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LABI Defends Energy Dominance in Late-Session CCS Injection Fee Discussion

 

With less than a week to go before Sine Die, lawmakers in House Natural Resources took up a far-reaching proposal dealing with carbon capture and sequestration (CCS) injection fees—a conversation with enormous implications for Louisiana’s energy future and one LABI stressed must be approached thoughtfully, transparently and deliberately, not through rushed policymaking in the final days of session.

At the center of the discussion was HB 1152 by Rep. Neil Riser (R-Columbia), legislation that would extend fees paid by CCS storage facilities even after the state’s existing Carbon Dioxide Geologic Storage Trust Fund reaches its current $5 million cap. The bill would also create new community protection and emergency preparedness accounts funded by those continued “excess fees.”

While LABI did not take a position on the bill as originally filed, we raised significant concerns about advancing a major new fee structure in the final week of session without a full understanding of its long-term ramifications on investment, competitiveness and Louisiana’s position as a global energy leader. LABI President and CEO Will Green delivered powerful testimony reminding lawmakers what is at stake as Louisiana competes for historic levels of energy investment.

“We do have about $100 billion in projects already occurring or announced, and a significant amount of those projects do have a CCS component. They’re obviously watching very closely all the moves we make and the decisions that are undertaken at the Capitol here today, but so are the next $100 billion.”

He also emphasized that Louisiana has earned national energy leadership status that balances economic growth with environmental stewardship and regulatory certainty.

“We’ve got a tremendous opportunity to continue to lead on a local, national and global scale when it comes to the all-of-the-above energy approach, but we’ve got to do that the right way,” 

LABI stressed that certainty, transparency and predictability remain essential as companies evaluate where to deploy billions in capital investment. Green warned lawmakers that creating an entirely new fee framework in the closing days of session risks sending the wrong signal to current and future investors alike.

“I don’t care if you’re talking about an inventory tax or an income tax or an injection fee, you need certainty, you need predictability and you need transparency through that process.”

Louisiana’s leadership in CCS has positioned the state at the forefront of next-generation energy development, particularly after securing federal Class VI primacy authority, however, the state’s competitive advantage cannot be taken for granted as our neighbors work to catch up.

“I think that there’s a way we can do that and we can set it up and we can do it correctly where it gives everybody some comfort, but not when we’re a week left of session and we’re trying to figure it out on the fly. I just don’t want to see us build this plane as we’re flying it. Companies are watching and they’re looking at where they want to invest billions of dollars.”

Following committee discussion and testimony, Rep. Riser moved to voluntarily defer both the bill and the proposed amendment, with an expectation that it will be heard prior to Monday’s adjournment. With LABI’s agreement, legislators and coalition partners will continue to work towards a reasonable solution—a recognition of the significant policy questions still surrounding the proposal and the need for additional review before moving forward with a measure carrying such substantial economic and competitive implications for the state.