Abby L. Harvey
GHG Monitor
11/20/2015
Sens. Rob Portman (R-Ohio) and Michael Bennet (D-Colo.) this week introduced legislation that would allow businesses to use tax-exempt private activity bonds (PABs) to finance carbon capture utilization and storage projects. The Carbon Capture Improvement Act would make PABs available to both power plants and industrial facilities interested in CCS retrofits. “We’ve developed a solution that will allow us to capture carbon, but also protect Ohio jobs. This is a commonsense idea and that’s why it’s supported by business groups, energy groups, and environmental groups alike. This is something that people on both sides of the aisle can get behind and I urge my colleagues to support this bill,” Portman said in a release.
The lawmakers emphasized the potential for companies to create additional revenue through the sale of captured CO2 for use in enhanced oil recovery. The use of CO2 helps build a business case for CCS while also improving national energy security by allowing for more of the nation’s oil needs to be met at home, they said. “It also reduces emissions from power plants and industrial facilities to help keep our air clean – which is something that Coloradans value and makes our state an attractive place to live. This bipartisan bill is a market-based, technology-neutral approach to attacking the problem that carbon dioxide creates,” Bennet said.
The release says using the PABs, companies can finance the entire cost of eligible carbon capture equipment, given that the project being financed would capture more than 65 percent of the covered facility’s carbon dioxide emission. If the project captures less than 65 percent of the facility’s carbon dioxide emissions, the PABs would be permitted on a prorated basis.
Proponents of CCS hailed the bill as a positive step toward decarbonizing the energy sector. “CCS is a crucial tool for reducing carbon emissions, and deploying additional projects will make it more affordable in the US and around the world,” Armond Cohen, executive director of the nongovernmental Clean Air Task Force, said in the release. “Private activity bonds can reduce the cost of financing projects, which will help lower the hurdles to getting more steel in the ground.”
