Emissions from power plants and other industrial facilities contribute hugely to climate change, but the actual gas escaping from their smoke stacks contains a much lower percentage of CO2 (coal plant emissions, for example are about 13% CO2), and the fact that that CO2 has to be first separated out from the other gasses makes it much more expensive to capture it and store it underground.īut raising the incentive to $85 per ton means projects that capture carbon dioxide from industrial facilities with lower CO2 concentrations, like natural gas processing facilities and cement plants, could become financially viable. Climate Policy and Change the Worldįormerly, the tax incentive, known as 45Q, only paid enough to convince investors to fund the easiest carbon capture projects, like pipelines to capture CO2 from ethanol processing facilities, which emit almost pure CO2 from tanks where corn is fermented into vehicle fuel. Read more: The Inflation Reduction Act Is About to Jumpstart U.S. “The fact that it actually came out in such a good form and actually came out is much better than we expected.” “The fact that actually happened isn’t a big surprise,” says Adrian Corless, CEO of CarbonCapture, a direct air capture startup. The new bill also simplifies the process for receiving those tax credits, and opens the subsidy to smaller carbon capture projects, which together essentially fulfill a full industry wishlist for new carbon capture legislation. Developers say that raising that incentive could tip many projects that once weren’t worth the investment over the financial finish line. The Inflation Reduction Act, which passed the Senate on Monday and is poised to pass the House on Friday, includes a dramatic change in a crucial tax credit for the carbon capture industry-increasing the government subsidy for capturing CO2 from polluting sources from $50 to $85 per metric ton. “We’re definitely going from a curiosity to a priority,” says Steve Lowenthal, chief commercial officer of Frontier Carbon Solutions, a carbon capture startup. Those provisions have the startups, investors, and legacy oil companies proposing to provide that service over the moon. But there are huge new rewards for high-emitting companies to pump their greenhouse gasses underground, and for facilities that propose to remove emissions directly from the atmosphere. Va.), there isn’t much in the way of consequences for big CO2 emitters in Democrats’ new climate bill.
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