Coalition Statement on Inclusion of 45Q Extension in House Ways & Means Tax Package

Carbon Capture Coalition Director Brad Crabtree released the following statement today following the introduction of the Carbon Capture and Sequestration Extension Act and its inclusion in the Discussion Draft of the GREEN Act:

“The Carbon Capture Coalition would like to thank Representative Terri Sewell (D-AL) for her introduction today of the Carbon Capture and Sequestration Extension Act that provides for a one-year extension of the federal Section 45Q tax credit from January 1, 2024 to January 1, 2025. As an early advocate for expanding and reforming the 45Q tax credit that passed Congress last year, the Coalition recognizes Representative Sewell’s ongoing leadership in advancing carbon capture deployment, which will be essential for overall decarbonization efforts, both in the United States and worldwide.

The Carbon Capture Coalition also thanks Ways and Means Committee Chairman Richard Neal (D-MA) and Ways and Means Subcommittee on Select Revenue Measures Chairman Mike Thompson (D-CA) for their decision to include the 45Q extension in the Discussion Draft of the Growing Renewable Energy and Efficiency Now (GREEN) Act released today, and the Coalition looks forward to working with them on this important legislation.

The proposed one-year extension of 45Q is welcome and would restore one of two years already lost to ongoing delays in the U.S. Department of Treasury’s release of taxpayer guidance for 45Q from the Internal Revenue Service. However, the Coalition believes that the 45Q extension should be adjusted to match the five-year extension for other technologies in the Discussion Draft. Carbon capture projects are complex, capital-intensive and require long lead times for development; therefore, carbon capture project developers and investors need the longer planning and investment horizon and financial certainty that a five-year extension would provide, if carbon capture deployment is to achieve its full emissions reduction potential.

The Carbon Capture Coalition also sees significant potential for the ‘direct payment’ provision included in the GREEN Act to increase the ability of investors to monetize tax credits in support of commercial project deployment. The Coalition believes such treatment afforded to renewable energy tax credits under Sections 45 and 48 in the Discussion Draft should also be extended to Section 45Q because carbon capture technologies deserve the same tax monetization benefits.

The Coalition stands ready to work with Congress to ensure that the 45Q tax credit receives the same policy treatment as other important zero and low-carbon technologies in final tax legislation, so that carbon capture technologies can be fully deployed economywide to meet midcentury climate goals.”

-###-

For more information, contact:
Ben Finzel, 202-277-6286
[email protected]