Bill provides redress for subsidized bad policy

A bill the Louisiana Legislature will consider during this spring’s regular session would redress bad federal government policy that diverts use of lands within the state to low priority purposes.

HB 4 by Republican state Rep. Chuck Owen would allow individual parishes to have a final say over carbon capture sequestration within their boundaries, subject to a popular veto. The governing authority may disapprove of a sequestration siting, but if it approves a referendum may be called by 15 percent of registered voters to hold a vote disapproving. Either way, local interests will determine whether such projects get built.

That’s as it should be, because of the bias built into the tax code that is the only thing, other than ideologically-based faith, that prompts any building of these facilities placed underground to store carbon produced in industrial or consumer surroundings. Understanding the interlocked nature of the process explains where Louisiana is and why the law is beneficial.

Carbon capture, in varying forms from attendant to some industrial process that produces carbon dioxide to grabbing it from ambient as a byproduct of things such as vehicle exhaust, is the idea that removing it from the atmosphere somehow conveys useful benefits to society. Ignoring the fact that increased levels of carbon dioxide bring a number of economic and social benefits to humans, climate alarmists of a pragmatic streak have seized upon the idea as a way of having fossil fuel use – which is forecast to continue to increase countering an energy transition that never will happen that both climate alarmist pragmatists and ideologues fail to understand – along with renewable use that will solve the intractable problems for the foreseeable future of renewable source characteristics of intermittency and prohibitive expense.

The problem is capture itself is prohibitively expensive, and even with generous federal government subsidies the only activity close to break-even is capture from a manufacturing process. That’s the expensive and entirely cost-ineffective side of the equation, which nevertheless is pursued because there are some commercial applications for it and/or an ideological imperative exists that it is one avenue to prevent the mythical catastrophic anthropogenic global warning scenario that exists as an article of faith among alarmists but which at present exists without any quality scientific basis to it. Unfortunately, these fanatics make a lot of noise and cow business into pursuing these kinds of wasteful projects.

So, it’s the other end of it, storage, where money could be made at the individual level and where Louisiana landowners become disproportionately advantaged given both the state’s geology and topography and the concentration of industries producing carbon and pipelines to transport it. But it has a different set of potential costs around how transport or storage leakage can have severe environmental and public health effects. In other words, the economic advantages of it to a community well may be outweighed by the low-probability but extremely high-cost disadvantages, and as there’s no climate emergency in the offing, communities that bear the risk of these disadvantages ought to have every say possible in whether they must submit to this.

Louisiana, for now among just four other states, has complete control over permits for wells that lead to storage capacity. But it has no control over federal tax credits that are driving this misallocation of resources that distort the marketplace into throwing money around for far more storage than the unsubsidized market would bear. That could change through the budget reconciliation process, by restoring much tougher eligibility requirements, reducing the value, and removing the refundability of it, but with the GOP having slim congressional majorities that doesn’t seem likely for now.

While government generally should be prevented from interfering with voluntary transactions between private parties, that its thumb already is on the scales in this instance justifies the exception with this bill. Hysteria at its root doesn’t make for good policy, and the bill at least partially corrects for that.