is a 
historic, first-of-a-kind government purchasing program for permanent 
CDR credit purchasing.\5\ The CDR Purchase Prize follows in the 
footsteps of private businesses and coalitions that have shown how 
relatively small-scale purchases of CDR credits can have an outsized 
impact on catalyzing technology innovation and the advancement of 
standards for robust MRV and carbon accounting.
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    \5\ DOE Announces $35 Million to Accelerate Carbon Dioxide 
Removal, Office of Fossil Energy and Carbon Management, (September 
29, 2023). https://www.energy.gov/fecm/articles/doe-announces-35-million-accelerate-carbon-dioxide-removal.
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    The CDR Purchase Prize will award up to $35M of CDR credit 
purchases, across four CDR areas of interest: (1) direct air capture 
(DAC), (2) enhanced CO2 mineralization, (3) biomass carbon 
removal with storage (BiCRS), and 4) other planned and managed carbon 
sinks with secure geological storage or equivalent. The first-round 
application for the program closed on December 14, 2023. In spring 
2024, DOE will announce up to 25 semifinalists that have submitted the 
highest quality CDR Credit Concept Proposals for how they plan to 
deliver independently verified, high-quality CDR credits to the US 
government with secure geological or equivalent storage. DOE will then 
release the final rules for how semifinalists will be evaluated and 
selected to secure one of the 10 finalists awards, which will provide 
finalists up to $3M upon delivery of their verified CDR credits. DOE's 
CDR Purchase Prize is designed to catalyze further voluntary CDR credit 
purchases in several ways, including:
     Supplier transparency for prospective CDR credit 
purchasers: DOE and the National Labs will conduct rigorous technical 
diligence on all applicants, and our pool of semi-finalists will offer 
a portfolio of CDR project developers with a high chance of delivering 
robust CDR credits in the near future.
     Purchase contract norms: DOE will set norms for what 
qualifies as high-quality CDR credits, and what MRV methods and broader 
delivery terms are appropriate for CDR credit purchasing, including 
efforts such as publishing model CDR credit purchasing templates and 
term sheets for private buyers to use as a starting point for their own 
purchases.
     Motivation for further action: DOE's initiative is 
designed to show the importance and urgency of purchasing CDR credits 
today, so that governments and businesses alike invest more resources 
in CDR now. In addition, the CDR Purchase Prize is designed to 
challenge CDR suppliers to sign up as many new private purchasers as 
they can by including the number of external purchase commitments as 
part of the selection criteria for from the semifinals to the finals. 
This will simultaneously enable DOE to amplify the demand for high-
quality CDR credits with the greatest scalability and demand, while 
also providing potential CDR credit purchasers in the private sector 
with a short list of projects that have successfully undergone initial 
DOE assessment.
     Enhancing CDR credit demand integrity: DOE will model how 
CDR credit purchasing organizations can account for credit purchases 
and retirements transparently and with the

[[Page 18628]]

care needed to ensure that credits do not substitute for emissions 
reductions.\6\
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    \6\ All CO2RP Challenge participants will be 
encouraged to adopt the position--consistent with DOE's position--
that CDR is best viewed as part of a decarbonization portfolio that 
first achieves maximum emissions reductions from existing sources.
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    DOE recognizes that the CDR Purchase Prize alone is insufficient to 
catalyze the marketplace for CDR credits. Even with the selection 
criteria encouraging semifinalists to secure as many purchases as 
possible, DOE recognizes that the pool of CDR credit purchasers must be 
significantly larger than at present for the industry to scale 
successfully. CDR is likely to be essential for many organizations to 
meet net-zero goals, yet only a few dozen organizations have purchased 
permanent CDR credits to date. This means that potentially thousands of 
additional organizations that have committed to net-zero climate 
targets will need to start buying permanent CDR credits at small and 
growing scales today. If organizations fail to begin purchasing CDR 
today, the field will fail to scale CDR supply as quickly as needed, 
and CDR solutions will not be available at the cost, scale, or with the 
necessary MRV standards and community safeguards needed to achieve net 
zero targets. Furthermore, regulators and civil society groups have 
indicated that permanent CDR can represent an especially high integrity 
approach for carbon credits to meet disclosures or other regulations 
around carbon credit and net-zero claims. Organizations that build out 
permanent CDR portfolios today may attain advantages in the context of 
any future carbon-related regulatory compliance regimes.
    Yet despite the imperative for voluntary CDR credit purchases 
today, several factors are inhibiting the growth of voluntary CDR 
credit markets, including:
    1. Insufficient incentives: Companies have no requirement to 
purchase CDR credits as part of their climate plans, which is 
compounded by a lack of clear and consistent direction by civil society 
groups working on corporate climate disclosure and action on the 
appropriate role for these credits in near-term decarbonization 
activities. Government subsidies for CDR projects have grown in recent 
years but remain far below levels needed to catalyze widespread 
adoption.
    2. High prices: CDR credits are more expensive than emission 
reduction credits, with engineered CDR credits selling for between 
$200-1,000 per tonne CO2e net removed. These prices can 
represent an approximately 50-250x premium of average emissions 
reductions credits. Existing subsidies are insufficient to close the 
gap between the prices buyers are willing to pay, and the funding 
needed to scale CDR technologies.
    3. Complicated procurement: There is currently limited expertise 
among most corporate carbon credit purchasers on how to evaluate carbon 
removal companies and MRV protocols, and to design procurement 
agreements that are fair for all parties and bankable for suppliers.
    4. Voluntary carbon markets (VCMs) challenges: VCMs remain 
relatively small and face challenges related to market transparency and 
credit integrity. However, high-integrity VCMs represent potentially 
important channels for unlocking significant capital for climate-
impactful investments that can help limit the increase in the global 
average temperature to 1.5 [deg]C. Additional action is needed by civil 
society, the private sector, and governments to address relevant 
challenges and enable conditions for high-integrity VCMs to grow.

II. Voluntary Carbon Dioxide Removal Purchasing Challenge

    To further support the CDR credit purchasing market, DOE intends to 
launch a two-pronged CO2 Removal Purchasers Challenge 
(``CO2RP Challenge''). By engaging with both CDR credit 
buyers and suppliers, the DOE CO2RP Challenge will enhance 
market transparency and bolster the quality and integrity of CDR credit 
supply, to accelerate, improve, and scale the CDR credit market.

a. Credit Buyers

    DOE will ask for any organization or government that discloses its 
GHG inventory to join the ``CO2RP Challenge'' by purchasing 
a small and growing volume of permanent CDR. To join the Challenge, an 
organization will be required to:
     Purchase and retire permanent CDR annually, aligned with 
the requirements and assessment criteria of DOE's purchases, starting 
no later than 2025.
     Disclose to DOE every associated CDR purchase, which will 
maintain a public inventory of:
    [cir] CDR credit purchasing entity;
    [cir] CDR credit supplier entity;
    [cir] CDR project delivering credits;
    [cir] CDR crediting methodology, protocol, or standard (inclusive 
of MRV); and
    [cir] Date verified of CDR credit volume delivered and retired.
     Require but kept private:
    [cir] price paid per tonne of CDR.
     Disclose to the public:
    [cir] Transparent accounting of CDR and any other forms of carbon 
credits separately from activities that directly reduce emissions in 
their supply chains in any annual climate related disclosures.
    Participation in the CO2RP Challenge will not preclude 
CDR buyers from participating in other buyer coalitions or coordinated 
funding initiatives. The Challenge is intended to consolidate CDR 
credit purchasing efforts across private organizations that align with 
DOE's Carbon Negative Shot implementation strategy. The Challenge will 
not require CDR credit buyers to purchase a minimum volume; however, it 
is anticipated DOE may issue guidance or resources to help 
organizations incorporate CDR appropriately into their greenhouse gas 
inventories and net-zero strategies.\7\
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    \7\ DOE anticipates issuing more detailed guidance regarding 
eligible and appropriate Scope 1-3 greenhouse gas accounting and 
attribution of CDR credit purchases, as well as clear guidelines 
prioritizing direct emissions reductions at the greatest pace and 
scale feasible. For more information on Scope 1-3 greenhouse gas 
accounting, please see EPA Greenhouse Gas Inventory Guidance for 
Scope 1 and 2, and (https://www.epa.gov/climateleadership/scope-1-and-scope-2-inventory-guidance) Scope 3 (https://www.epa.gov/climateleadership/scope-3-inventory-guidance).
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b. CDR Credit Suppliers

    DOE will encourage additional CDR credit suppliers to join the 
CO2RP Challenge by offering to evaluate a new round of 
credits using the process implemented in Phase 1 of the CDR Purchase 
Prize. This component of the CO2RP Challenge is intended to 
identify CDR credit suppliers that may have been too early to apply to 
the CDR Purchase Prize but are likely to have strong technical and 
commercial viability. While no new funding will be available for this 
effort to suppliers, DOE will and publish a list of ``next wave'' 
applications across the four area \8\ of interest categories outlined 
in the CDR Purchase Prize from:
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    \8\ Please consult the Official Rules document for the CDR 
Purchase Pilot prize for detailed descriptions of eligible CDR 
pathways. See: https://www.herox.com/DAC-commercial.
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     Organizations that were not selected to participate in the 
semifinalist pool for the CDR Purchase Prize but have significantly 
updated and advanced their credit offering with new project design, 
MRV, or project offerings.
     Organizations offering credits from projects that did not 
apply or were not eligible for the CDR Purchase Prize but

[[Page 18629]]

anticipate selling voluntary credits within the next calendar year.

Response Guidelines

    NOI responses shall include:
    1. NOI/RFI title and reference number;
    2. Name(s), phone number(s), and email address(es) for the 
principal point(s) of contact;
    3. Institution or organization affiliation and postal address; and
    4. Comments and recommendations regarding the intended structure, 
objectives, and implementation of the DOE Carbon Dioxide Removal 
Purchasing (CO2RP) Challenge as proposed within this NOI.

Confidential Business Information

    Pursuant to 10 CFR 1004.11, any person submitting information that 
he or she believes to be confidential and exempt by law from public 
disclosure should submit via email two well-marked copies: One copy of 
the document marked ``confidential'' including all the information 
believed to be confidential, and one copy of the document marked ``non-
confidential'' with the information believed to be confidential 
deleted. Submit these documents via email. DOE will make its own 
determination about the confidential status of the information and 
treat it according to its determination.

Signing Authority

    This document of the Department of Energy was signed on March 7, 
2024, by Dr. Jennifer Wilcox, Acting Assistant Secretary, Office of 
Fossil Energy and Carbon Management, pursuant to delegated authority 
from the Secretary of Energy. That document with the original signature 
and date is maintained by DOE. For administrative purposes only, and in 
compliance with requirements of the Office of the Federal Register, the 
undersigned DOE Federal Register Liaison Officer has been authorized to 
sign and submit the document in electronic format for publication, as 
an official document of the Department of Energy. This administrative 
process in no way alters the legal effect of this document upon 
publication in the Federal Register.

    Signed in Washington, DC, on March 7, 2024.
Treena V. Garrett,
Federal Register Liaison Officer, U.S. Department of Energy.
[FR Doc. 2024-05269 Filed 3-13-24; 8:45 am]
BILLING CODE 6450-01-P
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