Carbon Management Policy Progress Update and 2022 Preview

January 27, 2022 | Blog

“After a year that has seen a historic virus, floods, hurricanes, droughts, temperatures… the need for climate action is now,” remarked President and CEO of the National Wildlife Federation, Collin O’Mara at the Carbon Capture Coalition’s January media briefing. O’Mara further reflected that the 45Q tax provisions are fundamental to reaching our net-zero emissions goals.  

O’Mara was joined by representatives of two additional Carbon Capture Coalition members — the United Steelworkers and LanzaTech — whose organizations are broadly reflective of the Coalition’s more than ninety industry, labor, conservation, environment and energy policy organizations. At the briefing, Coalition staff and members provided insights on key carbon management policy achievements from 2021, as well as a preview of top legislative priorities for the Coalition over the coming year.  

Looking back to 2021, the recently enacted Infrastructure Investment and Jobs Act provides $12.1 Billion for carbon management, a historic investment in ensuring these technologies can commercialize over the next decade to meet midcentury climate goals. Additionally, last year saw major progress on key enhancements to the 45Q tax credit, which are necessary to close the cost gap on deployment of carbon capture technologies across key sectors including steel, cement, refining as well as power generation.

Jessie Stolark, Public Policy & Member Relations Manager for the Carbon Capture Coalition, highlighted in opening remarks that “getting these necessary 45Q tax enhancements across the finish line is a top coalition priority for 2022.”  

Madelyn Morrison, External Affairs Manager for the Coalition drove this point home, noting that Coalition members have been very focused on policies to decarbonize the hardest to abate sectors, noting, “As currently designed, very little carbon capture deployment will occur in certain sectors simply due to the greater cost of capturing CO2 and commercial risk. With that said, the Senate’s latest iteration of Build Back Better provided increased credit values for sectors with the highest capture costs in an attempt to close that gap.”

This blog post provides highlights from Coalition members’ remarks and discussion along with the full event recording below.

Carbon Capture Coalition Virtual Media Briefing – January 19, 2022

Collin O’Mara  

President and CEO, National Wildlife Federation 

O’Mara urged the group to consider the need for climate action and the consequences of inaction. “There is no solution to get to net zero without carbon capture technology,” he stated.  

And for carbon capture technology to be successfully deployed, he asserts that the 45Q tax credit is absolutely key. “The very most important policy, in the industrial sector in particular, in the entire package is the tax credit under 45Q… if we’re really going to realize the promise of Carbon Capture Technology, it is absolutely essential that the tax credits are passed, and they continue to get better and better.” 

Concluding his speech, O’Mara reaffirms the commitment of the National Wildlife Federation to policy engagement saying, “We’re absolutely committed, at the National Wildlife Federation, to making sure that the carbon capture tax credits under 45Q are both robust; that they are extended for the full ten-year frame; that they are written in a way that investments flow from the private sector as well as having that direct pay to make sure that the impact is maximized on the landscape.”

Anna Fendley

Director of Regulatory and State Policy, United Steelworkers 

Recognizing the importance of this moment in national policy, Fendley notes the employment and economic impacts and opportunities promised through the deployment of the suite of carbon management technologies. She says, “We are really at a pivotal moment. We are finally at a point where we have the possibility to make this a different story, especially for the industrial sector. We have real potential to: retain jobs in industrial sectors like steel and cement and refining and chemicals; we have a real opportunity to invest in the long-term viability of our industrial base which is so important to our economy; and we have the opportunity to create jobs in the installation of this technology and the build out of the associated infrastructure.” 

Restating the commitment of the United Steelworkers to engagement on decarbonization-relevant policy, she concludes, “45Q enhancements are a key priority for our union and for labor and for energy and industrial unions generally because it will be another big step forward in helping to make Carbon capture technologies more in reach for industry looking to decarbonize.”

Tom Dower 

Vice President Public Policy, LanzaTech 

Contemplating foreseeable industrial impacts and opportunities related to carbon capture, Dower says, “The question that we bring to the table is ‘where should carbon come from?’ And we believe that carbon can come from above the ground in the form of captured carbon emissions from industries, directly from the air through direct air capture; and from waste such as agricultural, forestry, municipal solid waste. And we can convert those into the products that are needed today in existing supply chains.”

Dower further echoed that carbon management (carbon capture, removal, transport, utilization and storage) are key to reach climate goals saying, “Every economy-wide and global emissions reduction model looks at the various carbon abatement options and the results have been very clear, in order to meet the 2 degree or 1.5 degree scenarios, carbon capture, utilization, and storage is a key part of the puzzle. Importantly, without CCUS deploying, those models show significantly higher cost of carbon abatement, on the order of double the cost to society in many cases. So, bringing that to the U.S. context, we need the Build Back Better Bill and swift implementation of the Infrastructure Investment and Jobs Act to accelerate the transition to a truly sustainable economy.”