Senate Finance Committee Chairman Max Baucus (D-MT) and Ranking Member Chuck Grasley (R-IA) introduced energy tax legislation that could possibly be moved before the Senate later this month. According to a summary, part of the legislation has a focus on clean coal and carbon capture and storage technology.
The bill would provide $2.5 billion in tax credits for advanced coal and gasification projects, $2 billion for advanced coal electricity projects and $500 million for coal gasification projects. To be approved for the legislation, a project must go through an application process. For an advanced coal project, the facility must capture and sequester 65 percent of the carbon dioxide emissions and for a coal gasification project at least 75 percent of the carbon dioxide emissions must be captured and sequestered to be eligible.
The bill provides a $10 credit per ton of CO2 captured that is then transported for purposes of enhanced oil recovery. This credit is available for the first 75 million metric tons at each facility. A $20 credit per ton of CO2 captured is given to the facilities that then transport the CO2 and sequester it in a geologic formation. To qualify for these credits a facility must capture at least 500,000 tons of CO2 annually.