House Budget Reconciliation Package Includes Transformative Carbon Management Provisions
October 28, 2021 | Legislation
The following statement can be attributed to Carbon Capture Coalition External Affairs Manager Madelyn Morrison:
“House Leadership unveiled their version of the budget reconciliation package today with much of its focus on investing in clean energy technologies and emissions reductions. If enacted together with the bipartisan infrastructure framework, this package would provide the most transformative and far-reaching policy support in the world for economywide deployment of carbon management technologies that are essential to meeting midcentury climate goals.
“This package rightfully recognizes carbon management as a key pillar of the Biden Administration’s climate agenda. The bill includes all of the Coalition’s top priorities. Going forward, any carbon capture, direct air capture or carbon utilization project beginning construction before January 1, 2032, will qualify for 45Q and will have the option of direct pay for the full value of the tax credit over the 12 years to claim the credit. The legislation also significantly boosts credit values to accelerate deployment, increasing the value of 45Q for industrial facilities and power plants that capture their carbon emissions to $85 per metric ton for CO2 stored in saline geologic formations, $60 per ton for the beneficial utilization of captured carbon emissions and $60 per ton for CO2 stored geologically in oil and gas fields.
“In addition, the bill also includes increased credit values for direct air capture technologies at $180 per metric ton for those projects seeking to securely store captured CO2 in saline geologic formations, $130 per ton for carbon utilization and $130 per metric ton for CO2 stored geologically in oil and gas fields.
“Finally, the bill takes a major step forward in expanding industry, electric power and direct air capture project eligibility by significantly lowering the annual CO2 capture thresholds for the 45Q program. This will expand access to the incentive for a wider range of carbon management technologies and applications, spurring further innovation and emissions reductions across multiple industries.
“These measures, coupled with provisions already included in bipartisan infrastructure legislation, are essential to decarbonizing hard-to-abate sectors and putting American industry on a path to net-zero emissions. This important legislation will provide a critical pathway to creating and retaining jobs that pay above prevailing wages, providing environmental and other benefits to communities, and safeguarding the long-term viability of America’s domestic industries.
“As negotiations between the House and Senate continue, Congress has the opportunity to deliver on net-zero and midcentury climate goals. The House budget reconciliation package could deliver an estimated 13-fold increase in deployment of carbon management technologies and between 210 and 250 million metric tons of annual emissions reductions by 2035.
“The Coalition’s more than 80 labor, NGO and industry partners will continue to work with members of Congress to ensure that the final budget reconciliation package and bipartisan infrastructure bill deliver on carbon management’s essential role in meeting our collective climate obligations, while retaining and creating high-wage jobs and fostering domestic energy and industrial production.”
The Carbon Capture Coalition is a nonpartisan collaboration of more than 80 businesses and organizations building federal policy support for economywide deployment of carbon capture, removal, transport, use, and storage. Our mission is to reduce carbon emissions to meet midcentury climate goals, foster domestic energy and industrial production, and support a high-wage jobs base through the adoption of carbon capture technologies. Convened by the Great Plains Institute, Coalition membership includes industry, energy, and technology companies; energy and industrial labor unions; and conservation, environmental, and energy policy organizations.