Unanswered Questions Regarding Carbon Capture and Storage 45Q Tax Credits
The Science Roundtable on Carbon Capture and Storage awaits the Internal Revenue Service’s guidance on the 45Q tax credits. To maximize transparency and accountability, we need answers to the following questions to assess the net effect of subsidizing these carbon capture projects on reducing greenhouse gas emissions.
What emissions are produced by capturing and compressing the CO2? To assess net emissions reductions, we have to understand how much methane (“natural”) gas is burned to power carbon capture and storage and/or how much electricity is consumed, because these “process emissions” can offset much of the CO2 injected. For example, if a project burns “natural” gas to power CCS and enhanced oil recovery (EOR) processes and this combustion emits about half as much CO2 as is injected, then the net effect is half of what the company claims and half of what 45Q subsidizes.
How much is the U.S. spending to subsidize carbon capture and storage? The Treasury Department does not say how much it is spending, so we don’t know how much CO2 is actually getting stored and at what cost. Even the Congressional Budget Office does not know how much money is being spent and instead has relied on information from the Global CCS Institute, an industry promotion group to provide spending data.
Are CCS and EOR projects only required to report how much CO2 they bring to their site, not how much they ultimately leave in the ground? EOR works by injecting CO2, pumping much of it back up with oil, separating it from the oil and re-injecting it to produce more oil, continuing this cycle until the well stops producing oil. But do they re-inject all the CO2? What’s to stop a company from simply venting after the last oil production? There should be some mechanism to report how much is left in the ground, not just how much is put in the ground.
How many barrels of oil are produced for each ton of CO2 injected in subsidized carbon capture and storage and/or enhanced oil recovery projects?
What information about the source of CO2 is required to determine the net effect of a project on emissions? We need to understand how much of the CO2 produced at the source is vented and not injected. An important example is that much of the CO2 injected comes from “natural” gas processing, meaning 45Q subsidizes the production of “natural” gas. To calculate the net effect on emissions, we need information on both how much methane was produced and also how much geologic CO2 was brought to the surface with the methane — this indicates how much geologic CO2 was vented and how much CO2 is ultimately produced by burning the methane.