Capito, Heitkamp Announce Bipartisan Carbon Capture Technology Bill Signed Into Law
February 9, 2018|
U.S. Senators Shelley Moore Capito (R-W.Va.) and Heidi Heitkamp (D-N.D.)—along with Senators John Barrasso (R-Wyo.) and Sheldon Whitehouse (D-R.I.)—today announced that the FUTURE Act, their bipartisan bill to encourage technological innovation in carbon capture utilization and storage (CCUS) while also reducing carbon emissions, was passed by Congress as part of the bipartisan budget deal and was signed into law by President Donald J. Trump. Senator Capito worked with Senate leadership to ensure the bill was included the final budget agreement.
“The United States can and should be a leader in developing and exporting carbon capture systems, and extending and improving the 45Q tax credit will help us get there,” Senator Capito said. “Not only will this policy help drive economic growth domestically and reduce future emissions abroad, but it will also help our country fully embrace the kind of all-of-the-above energy strategy—including West Virginia coal and natural gas—we need to reach our full potential. I’m proud to have led this effort alongside Senator Heitkamp, and I am excited for the economic and environmental benefits it will encourage.”
“Power generators that want to maintain and preserve options for coal and natural gas as part of their energy portfolio cannot utilize the current Section 45Q tax credits. While carbon capture, utilization and storage has been established for some industrial processes, it is still a relatively expensive technology that is just being tested in commercial-scale power projects,” said Barbara Walz, co-chair of the Carbon Utilization Resource Council (CURC). “This bill provides the critical federal government support necessary to bring costs down and spur the development and deployment of CCUS projects.”
“This is not only a massively important win for U.S.-led clean and reliable energy but a product of tremendous bipartisan teamwork led by Senators Capito, Heitkamp and Barrasso,” ClearPath Action Founder Jay Faison said. “Their bipartisan leadership provides a template both for the commercialization of game-changing technologies that could sequester hundreds of millions of tons of CO2 and future collaboration in Congress to continue to give the U.S. a much-needed technological edge over China.”
The bipartisan legislation supports maintaining a place in our energy mix for existing resources like coal and natural gas by encouraging development and use of CCUS technologies and processes—while also spurring adoption of low-carbon technologies to transform carbon pollution into useable products. A wide cross-section of coal companies, utilities, environmental groups, and labor organizations support the bill, reinforcing a willingness from all sides to come together and seek bipartisan solutions.
The FUTURE Act extends and expands the 45Q tax credit to provide certainty to utilities and other industrial sources and would incentivize the build-out of industrial carbon capture projects that plan to use CO2 and CO for enhanced oil recovery and carbon utilization—the conversion of carbon dioxide into useable products. The 45Q provision is an integral part of the tax code for incentivizing carbon capture. Carbon capture cannot take off on a large scale unless there is federal support to encourage investment and implementation of the technology through tax credits and other mechanisms, which this bill would provide. The bill would also provide a crucial lifeline to coal miners by providing a pathway to maintain coal as a part of our diverse energy mix in a cleaner way and reinforcing bipartisan support for standing up for these workers and their communities.
In addition to extending 45Q, the bill strengthens support for carbon capture technologies by increasing the “commence construction” window for carbon capture projects from five to seven years and by increasing the number of years to claim the credits from 10 to 12 years.