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With Green Energy, Louisiana Group Looks to Be Next Silicon Valley

The Future Use of Energy in Louisiana, a higher education, government and business consortium, is seeking a grant worth $160 million from the U.S. National Science Foundation. It now has only partial funding from Congress.

green energy
In 1901, the twin oil discoveries of the historic Spindletop well in Beaumont, Texas, and Louisiana's first successful well in a Jennings rice field paved the way for the growth of an energy industry that modernized the Gulf South.

More than 120 years later, a consortium of Louisiana colleges, universities, governments and businesses has hopes of being the catalyst for the next leap forward in energy, turning the state into a new “Silicon Valley” for the transition away from fuels and industrial processes believed to contribute to climate change.

Known as the Future Use of Energy in Louisiana, or FUEL, the new consortium will be funded primarily, at first, through what could be the largest grant ever offered by the U.S. National Science Foundation — $160 million over 10 years if the consortium meets its benchmarks and Congress fully funds the program.

Andrew Maas, an LSU associate vice president who helped lead the FUEL grant effort, said the creation of this transition could mean billions in new investment and jobs for the state. LSU officials cited projections that Louisiana's 250,000 jobs in the energy-related industries could double by 2050.

Since 2018, Louisiana has already seen nearly $60 billion in proposed capital investment tied to renewable or lower carbon-intensity projects, promising nearly 26,600 permanent jobs, according to the state Department of Economic Development. President Joe Biden's Inflation Reduction Act has opened up tax breaks and other incentives to further that development, White House officials said.

Some Louisiana workers in the industry, however, are in skeptical about the jobs figures, while some community and environmental activists question whether the transition would affect the environment in any meaningful way.

While long term, this transition could mean a shift to non-fossil fuel-based power and feedstocks, the short- and medium terms appear to be tied to the permanent storage of carbon dioxide underground and a firm reliance on fossil fuels, company executives and others who are part of FUEL said.

Federal tax credits are incentivizing carbon storage, but a proposal to do that under Lake Maurepas and similar plans in other parts of the state have already stirred opposition from local communities.

The proposals earned skepticism from environmental groups who see carbon capture as a self-serving plan to continue fossil fuel use without certain climate benefits. These groups argue more focus has to be placed on advancing renewables and that relying on the oil and gas industry to solve the problem simply is a fool's errand.

"It's like calling an exterminator who's going to bring rats to catch roaches. That's what they're doing," said Anne Rolfes, founding executive director of the Louisiana Bucket Brigade.


Erwin Gianchandani, assistant director of the NSF's Directorate for Technology, Innovation and Partnerships, said the Regional Innovation Engines program attempted to identify 10 areas in the nation that have competitive advantages to make major advances in new fields but have had historic under-investment.

He said the grant program has been trying to find self-re-enforcing ecosystems in the same way northern California's Silicon Valley is one for computer science and the Boston region's Kendall Square is one for biotech research.

Louisiana's long history with the oil, gas and petrochemical industries, its preexisting infrastructure and the Mississippi River give the state a prime ability to focus its blue collar, engineering and academic knowhow toward the energy transition, officials said.

"If we're thinking about energy transitions and want to make a meaningful commitment in that regard, there are few better places than Louisiana to be able to try to foster that and engineer that going forward," Gianchandani said.

The FUEL application to NSF, which had been in development for 18 months, won in a competitive awards process because of its collaborations among so many Louisiana universities, colleges and businesses in the energy sector, as well as critical worker training, the NSF official added.

Under the initiative, ExxonMobil, Shell Oil, Baker Hughes and many other companies will help the state's university researchers identify and then solve the technological challenges to make this transition happen.

This research can then foster real-world experimentation and application by companies in Louisiana, while startups would be incubated to take advantage of the gains, LSU's Maas explained.

If successful, new training programs at the state's community and technical colleges would ready workers for future industrial processes.

Universities and researchers behind breakthroughs would retain future patent and licensing rights, Maas said.

In addition to NSF, the Louisiana Department of Economic Development has pledged another $67.5 million over 10 years, but LSU officials say they have hopes the first batches of money will draw millions more in private sector investment.

"We want to take this $160 million in NSF money and leverage it into $500 million or $1 billion of impact to the state of Louisiana," Maas said. "We're not just going to take it and use it and be done with it. We need to keep investing into our ecosystem."

While Congress has authorized the full, 10-year NSF Engines program, it has funded only the first two years. Louisiana's FUEL consortium has been guaranteed $7.5 million annually for the first two years of the grant, an NSF spokesman said.

If the rest of the money comes from Congress and the consortium meets its goals, the FUEL group would receive $15 million annually for the next three years and $20 million annually for remaining five, the spokesman said.


During the news conference Tuesday at LSU, concerns the energy transition would continue to offer the high-paying blue-collar jobs that the oil and gas industry has provided for decades emerged in a question from a Lafayette-area television station reporter.

The officials responded with the projections for the powerful job growth the energy transition could mean for the state and assurances that most of these jobs would be similar to current energy jobs.

A few days later at the TNT Express gas station in Geismar in the heart of Ascension Parish's petrochemical belt, opinions were more mixed.

On a recent lunch hour, gas pumps and parking spaces were full with delivery trucks, vans and heavy-duty pickups as workers filed in to pick up to-go orders. Several workers said they weren't as worried about their jobs as they were skeptical that all the big talk at LSU would really amount to much.

Emry Slade, 49, of Walker, and Cleveland Wilkins, 45, of Baton Rouge, work together for one of the many companies that contract with the plants in the region. Theirs is a pipefitting and fabrication company.

Both men pointed out that the oil and gas industry has had more than a century to embed itself into just about everything. They didn't see how a transition away from the industry could happen any time soon.

As others outside TNT Express concluded, Slade and Wilkins were skeptical that the big dollars from the federal government would spur a real transition from fossil fuels but would likely amount to frivolous spending.

Slade pointed out that every time the federal government tightens rules on the oil and gas industry, he has more work to do to help facilities comply. Though those costs get passed on to the "little man," it's good for him, he said.

A few others said they recognized the problems climate change presents but also that their livelihoods depend on oil and gas. Dudley Gipson, 55, a Baton Rouge resident who works as an operator at an Ascension plant, said "the proof would be in the pudding."

"Everybody wants a better society. I mean a better place to live, but they also want to make sure that they can make a living to live in that world," he said.


Nationally, greenhouse gas emissions are most concentrated in the electrical power and transportation sectors.

Due to Louisiana's large industrial base relative to its population, the state's greenhouse gas emissions are uniquely concentrated in its manufacturing, comprising more than two-thirds of the total, according to former Gov. John Bel Edwards' Climate Initiatives Task Force.

John Flake, an LSU chemical engineering professor, said the potential exists to use electricity tied to renewables or even nuclear power to generate the heat and other energy needs of Louisiana's industrial base.

Remaining carbon dioxide emissions could be repurposed to create the feedstocks needed for their operations that are currently supplied by fossil fuels, he added.

Carbon capture will be an initial path to cut greenhouse gas emissions, he said, but "we can transition to using electrical energy to make all the products we make today."

Currently, though, electrical power for high heat needs can be several times more expensive than fossil fuels like natural gas.

Erik Oswald, vice president of policy development for ExxonMobil, said his company continues to see high demand for oil and gas and believes that carbon capture and sequestration would be an early phase of trying to cut emissions.

For the future, Oswald said, there's a technology race to see what advances can support the steps beyond sequestration at the lowest cost possible.

He cited the example of trying to pull carbon dioxide from the exhaust of power plants for underground storage. The gas concentrations are low, so the carbon dioxide is costly to remove and store. Finding a cheaper solution could lead to cuts in carbon emissions, he said.

"So the question for society is how do you work that problem at the lowest cost because people aren't going to work on the energy transition if they don't have affordable energy in their homes," Oswald said. "People are concerned with the lights going out."

Editor's note: This story has been updated to correct the spelling of Erik Oswald's name.

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