Carbon capture tax credits are the central focus of a new bipartisan bill co-sponsored by Montana U.S. Sen. Tim Sheehy, a Republican, and Washington’s Sen. Maria Cantwell, a Democrat. The legislation, known as the Carbon Resource Innovation Act, aims to streamline access to tax credits for emerging carbon capture technologies. This initiative is part of the 45Q Carbon Tax Credit program, which incentivizes industrial emitters of carbon dioxide to capture emissions, alongside companies that focus on removing carbon directly from the atmosphere.
According to a press release from Sen. Sheehy’s office, companies developing new carbon capture technologies currently need to seek Congressional approval to qualify for carbon tax credits. Sheehy emphasizes the bill’s potential impact on wildfire management, stating, “As we continue to enact commonsense reforms to make our forests and communities more resilient against the growing threat of wildfire, it is critical we use the innovative technology and tools at our disposal to ensure proper fuels management.” He expressed pride in leading another bipartisan effort to protect landscapes, homes, and businesses from wildfire threats.
The release highlights several technologies excluded from current tax credits, such as Methane pyrolysis and Biomass Carbon Removal and Storage. Methane pyrolysis, which splits methane into hydrogen and solid carbon, has multiple industrial applications. However, the solid carbon is not covered under existing law, which focuses on gaseous forms. Biomass Carbon Removal and Storage transforms captured carbon dioxide into a carbon-rich solid or liquid for industrial use or storage in specialized vaults.
The press release notes that this bill will leverage undervalued carbon resources to create new revenue streams for American farmers and foster wildfire mitigation. By developing a market for low- and no-value materials, the bill aims to reduce disposal costs and enhance economic opportunities.
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