FEDERAL FEBRUARY 2021 POLICY Blueprint Policy Federal BLUEPRINT FEBRUARY 2021 1 Membership Participants Observers Accelergy International Brotherhood Algae Biomass Organization AFL-CIO of Boilermakers Biomass Power Association Air Liquide International Brotherhood Brown Brothers Energy Air Products of Electrical Workers & Environment, LLC AK Steel Jackson Hole Center Carbon Engineering Alto Ingredients for Global Affairs Carbon Utilization American Carbon Registry Jupiter Oxygen Corporation Research Council ArcelorMittal Lake Charles Methanol Chart Industries Arch Resources LanzaTech ClearPath Archer Daniels Midland Co. Linde, Inc. Cornerpost CO2 LLC Baker Hughes Mitsubishi Heavy Industries Enhanced Oil Recovery Institute, Bipartisan Policy Center America, Inc. University of Wyoming Calpine National Farmers Union Environmental Defense Fund Capital Power National Wildlife Federation Growth Energy Carbon180 NET Power LLC Institute of Clean Air Companies Carbon America New Energy Risk Melzer Consulting Carbon Wrangler LLC New Steel International, Inc. National Audubon Society Center for Climate NRG Energy Portland Cement Association and Energy Solutions Occidental Renewable Fuels Association Citizens for Responsible Energy Peabody Republic Services Solutions Forum Prairie State Generating Company School of Energy Resources, Clean Air Task Force Praxair, Inc. University of Wyoming Conestoga Energy Partners Shell Systems International | Core Energy LLC SMART Transportation Division The ZEROS Project DTE Energy (of the Sheet Metal, Air, Rail Tellus Operating Group EBR Development LLC and Transportation Workers) Waste Management Elysian Ventures Summit Agricultural Group World Resources Institute EnergyBlue Project Summit Power Group Energy Innovation Reform Project Svante GE Gas Power The Nature Conservancy Glenrock Energy Third Way Great River Energy Thunderbolt Clean Energy LLC Greene Street Capital United Mine Workers of America Impact Natural Resources LLC United Steel Workers ION Engineering LLC Utility Workers Union of America White Energy FEDERAL POLICY BLUEPRINT Table of Contents Preface 2 Introduction 2 The Federal Role in Commercializing Carbon Capture 3 The Administration and 117th Congress – A Critical Window for Carbon Capture 4 Carbon Capture’s Role in Addressing Climate Change 5 Carbon Capture as a Jobs Creator 6 Carbon Capture Benefits to Affected Communities 7 Looking Ahead: Reaching Economywide Deployment of Carbon Capture 7 Investment Certainty, Project Finance & Feasibility 8 Technology Deployment & Cost Reductions 12 Transport and Storage Infrastructure & Market Development 14 Jobs, Economic Development & Affected Communities 18 Conclusion 19 This Blueprint focuses on federal policy priorities. It Preface does not address state-level policies, which have an Members of the Carbon Capture Coalition (the important role to play in complementing federal policies Coalition) work together to achieve a common to support commercial carbon capture deployment. goal: economywide deployment of carbon capture, removal, transport, utilization, and storage. The mission of the Coalition is to reduce carbon emissions to meet midcentury climate goals, foster domestic Introduction energy and industrial production, and support a The United States leads the world in the high-wage jobs base through widespread adoption of commercialization of carbon capture, removal, carbon capture technologies. The Coalition supports transport, utilization and storage (or carbon the mission by advancing a comprehensive agenda capture), and there is broad bipartisan support for of federal policies and actions that will accelerate capturing and utilizing CO2 and CO. The U.S. has deployment of: 13 commercial-scale carbon capture facilities, with the capacity to capture about 25 million tons of CO • Capture of carbon dioxide (CO ) and carbon monoxide 2 2 annually, representing approximately half of the 26 (CO) from power plants and industrial facilities; commercial-scale carbon capture projects worldwide. • Carbon removal technologies, including direct air capture, bioenergy with carbon capture and storage To meet midcentury emissions reduction goals, preserve and create high-wage jobs and maintain and other advanced technologies that remove CO2 already in the atmosphere; U.S. technology leadership, a broad suite of enabling policies will be required to accelerate commercial • Transport infrastructure to carry CO from where it 2 deployment of carbon capture projects. is captured to where it can be geologically stored or put to beneficial use; Large-scale deployment of carbon capture is essential if we are to achieve the economywide decarbonization • Utilization of captured CO2 and CO to produce low- carbon fuels, chemicals, materials, and other useful necessary to meet midcentury climate goals. To limit products; warming to 2°C, the IEA estimates that the global carbon management industry will need to scale up • Storage of CO in secure geologic reservoirs, such 2 to well over 2,000 facilities capturing and storing as saline geologic formations and oil and gas fields. 2.8 gigatons (billion metric tons) of CO2 per year. The 2021 consensus Federal Policy Blueprint Deployment of carbon capture also provides a viable builds upon the Coalition’s original policy blueprint pathway for the decarbonization and continued released during the 116th Congress. It articulates a operation of key industrial, manufacturing and energy comprehensive and ambitious federal policy agenda facilities, thereby avoiding plant closures and the to help achieve the goal of economywide carbon offshoring of jobs and livelihoods. capture deployment and reflects the consensus In the three years since Congress revamped the federal policy priorities of the Coalition. It is not federal 45Q tax credit, project developers and intended to represent a complete compilation of all investors have announced over 30 carbon capture policies that are relevant and important to the broader projects. They span multiple industry sectors, electric carbon management agenda of carbon capture, power, transportation fuels, and direct air capture removal, transport, utilization, and storage. technologies. These approximately 30 publicly announced carbon capture projects represent an essential early down payment on long-term “Carbon capture” is used to deployment to meet midcentury climate goals. If reference the entire suite of carbon these projects all proceed to commercial operation, it will represent roughly a tripling of operating carbon management tools: capture, removal, capture projects in the U.S. Additionally, many more transport, utilization, and storage. projects under development have not yet been publicly announced. 2 Figure 1: Publicly announced carbon capture projects in the United States that are currently under development Seattle Blue Flint Ethanol Red Trail Fargo Blueprint Policy Federal Billings Energy* Project Tundra/ Minnkota Power ## # Boise City # Minneapolis Basin# Electric# # Boston # # Dry## Fork # # # # Sioux Falls # Madison # # Glenrock Summit Ag+ Clean Energy # Energy Detroit New York Systems # # Salt Lake # Chicago Pittsburgh City # # NE Public Des Moines # # Lincoln One Earth Energy* # Power / Ion* Alto Ingredients Columbus Washington San Francisco ## # Denver IL Clean # # Fuels Wabash Valley # Resource / OGCI Enchant / ### Svante, LH / # # CA Resources / ## Farmington # # # Louisville OGCI Oxy /Total # # Las Vegas Wichita# # # # # Prairie State ## Springfield # # # # Generating # # Knoxville Raleigh Los Angeles # Nashville # Tulsa # FEBRUARY 2021 # # # Albuquerque # # # # # # # # ## # # ### # ### Little Rock # # White Energy /## Oxy # ### Atlanta Charleston # ## Golden Spread ## # # # # # # # # # # ## Tucson Electric Coop* # # # # # # # # # # # # # # # Shreveport Dallas# # # Jackson Potential Geologic Storage # # # # # # # # # #Velocys / Oxy E 2 DAC One# Carbon # # F # + Engineering# / Oxy Mobile Systems Lake Charles Projects Under Development Capture Capacity Methanol# F International# # Houston# # # # # + F 1 # # ## Linde # # # # G2 Net Zero # # ## # LNG/NETPower ## + # Linde # ## # # # A Miami # F Note: Five additional projects under development are + * not pictured on this map due to confidential location. These announced projects span industry, power and direct air capture and will store CO2 in saline formations or in oil and gas fields. carbon capture, removal, utilization, and storage; the The Federal Role legislation also included reforms to the Department of Energy (DOE) loan program office, enabling DOE in Commercializing to draw on $8 billion in currently available funds to provide loans and loan guarantees to carbon capture Carbon Capture projects. Additionally, the Internal Revenue Service The landmark bipartisan reform and expansion of (IRS) finalizing the 45Q rulemaking in January 2021 the 45Q tax credit through passage of the FUTURE after a three-year delay,1 together with the 45Q Act in 2018, coupled with groundbreaking provisions extension, provides long overdue regulatory and in year-end energy legislation passed as part of the investment certainty to unlock billions of dollars in Consolidated Appropriations Act, 2021 (FY 2021 private capital for carbon capture projects, which can Omnibus), is foundational for commercial-scale now complete the planning, engineering, permitting deployment of carbon capture technologies. The and financing required to begin construction by the 2021 Omnibus featured an urgently-needed two- end of 2025