Abby L. Harvey
GHG Monitor
5/9/2014
Sen. Jay Rockefeller (D-W.Va.) this week introduced two bills aimed at supporting the advancement of carbon capture and sequestration and enhanced oil recovery technologies. One measure, the “Carbon Capture and Sequestration Deployment Act,” is intended to encourage the development of CCS technologies through programs, tax credits and loan guarantees. Included in the bill is the Carbon Capture and Sequestration Innovation Program, which would authorize $1 billion over 15 years to fund a research and development program within the Department of Energy’s Office of Fossil Energy. The program seeks to support the development of demonstrations through government funding with a required 20 percent match by industry partners. The bill would also authorize $20 billion in loan guarantees to be used for the construction of new commercial-scale electric generation units or industrial facilities utilizing CCS technology; the retrofit of existing commercial-scale electric generation units or industrial facilities utilizing CCS technology; and the construction of CO2 transmission pipelines. Further, the bill would create a new investment tax credit covering 15-30 percent of the incremental cost of CCS equipment for facilities capturing at least 65 percent of CO2 emissions.
The second measure, the “Expanding Carbon Capture through Enhanced Oil Recovery Act” would modify and expand the Sec. 45Q Carbon Dioxide Sequestration Tax Credit, making the pool of credits available larger and, in an effort to ensure multiple projects can receive credits, the bill would also limit the amount of credits for any given project. Both measures would allow for the reservation of these tax credits for future use. This would address the uncertainty the current system causes. Under the current system credits are allocated on a first-come first-serve basis, which makes it difficult for business to take the credit into consideration when doing financial planning. Under the “Carbon Capture and Sequestration Deployment Act,” credits would also be made transferable to the company responsible for storing the CO2.
Rockefeller was an early supporter of CCS technology and has tried to move forward similar measures in the past. “The reality for West Virginia and the rest of the country is that we need coal; we can’t meet our energy needs without it,” Rockefeller said in a statement. “It is simply unrealistic to think that we can stop burning coal and shift to cleaner sources of energy instantly. And it is equally unrealistic to think that coal is as clean as it could be, or that it will be around forever. Either way, we have to prepare for the future.”
