美国联邦CCS政策形势概述2021.pdf

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1、 Page|1 1.2 2.2 3.The Three Pillars of U.S.CCS Policy.3 3.1 CCS Research,Development and Demonstration(RD&D).4 3.2 CCS Market Development.4 3.3 CCS Infrastructure.4 4.A History of Enacted CCS Policy in the United States.5 4.1 1997:Department of Energy(DOE)Begins CCS RD&D.5 4.2 2005-2007:First Author

2、izations for DOEs CCS RD&D Program.5 4.3 2008-2009:First Significant CCS Market Development and Appropriations Legislation.5 4.3.a.CCS in The Energy Improvement and Extension Act of 2008.6 4.3.b.CCS in The American Recovery and Reinvestment Act(ARRA)of 2009.6 4.4 2018:45Q Reformed in the Bipartisan

3、Budget Act.6 4.5 2020:Energy Act Triples CCS RD&D Authorization Levels.7 4.6 2021:Final Treasury Department and IRS 45Q Guidance.7 5.Major CCS Bills Introduced in 2021.7 5.1 ACCESS 45Q Act H.R.1062.7 5.2 Carbon Capture Modernization Act S.661,H.R.x.7 5.3 Storing CO2 and Lowering Emissions(SCALE)Act

4、H.R.8995.8 5.4 Carbon Capture,Utilization and Storage Tax Credit Amendments Act S.x.8 5.5 Financing Our Energy Future Act S.x.,H.R.x.9 6.Discussion and Conclusions.11 References.12 Page|2 1.In the first three months of 2021,legislators in the United States House of Representatives and the United Sta

5、tes Senate introduced five bills that aim to accelerate the deployment of carbon capture and storage(CCS).This accomplishment is remarkable for several reasons:first,because of the depth and breadth of the policy provisions inherent in the bills;second,because all of the bills have bipartisan cospon

6、sors;and third,because of the speed with which the bills were released.From a political standpoint,it is noteworthy that these bills were introduced at all.Fresh off the passage of the Energy Act of 2020i a giant bill that effectively triples Congress yearly authorized spending levels for CCS Congre

7、ssional advocates chose not to coast after their big legislative accomplishment and instead doubled down on filling out the policy landscape with new bills aimed at the long-term growth of the CCS industry.Thus,CCS again shows evidence that it might be the only major climate change technology that e

8、njoys such a robust level of support from both sides of the aisle.The increase in both enacted and introduced CCS legislation over the past three years should encourage many more potential developers and investors to get serious about deploying CCS.This brief was born out of necessity,to keep track

9、of the five new CCS bills.It details both the contents of the bills and the rationale behind their policy proposals.It starts with a list of terms germane to U.S.policy,then follows by outlining the three broad categories(pillars)of CCS policy that support the entire CCS enterprise.Next,it gives a h

10、istory of major CCS policy provisions enacted into law and carried out by the U.S.government.This context is important to bring the reader into the present and helps frame the discussion of the current CCS bills introduced over the past three months.The last section concludes with a discussion of th

11、e current bills.This brief is intended to be useful to a global audience as a general primer on broad CCS policy themes affecting many countries in 2021.In this way,the U.S.CCS policy landscape can be viewed as a lens to magnify the challenges and opportunities that lie ahead for global CCS deployme

12、nt in the coming decades.2.Authorization What occurs when Congress passes a(non-appropriations)bill that is then signed into law by the President.The Bill authorizes or allows Congress to spend a certain amount of money on a stipulated project in a designated amount of time.The great majority of bil

13、ls introduced in Congress are authorization bills.If passed into law,they do not guarantee that funds will be spent.Appropriations The process of determining how much money Congress will spend on projects.Appropriations to fund the entire U.S.government are determined annually in the form of 12 appr

14、opriations bills that focus on the separate branches of government.The 12 appropriations bills are frequently Page|3 grouped together and passed as an omnibus piece of legislation.Separate appropriations(often done in emergency situations)can occur at any point.Introducing a Bill The act of formally

15、 submitting a piece of legislation for consideration by the entire House of Representatives or Senate.Bills can be introduced into either chamber or both at the same time.H.R.xxx Indicates a bill introduced in the House of Representatives.S.xxx Indicates a bill introduced in the Senate.Sponsor of a

16、Bill The member of Congress who formally submits a bill for introduction in either chamber and consequently the one who is listed first on the bill.Cosponsors of a Bill Sponsors of a bill who have their names added in support of the bill other than the first sponsor who formally introduced the bill.

17、Original Cosponsors are sponsors of the bill(other than the first Member)who sponsored the bill at introduction.Passing a Bill When the majority of both chambers of Congress vote to pass a bill which is then signed into law by the President.Once a bill passes one chamber,the bill transfers to the ot

18、her for consideration.Bills must be passed in identical form by both chambers before being transferred to the President for signing into law.Statutory Referring to the language contained in a public law passed by Congress and signed by the President.Rules and Guidance How Executive Branch department

19、s(e.g.,Department of Energy,Treasury Department or Internal Revenue Service)choose to implement and administer the statutory language in a passed bill.Typically,a department issues guidance and preliminary rulings that are open to public comment for 60 or more days before proceeding to the final rul

20、ing.Final Guidance The complete set of rules and regulations that apply to the administration of a tax credit or government funding opportunity.3.The Three Pillars of U.S.CCS Policy CCS policy measures implemented in the US.can be grouped in one of three distinct categories:1)Research,Development an

21、d Demonstration(RD&D),2)Market Development,3)Infrastructure.It is best to think of these categories as pillars because they work in tandem to support widescale CCS deployment;all three must be present in some form to fully undergird the enterprise.Page|4 Figure 1:A visual representation of the three

22、 pillars of CCS policy which support widescale deployment.3.1 CCS Research,Development and Demonstration(RD&D)From bench-scale research to large-scale demonstration facilities,CCS RD&D has historically been the first policy pillar to be constructed around the globe and has consequently provided the

23、most robust support for advancing CCS technology.Many governments are currently funding CCS RD&D programsii.3.2 CCS Market Development The Markets pillar includes any policy that supports the business case for companies to invest in CCS facilities.Examples of policies that fall under this category a

24、re tax credits,carbon prices,carbon trading markets,regulations and standards that require a certain amount of low carbon energy generation.3.3 CCS Infrastructure Infrastructure is the third pillar and encompasses policies that facilitate CO2 transportation,utilisation and underground storage.These

25、measures frequently involve regulations,permitting,licensing and citing as well as the creation of common carrier pipelines or other transportation routes.Like pillars that support an actual physical edifice,the stronger the pillar,the stronger the building it can support.Likewise for CCS deployment

26、,robust government investment in the CCS policy trifecta is necessary to achieve the 100-fold increase Page|5 needed to meet climate scenarios laid out by the Intergovernmental Panel on Climate Change(IPCC)iii.Individual facilities can and do exist apart from policy support,but in order to accelerat

27、e the deployment of CCS facilities and the growth of a truly global industry,all three policy pillars will need to be significantly strengthened.4.A History of Enacted CCS Policy in the United States Figure 2.Timeline of major CCS policy enacted in the U.S.4.1 1997:Department of Energy(DOE)Begins CC

28、S RD&D Most emerging technologies are fostered by RD&D policy support,and the same was true for CCS in the U.S.Though the first global CCS facility was erected in Terrell,Texas in 1972iv,Congress did not begin appropriating money for CCS RD&D in the DOEs Office of Fossil Energy until 1997v.Funding l

29、evels were small in the beginning,and it would take more than a decade before legislators would appropriate the requisite funds to achieve significant results from its fledgling CCS RD&D program.4.2 2005-2007:First Authorizations for DOEs CCS RD&D Program Congress passed the Energy Policy Act of 200

30、5 which provided a 10-year authorization roadmap for the DOEs CCS RD&D programvi.This blueprint was further enhanced with the passage of the Energy Independence and Security Act of 2007 which authorized seven large-scale demonstration projects that integrated capture,transport and storage.In the upc

31、oming years,appropriations would finally begin to match the ambitions of the authorized RD&D program.4.3 2008-2009:First Significant CCS Market Development and Appropriations Legislation Beginning in 2008,two significant pieces of legislation led to the major growth of CCS Page|6 deployment through

32、market development and RD&D support.The first was the passage of the Energy Improvement and Extension Act of 2008vii.The second was the passage of the American Recovery and Reinvestment Act(ARRA)of 2009viii to pull the U.S.out of the Great Recession.4.3.a.CCS in The Energy Improvement and Extension

33、Act of 2008 Tucked into the Energy Improvement and Extension Act are two provisions that established the second policy pillar(CCS Markets)in the U.S.The first provision authorized an additional$1.25 billion(adding to$1.3 billion previously authorized)for the Section 48A(48A)investment tax credit whi

34、ch was established by Congress in Energy Policy Act of 2005.With the passage of the 2008 bill,48A was modified to cover 30%of a developers investment in CCS retrofits that could capture and store between 65%and 75%of CO2 emissions from qualifying advanced coal and integrated gasification combined cy

35、cle facilitiesix.The second provision in the legislation created the Section 45Q tax credit(45Q)for carbon oxide sequestration(between 2008-2018 only applicable to CO2).At first glance,Section 48A would appear to provide a significant incentive for investing in CCS retrofits on coal fired power gene

36、ration,however it has never realized its full potential because of difficulties in the statutory language.When the legislation creating 48A was first enacted in 2005,the statutory language required certain efficiency standards for new and existing coal-fired plants to be able to realize the credit.W

37、hen the law was amended in 2008,the statutory language regarding the efficiency requirements was not updated,and these standards are impossible to meet for power plants that install carbon capture(though the emissions reductions from the retrofit would be greater than those of the efficiency standar

38、d)x.Unlike 48A,45Q remains a potent force to the present day,but its beginnings were humble.Between 2008 to 2018,45Q offered$10/tCO2 captured and stored via enhanced oil recovery(EOR)and$20/tCO2 captured and stored in geologic formationsxi.Both the 48A and 45Q tax credits will be revisited farther d

39、own in this brief.4.3.b.CCS in The American Recovery and Reinvestment Act(ARRA)of 2009 ARRA significantly advanced CCS RD&D by prioritizing large-scale commercial scale deployment.It appropriated$3.4 billion for CCS activities of which$2.65 billion was spent on nine large-scale demonstration project

40、sxii.Each of the nine projects received at least$100 million between 2009 and 2015.4.4 2018:45Q Reformed in the Bipartisan Budget Act Over the six years between 2011 and 2018,Congress allotted$4 billion in appropriations(not including the$3.4 billion in ARRA supplemental appropriations)to DOEs CCS R

41、D&D program an average of$571 million/yearxiii.Though annual appropriations for CCS RD&D at DOE have declined since those years(In FY2020,direct carbon capture or carbon storage programs were funded at around$250 millionxiv.),it was the reformation of the 45Q tax credit in the Bipartisan Budget Act

42、of 2018 that has breathed significant new life into the CCS value proposition.This bill raised the value of the 45Q tax credit to$35/tCO2 for EOR and non-EOR COx Page|7 utilisation and$50/tCO2 for COx secure geologic storagexv.(To read more about the current status of 45Q,read the Institutes Insight

43、,“45Q:The Most Progressive CCS-Specific Incentive Globally Is Now Open for Businessxvi.)4.5 2020:Energy Act Triples CCS RD&D Authorization Levels The passage of the Energy Act of 2020 xvii at the end of December gave CCS RD&D authorizations a dramatic boost back up to levels not seen since ARRA was

44、passed.In total,$6.72 billion was authorized for CCS spending between FY2021 and FY2025:$2.6 billion for six commercial-scale demonstration projects,$1 billion for large-scale pilot projects,$910 million for low-TRL level RD&D,$800 million for carbon storage,$447 million for direct air capture(DAC)R

45、D&D,$283 million for a carbon utilization program,and$250 million for FEED studies.4.6 2021:Final Treasury Department and IRS 45Q Guidance Three months ago,the Treasury Department and IRS issued their Final Guidance for the administration of the 45Q tax creditxviii.This Guidance provides certainty f

46、or CCS project investors and developers by establishing transparency about how to build a CCS project to achieve the full value of the reformed 45Q tax credit in a timely manner.5.Major CCS Bills Introduced in 2021 On 3 January,2021 the 117th Congress was sworn in.It includes the most closely divide

47、d House and Senate in decades.Yet,in the space of three months,this new Congress has introduced five major bipartisan bills to increase the deployment of CCS.5.1 ACCESS 45Q Act H.R.1062 On 16 February,Representative David McKinley(R-WV)and original co-sponsor Rep.Marc Veasey(D-TX)introduced the ACCE

48、SS 45Q Actxix.As its title suggests,the bill would amend 45Q to include a 100%direct pay option(cash payments in lieu of the tax deduction),a 10-year extension(end of 2035)of the commence construction deadline(the date when a project must break ground)to qualify for the credit and would also allow 4

49、5Q the same exception against the base erosion and anti-abuse tax(BEAT)as is enjoyed by wind and solar tax credits.(The BEAT is a form of alternative minimum tax for corporations to ensure multinationals cannot use deductions based off taxes paid abroad to reduce their US tax liabilities below a cer

50、tain threshold.)Currently,the ACCESS 45Q Act has five Republican and five Democratic cosponsors.5.2 Carbon Capture Modernization Act S.661,H.R.x This bill,introduced on 10 March,amends the statutory language passed in 2005 and Page|8 2008 to allow coal-fired power generation carbon capture retrofits