Carbon Removal Takes Major Step Forward: Statement
FOR IMMEDIATE RELEASE: August 16, 2022
Inflation Reduction Act Increases Tax Incentives for Carbon Removal and Allocates Billions of Dollars to Support Growth: Carbon Business Council Statement
President Biden has signed the Inflation Reduction Act, the largest investment in climate in U.S. history. The Carbon Business Council, a nonprofit trade association of more than 50 companies committed to the economic and responsible growth of carbon management, has issued the following statement in response to the IRA. The statement can be attributed to Ben Rubin, Executive Director.
“The pathway to gigaton scale carbon removal takes a major step forward with the passage of the Inflation Reduction Act, which increases the tax incentive to remove, utilize, and store carbon dioxide. The Carbon Business Council is pleased that updates to the 45Q tax incentive will increase eligibility for more carbon management startups. Embracing a tech neutral approach on the implementation of the Inflation Reduction Act will help to ensure that a portfolio of carbon removal solutions moves forward. The Carbon Business Council thanks everyone who made the Inflation Reduction Act a reality.”
The IRA increases 45Q tax incentives for carbon removal, from $50 a ton to $130 a ton for utilization and $180 for storage and direct air capture. The IRA also adds a direct pay option for 45Q and adjusts the size qualification, which streamlines the process for carbon removal companies and increases eligibility for startups. The IRA invests $20 billion in conservation programs at the U.S. Department of Agriculture, which can help advance carbon storage. The IRA provides billions of dollars in grants for the conservation and restoration of forests. The IRA’s $5 billion appropriation to the Loan Program Office enables the office to issue guarantees on project loans up to $250 billion. The IRA is projected to reduce emissions by as much as 40% by 2030. IRA follows the passage of the CHIPS Act, which provides $1 billion in funding to carbon removal RD&D.
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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 startups.