$3.7 bn to kick-start the USA’s CO2 extraction industry

20 December 2022

The Biden-Harris administration, through the US Department of Energy has announced the launch of four programmes intended to help build a ‘commercially viable, just, and responsible carbon dioxide removal industry in the United States’. The programmes, funded with $3.7 billion from president Biden’s Bipartisan Infrastructure Law, will help accelerate private-sector investment, spur advancements in monitoring and reporting practices for carbon management technologies, and provide grants to state and local governments to procure and use products developed from captured carbon emissions. In tandem with strong action to reduce carbon emissions, large-scale deployment of carbon management technologies, including direct air extraction, are seen as crucial to addressing the climate crisis and meeting president Biden’s goal of a net-zero greenhouse gas emissions economy by 2050.

“No matter how fast we decarbonize the nation’s economy, we must tackle the legacy pollution already in our atmosphere to avoid the worst effects of climate change,” said US secretary of Energy Jennifer M Granholm.

In addition to this funding president Biden’s Inflation Reduction Act features substantial improvements to the federal Section 45Q tax credit for the capture and geologic storage of CO2, which will provide substantial complementary incentives. DOE’s analysis estimates that actions taken through the Act and the Bipartisan Infrastructure Law will drive 2030 economy-wide greenhouse gas emissions to 40% below 2005 levels.

Initiatives under the Bipartisan Infrastructure Law include a Direct Air Capture Commercial and Pre-Commercial Prize totalling $115 million to promote diverse approaches to direct air capture, with up to $15 million in prizes to incubate and accelerate research and development of breakthrough direct air capture technologies and up to $100 million for qualified direct air capture facilities: the announcement of a Regional Direct Air Capture Hubs programme, with investment of $3.5 billion from DoE to develop four domestic regional direct air capture hubs, each of which will demonstrate a direct air capture technology or suite of technologies at commercial scale: and Carbon Utilisation Procurement Grants, a programme that will provide grants to states, local governments, and public utilities to support the commercialisation of technologies that reduce carbon emissions while also procuring and using commercial or industrial products developed from captured carbon emissions.

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