The Loan Programs Office (LPO), in partnership with DOE’s Office of Fossil Energy and Carbon Management (FECM), offers access to capital for large-capacity, common-carrier carbon dioxide (CO2) transport projects (e.g., pipelines, rail, shipping, and other transport methods) under the Carbon Dioxide Transportation Infrastructure Finance and Innovation Act (CIFIA), as incorporated into and enacted under the Bipartisan Infrastructure Law of 2021.
Carbon capture, utilization, and storage (CCUS) technologies, including direct air capture (DAC), must be deployed at a large-scale in the coming decades to reduce hard-to-abate CO2 emissions from the industrial sector. CIFIA will support CCUS technology deployment by financing projects that build shared CO2 transport infrastructure. This infrastructure will benefit from economies of scale and help form an interconnected carbon management market.
Large common-carrier CO2 transport infrastructure shares similar barriers to deployment previously faced by other types of critical national infrastructure, such as high capital costs, short-term demand and utilization uncertainty, and chicken-and-egg challenges. Overcoming these barriers requires Federal, state, and local government support along with private investment. CIFIA was created to address these barriers.
The CIFIA Program Guidance provides details on the CIFIA program, including eligibility and application requirements.
Potential applicants to CIFIA can click here to request a no-fee, no-commitment pre-application consultation with DOE to discuss the proposed CIFIA project.
How can CIFIA support the deployment of carbon management technologies?
Carbon management technologies such as DAC, point-source carbon capture, carbon conversion, and CO2 transport and storage technologies must be deployed at a large-scale in the coming decades to meet the United States’ net-zero greenhouse gas goals by 2050.
CIFIA was created to finance projects that build shared (i.e., common carrier) transport infrastructure to move CO2 from points of capture to conversion facilities and/or storage wells. This CO2 transport infrastructure will provide economies of scale and help form an interconnected carbon management ecosystem in the United States.
Large common carrier CO2 transport infrastructure shares similar barriers to deployment previously faced by other types of critical national infrastructure, such as high capital costs, uncertain near-term utilization and returns as demand comes online, and chicken-and-egg challenges.
These barriers require federal, state, and local government support along with private sector investment to be overcome. CIFIA was created to address these barriers.
Is my project eligible?
An eligible CIFIA project must:
- Be a large-capacity common carrier CO2 transportation infrastructure project that transports CO2 captured from anthropogenic sources and/or ambient air by pipeline, shipping, rail, or other methods for storage and/or use.
- Have total project costs greater than $100 million.
- Be located in the United States.
- Publish, by project completion, a publicly available tariff with just and reasonable rates, terms, and conditions for nondiscriminatory CO2 transportation service.
- Have a reasonable prospect of repaying its CIFIA loan from project cashflows.
Are there other programs in DOE that can support carbon management projects that are not eligible for or not ready to apply to CIFIA?
While CIFIA is focused on deployment of carbon transport infrastructure, several DOE programs support research, development and demonstration of carbon management technologies.
Click here for a full suite of DOE’s 's carbon management programs and opportunities.
Click here for information on the federal 45Q tax credit for carbon capture, sequestration, and utilization.
What kinds of capital can CIFIA provide to an eligible project?
CIFIA’s $2.1 billion will be appropriated to DOE in annual increments between 2022 and 2026. The appropriated funds available to DOE at a given time can be committed to an eligible project in one of three ways:
To provide a loan to the project from the U.S. Treasury Department that is guaranteed by CIFIA credit subsidy funds appropriated to DOE.
To guarantee a loan from a non-federal lender using CIFIA credit subsidy funds appropriated to DOE.
To provide a grant under CIFIA as a cash payment to a project specifically for eligible costs to build additional transport capacity for potential future demand.
Both loans and loan guarantees must have a reasonable prospect of being repaid from project cash flows. Grants do not require repayment.
Learn more about CIFIA Growth Grants.
What value can DOE bring as a lender to my project?
- Access to Capital: Through CIFIA, DOE can provide access to debt capital for large-scale carbon transport projects. These kinds of projects can have difficulty accessing debt from private lenders because the common carrier CO2 transport market is in an early stage, CO2 transport infrastructure, like other forms of critical infrastructure, typically requires large upfront capital expenditures.
- Low Cost of Capital: Through appropriated credit subsidy from Congress, DOE is able to offer long-term, low-cost financing with interest rates equivalent to Treasury yield curves. DOE can also provide grants for eligible costs to build additional transport capacity for potential future demand.
- Flexible Approach: DOE can provide financing that meets the specific needs of individual borrowers. Under CIFIA, DOE can be the sole lender to a project or can co-lend with or guarantee loans from other public or private lenders. Additionally, DOE has the flexibility to structure deals to address the challenges of short-term demand and utilization uncertainty and chicken-and-egg challenges.
- Committed Partnership: DOE encourages early engagement during CIFIA project development so that DOE can take the time to dive deep and understand the project before an application is submitted. Even after loan closing, DOE remains a valuable partner to borrowers through project construction and operations.
- Established Expertise: DOE maintains an in-house team of financial, technical, legal, and environmental experts with expertise in carbon management projects and a variety of deal structures.
What kind of financial terms are available under CIFIA?
- CIFIA can provide loans and loan guarantees for up to eighty percent of eligible project costs,
- Pricing equal to U.S. Treasury-equivalent yield curve with zero credit spread, and
- Long-term tenors equal to the shorter of thirty-five years or the useful life of the asset.
See Section III of the CIFIA guidance document for more detail on CIFIA loan terms.
What is the process for obtaining a CIFIA loan or a loan guarantee?
Potential applicants are encouraged to engage directly with DOE for no-fee, no-commitment consultations to discuss their proposed project and learn about LPO's process before formally applying.
Click here to request a pre-application consultation.
See Section IV of the CIFIA guidance document for more detail on the CIFIA application process and see Section V for more detail on the CIFIA due diligence and approval process.
Are CIFIA applicants required to pay any fees?
A financing fee is due to the federal government from the obligor at financial close of the loan, loan guarantee, or grant. This fee will not exceed $3 million.
How does LPO treat confidential business information?
Refer to the Treatment of Confidential Materials fact sheet.
How can CIFIA funding interact with other LPO funding or support?
CIFIA loans cannot be drawn to finance the scope and/or phase of a project that is also financed through other federal assistance like grants or other LPO loans. However, the sources of funding can be sequenced such that CIFIA loans are drawn for later stages of deployment after other funds have already been dispersed (e.g., FECM-funded FEED study followed by CIFIA loan).
What will the required Community Benefits Plan consist of?
An Applicant’s Community Benefits Plan should explain how a proposed CIFIA project will support:
- Community and labor engagement
- Quality jobs
- Diversity, equity, inclusion, and accessibility
- Environmental Justice (as addressed through the Justice40 Initiative)
It should outline any work already done to-date by the project sponsor as well as forward-looking plans to be executed over the course of the project.
CIFIA GOVERNING DOCUMENTS
FOUNDATIONAL LEGISLATION, RULES, AND DOCUMENTS
Section 40304 of the Infrastructure Investment and Jobs Act (“IIJA”), Public Law 117-58, signed November 15, 2021, also known as the Bipartisan Infrastructure Law (“BIL”).
Certifications For Use with Applications for DOE Loans or Loan Guarantees Under CIFIA