Monday, May 27, 2024

DOE unveils a second chance to access $6 billion for carbon capture tech

Must read


Carbon capture and storage (CCS) is a major tool the Biden administration is taking advantage of to help accelerate the country’s decarbonization. 

Policies like the Environmental Protection Agency’s power plant rules requiring fossil fuel power plants install carbon capture and sequestration/storage (CCS) technology or shut down by 2039 and the newest round of funding for industrial decarbonization projects from the DOE are only the most recent examples of how the government is subsidizing the marketplace.

Last month, the Internal Revenue Service, Department of Treasury and Department of Energy (DOE) released additional guidance regarding the nearly $6 billion available in the Qualifying Advanced Energy Project Credit Program (48C).

Recipients from the first round of funding held in 2023 were contacted in March, with $4 billion in credits granted to over 100 projects across 35 states. 13 percent of the projects selected — totaling $500 million in tax credits — were for those classified as ‘industrial decarbonization.’  

The 48C tax credit is available to any industrial facility trying to decrease emissions by a minimum of 20 percent.

“Any facility that is retrofitting an industry or manufacturing facility is [eligible for the 48C tax credit],” said Sarma Kovvali, program manager with the DOE. “The industry examples can include cement, iron, steel, aluminum, chemicals, food and beverage, the whole gamut of industries.” 

The 48C tax credit is distributed by the IRS, a distinction Kovvali emphasized.

“The IRS makes the allocation decisions, and within two years, [projects] have to certify that they got the referred permits and are ready to start the construction,” said Kovvali. And in the following two years, the facilities or mitigation technologies have to be up and running to receive their designated financial credits.  

Details on 48C opportunities

There are some qualifications companies must meet to receive the 48C tax credit. These include:

  • Projects must expand clean energy manufacturing, recycling and critical materials refining, or reduce greenhouse gas emissions at industrial facilities.
  • Projects installing CCS technology must be retrofitting existing facilities. New developments will not receive any tax credits.
  • Any CCS technology or other emissions reducing technology must remove a minimum of 20 percent of greenhouse gases.

“Some of the categories that [the DOE encourages] are zero-carbon process heat systems — those that are combined heat and power systems — and…the carbon capture, transport, utilization and storage systems,” said Kovvali.

Concept papers for prospective projects are due via the 48C ECO Portal by May 28. DOE is hosting an informational webinar regarding the tax credit and application Thursday, May 16 at noon ET.

[Continue the conversation on climate policy at Circularity 24 (May 22-24, Chicago), the leading conference for professionals building the circular economy.]



Source link

More articles

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest article