On November 3, the Carbon Capture Coalition submitted comments to the US Environmental Protection Agency (EPA) on the administration’s reconsideration of the Greenhouse Gas Reporting Program (GHGRP). If implemented as written, the EPA would eliminate reporting under the GHGRP for all 41 subparts of the program. This includes the four subparts relevant to carbon capture and storage technologies, immediately blocking taxpayers’ ability to elect 45Q, including those entities who are planning to claim the credit in the current tax year. The GHGRP and 45Q are intrinsically linked. Taxpayers are required to use Subpart RR of the GHGRP to validate amounts of carbon dioxide (CO2) securely stored in appropriate geologic formations for the purposes of electing the tax credit. According to EPA’s proposed schedule for implementation, 2024 would be the final reporting year under Subpart RR, thereby eliminating Subpart RR for those reporters in 2025 absent a viable alternative in place. Therefore, repealing Subpart RR of the GHGRP without a viable reporting mechanism in place would initiate an immediate chain of negative outcomes for the US carbon capture and storage sector. The GHGRP is mission-critical to the success of the American carbon capture and storage industry. The Coalition’s comment covers several negative implications this rule would have on the carbon capture and storage sector, the nationwide deployment of these technologies, and the American economy. The topics discussed include:
- The intrinsic link between the GHGRP and the section 45Q tax credit.
- Taxpayers’ reliance on 45Q to incentivize investment in the deployment of carbon capture and direct air capture technologies.
- The carbon management industry’s support for the GHGRP.
- The cost of reporting under GHGRP versus possible costs of reporting under third-party systems.
- Impacts of the proposed rule on those planning to claim 45Q in 2025.
- Repeal of relevant Subparts on US global competitiveness.
- Subpart RR’s role in demonstrating responsible stewardship of American taxpayer dollars.
With minimal cost and regulatory burden, relevant subparts of the GHGRP are enabling the production and sale of American-made energy and industrial products, particularly those derived from capturing carbon emissions from reliable, baseload power generation. The Coalition strongly recommends that EPA retain Subpart RR of the GHGRP, or at a minimum, delay the implementation of the repeal of Subpart RR until an alternative, commercially viable 45Q compliance mechanism is in place. The Carbon Capture Coalition looks forward to working with the administration and bipartisan members of Congress to find a workable pathway forward for the carbon capture and storage sector.
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The Carbon Capture Coalition is a nonpartisan collaboration of more than 100 companies, unions, conservation and environmental policy organizations, building federal policy support to enable economywide, commercial-scale deployment of carbon capture and storage technologies. This includes carbon capture, removal, transport, reuse, and storage from industrial facilities, power plants, and the ambient air.