Federal Spending Package Accelerates Carbon Removal: Statement
FOR IMMEDIATE RELEASE: March 11, 2024
Federal Government Spending Package Accelerates Carbon Removal: Carbon Business Council Statement
Federal lawmakers have approved a $460 billion spending package, which includes several carbon dioxide removal (CDR) provisions that will accelerate climate action. The Carbon Business Council (CO2BC), a nonprofit trade association of more than 100 carbon management companies, has issued the following statement in response. Additional details are below. The statement can be attributed to Ben Rubin, Executive Director, Carbon Business Council.
“The federal spending package is a continuation of America’s leadership in carbon removal. Creating permitting frameworks, unlocking tax incentives, and ensuring there is a demand for high-quality carbon removals will help to accelerate the market. We applaud the Biden Administration, U.S. Congress and Senate for including these bipartisan carbon removal provisions in the budget, which unlocks private sector innovation and investment. Carbon removal works in tandem with the important work of reducing emissions.”
The U.S. federal government has invested billions of dollars to support carbon removal with landmark bipartisan legislation. There are five key provisions in the federal spending package that will continue to accelerate carbon removal action through permitting, procurement, and tax incentives. A portfolio of carbon removal methods will be required to meet the nation’s climate goals, and the Carbon Business Council advocates for method-neutral policy to achieve this vital objective.
Carbon Dioxide Removal Prize: Federal funding includes $20,000,000 to continue the competitive carbon removal purchasing pilot program that was directed to be established in the fiscal year 2023’s Consolidated Appropriations Act. The U.S. Department of Energy launched the CDR Prize in 2023 with $35,000,000.
In-Situ Carbon Mineralization Sequestration: The federal funding package directs the U.S. Environmental Protection Agency to brief the Committee on the state of the science with respect to the use of in-situ mineralization, including injection into non-sedimentary basins and the use of carbon dioxide dissolved into water, as a qualified sequestration pathway under the Class VI Underground Injection Control [UIC] Program.
Federal Framework to Transition of UIC Class II Wells to UIC Class VI Wells: The U.S. Environmental Protection Agency is directed to provide a report to the Committees detailing a plan for consideration of guidance regarding the transition of UIC Class II wells used for long-term geologic storage of carbon dioxide to UIC Class VI wells under the existing regulatory structure.
Marine Carbon Dioxide Removal Regulatory Framework: The agreement recognizes the benefits of a clear regulatory process for marine carbon dioxide removal pathways and provides $250,000 to the Department of Energy’s Office of Fossil Energy and Carbon Management to work with other appropriate federal agencies and industry partners to develop, test, and evaluate ocean-based carbon dioxide removal technologies.
Amortization of Research and Experimental Expenditures: The funding includes restoration of the Internal Revenue Code (IRC) 174 (IRC 174) for same-year full deductibility of research and development (R&D) expenses (formerly modified by the 2017 Tax Cuts and Jobs Act). The Carbon Business Council and its membership strongly support this change, which will help early stage companies innovate, advance, and scale new commercial technologies.
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Carbon Business Council (CO2BC), a member-driven and tech-neutral trade association of companies unified to restore the climate, is the preeminent industry voice for carbon management innovators. Together, the nonprofit coalition represents more than 100 companies across six continents with more than $16.5 billion in combined assets.