Harvestone Low Carbon Partners (HLCP) has secured a significant financial milestone with the closing of a $205 million tax equity financing deal with Bank of America. This deal, the first of its kind since the passage of the Inflation Reduction Act (IRA), will support HLCP’s biofuel carbon capture and storage project in North Dakota. The Inflation Reduction Act, enacted by the U.S. government in 2022, allocated nearly $370 billion to support renewable energy and industrial decarbonization initiatives through various tax credits, loans, grants, and subsidies. A key component of this legislation is the updated “45Q” tax credit, which now offers $85 per ton of carbon emissions captured and stored from industrial facilities. This credit, along with extensions to its claim timeline and the ability to transfer it to outside investors, aims to accelerate the adoption of decarbonization technologies. Harvestone, based in North Dakota, operates three corn-based dry-mill ethanol facilities, producing approximately 220 million gallons of ethanol annually. Its Blue Flint biorefinery, with a capacity of 73 million gallons per year, is at the forefront of carbon capture technology in the U.S.
This facility began carbon capture and sequestration (CCS) operations in October 2023, making it one of the first to implement such measures. The CCS infrastructure captures biogenic CO2 emissions from the ethanol production process, compresses the gas into a liquid, and injects it into a deep underground geologic formation for storage. To date, the Blue Flint facility has captured over 125,000 metric tons of CO2 and aims to capture more than 200,000 tons per year. Jeff Zueger, CEO of HLCP, highlighted the positive impact of the CCS project: “Blue Flint’s carbon capture and sequestration project has helped the facility dramatically reduce emissions, produce ethanol with a significantly lower carbon intensity score, and strengthen the ethanol and agricultural markets for North Dakota.” Under the new financing agreement, Bank of America will invest $205 million and participate in the 45Q tax credits associated with the CCS infrastructure at Harvestone’s facilities. The bank also has the opportunity to purchase tax credits for the clean fuel produced by the biorefinery. Karen Fang, head of global sustainability finance at Bank of America, emphasized the bank’s commitment to innovative financing for carbon-reducing technologies: “We have built a strong track record for innovative financing for carbon reduction technologies, including carbon capture and sequestration, join all of our customers, including partners like Harrowstone, and provide them with a full suite of financing solutions. to meet their needs as they transition to eternal life.”