|WASHINGTON, D.C. — This week, Representatives David B. McKinley, P.E. (R-W.Va) and Terri Sewell (D-AL) reintroduced the Carbon Capture Modernization Act, which will advance carbon capture technologies at coal plants. |
This legislation would modernize the 48A tax credit’s requirements to make it easier for businesses to receive the tax credit based off of the capabilities of existing technology. This will help promote the adoption of carbon capture and sequestration (CCS) technology and reduce emissions.
“Modernizing the 48A tax credit will make it easier for businesses to retrofit coal facilities around the nation with carbon capture technologies,” said McKinley.
“The damaging impacts of carbon pollution in Alabama and across our country demonstrate the need for a holistic approach to our environmental goals, and carbon capture technology is a necessary tool as we push for a clean energy economy,” said Sewell.
The Section 48A tax credit was first established in 2005, and carbon capture projects were made eligible in 2008. However, the eligibility standards for the credit are not technically or economically feasible for carbon capture and storage (CCS) retrofit projects.
When Congress modified this provision in 2008 to include existing coal power plants, they also imposed a new requirement to capture and store at least 65% of the CO2 in order to be eligible for the tax incentive. This requirement is too stringent and unrealistic for retrofit applications. Due to these unattainable requirements nearly $2 billion worth of credits have gone unused.
Joining Reps. McKinley and Sewell as original cosponsors are Representatives Kelly Armstrong (R-ND), Liz Cheney (R-WY), Carol Miller (R-W.Va), Alex Mooney (R-W.Va), Pete Stauber (R-MN), and Marc Veasey (D-TX).
The Senate companion version to the Carbon Capture Modernization Act was introduced by Senators John Hoeven (R-ND) and Tina Smith (D-MN) with Senators Kevin Cramer (R-ND), Joe Manchin (D-W.Va), John Barrasso (R-WY), Jon Tester (D-MT), Steve Daines (R-MT) and Shelley Moore Capito (R-W.Va) joining as original cosponsors.
“North Dakota’s energy producers are leaders in carbon capture and sequestration. Removing barriers to implementing this technology will lead to more widespread adoption by producers. I am proud to support this bill with Senator Hoeven and Representative McKinley to help spur more use of carbon capture technologies and preserve the future of our energy resources for generations,” said Armstrong.
“In Wyoming, we understand how crucial carbon capture and storage technology is to our overall energy production efforts. Through this innovation, we can continue to take advantage of our abundant coal resources that create affordable energy options for families in a responsible way. I’m proud to co-sponsor this legislation that will modernize the 48A tax credit’s performance and efficiency standards to reflect the capabilities of existing technology, which will promote the adoption of this critical innovation,” said Cheney.
“Carbon Capture is a revolutionary technology that is ushering natural resource production into the 21st century” said Miller.
“This legislation will incentivize investment in this technology to provide high quality energy jobs to the people of West Virginia for years to come.” “I am proud to once again be an original cosponsor of the Carbon Capture Modernization Act. This legislation will help existing coal plants qualify for a tax credit to help finance the construction of new carbon capture technologies. These improvements will help extend the life of our coal-fired power plants, ensure reliable energy during extreme weather and protect West Virginia energy jobs,” said Mooney.
“Not only will the Carbon Capture Modernization Act save and create jobs, but it will aide in our efforts to reduce emissions,” said Veasey.
“As determined by the International Energy Agency, carbon capture, utilization, and storage (CCUS) will be a critical component in the electricity system of the future, ensuring continued reliable, dispatchable power generation and reducing emissions. The Carbon Capture Modernization Act will be instrumental to deploy first mover carbon capture projects on existing power plants by making critical technical changes to the existing tax credit program, which will unlock nearly $2 billion in tax credits to be allocated as Congress intended – to invest in carbon capture to significantly reduce emissions from electric power facilities. When combined with the Section 45Q tax credit, the revised Section 48A tax credit will enable financing for carbon capture projects and propel a robust CCUS industry in the United States. CURC applauds Senators Hoeven and Smith and Representatives McKinley and Sewell for their leadership on this bipartisan, bicameral bill,” said Shannon Angielski, Executive Director of the Carbon Utilization Research Council.
Modernizing the 48A tax credit will make it easier to adopt carbon capture and sequestration technology in coal facilities