Addressing Pipeline And Different Provide Chain Points Throughout The Transition To Cleaner Aviation Gasoline – Oil, Gasoline & Electrical energy

As industries transfer towards cleaner power sources, essential
sectors of the financial system—notably aviation—can’t
realistically be powered with electrical energy and should be powered by
cleaner bodily fuels, resembling sustainable aviation gasoline (SAF),
artificial “efuels,” hydrogen, and even ammonia.
Ahead-thinking firms in these sectors are working diligently
to safe more and more plentiful, inexpensive, and dependable provides
of those fuels in each the close to and long run with a view to usher in
the transition to a decreased carbon power financial system.

Regardless of the big challenges concerned, the aviation {industry}
has proven extraordinary management in transitioning to sustainable
sources of gasoline. There may be an ongoing debate as to the perfect clear
gasoline in the long run. Nevertheless, most agree that within the shorter
time period, probably the most sensible choices are SAFs and efuels. Since these
two fuels are hydrocarbon replicas of standard gasoline, they will
function direct “drop-in” replacements to gasoline present
plane. In contrast, hydrogen and ammonia are chemically
totally different from hydrocarbon fuels. Though they’ve been confirmed as
possible fuels for plane, their use would require a special
plane design or at the very least vital modification of present
plane.

The transition to sustainable fuels will entail a transforming of
provide chains, together with the pipelines presently used to move
aviation gasoline. The authorized and regulatory panorama for each the
improvement of fuels and the transportation provide chain is the
topic of great uncertainty and debate, and few people
are consultants within the related regulation. At present, aviation gasoline is
predominantly produced from crude oil and transported in pipelines
carrying different refined petroleum merchandise, that are topic to the
Federal Power Regulatory Fee’s (FERC) regulation underneath
the Interstate Commerce Act (ICA). As soon as made, SAF and efuels will
additionally have to entry pipeline infrastructure (regulated underneath the
ICA) to achieve their shoppers. Hydrogen, which is already used to
produce standard fuels, will probably be required in better
abundance to supply sustainable options.¹ As
hydrogen begins to be sourced extra usually from renewable sources
(somewhat than produced onsite from pure gasoline), extra transportation
infrastructure shall be wanted to move this hydrogen from its
manufacturing location to the vacation spot of finish use.²
Pipelines may additionally be wanted to move carbon dioxide each for
sequestration of that carbon dioxide and as a feedstock for power
merchandise, together with efuels.³ There may be uncertainty and
debate as to how pipelines carrying hydrogen or carbon dioxide are
regulated underneath present regulation.

Venable’s Power Group is on the forefront
of those authorized and coverage points. Venable’s Power Group has
lengthy represented the aviation industries and others in transporting
each crude inputs and completed fuels in pipelines regulated by FERC
and state companies. The Power Group can also be a pacesetter within the
ongoing authorized and coverage debate concerning the regulation of pipelines
transporting hydrogen, carbon dioxide, and biofuels. This 12 months
alone, Venable attorneys have testified earlier than a Senate Committee,
debated in affiliation occasions, and revealed peer-reviewed articles
on these subjects.⁴ Venable’s coverage group labored to
safe key tax provisions within the Inflation Discount Act, and
Venable’s attorneys have suggested shoppers on potential hydrogen
manufacturing tasks and represented renewable gasoline producers in
their disputes with pure gasoline pipelines. Venable’s Power
Group acknowledges that each one these points are altering and
inter-related and are able to advise shoppers as they confront
these and different points associated to the brand new decarbonized power
financial system.

Footnotes

1. William G. Bolgiano, FERC’s Authority to
Regulate Hydrogen Pipelines Beneath the Interstate Commerce Act,
43 Power L.J. 1, 11, 71-72 (2022) (“Hydrogen
Pipelines“).

2. Id. at 13-16.

3. Richard E. Powers, Jr., et al., Hydrogen
Manufacturing and Carbon Sequestration Might Require the Floor
Transportation Board to Make clear Jurisdiction over Carbon Dioxide
Pipelines, Venable LLP (Nov. 18, 2022), https://www.venable.com/insights/publications/2022/11/hydrogen-production-and-carbon-sequestration.

4. Listening to to Study Federal Regulatory Authorities
Governing the Improvement of Interstate Hydrogen Pipelines,
Storage, Import, and Export Amenities, Earlier than the S. Comm. on
Power & Nat. Res., 117th Cong. (July 19, 2022) (Written
Testimony of Richard E. Powers, Jr.), https://www.power.senate.gov/companies/information/542E24C8-F2A2-4483-869F-1201C6E7D9FD;
Wealthy Reidorn, Jr., Attorneys, Trade Debate Path for Hydrogen
Regulation: Pure Gasoline Act, Interstate Commerce Act or New
Regulation?, RTO Insider (Oct. 16, 2022), https://www.rtoinsider.com/articles/30955-lawyers-industry-debate-path-hydrogen-regulation;
Bolgiano, Hydrogen Pipelines.