Senators Keep Pressure on Treasury to Issue Carbon Capture Tax Credit Guidance
FUTURE Act implementation will reduce emissions and create jobs
Washington, D.C. – U.S. Senators Sheldon Whitehouse (D-RI), John Barrasso (R-WY), and Shelley Moore Capito (R-WV) today led a bipartisan group of colleagues in requesting guidance from the Department of Treasury for the implementation of the carbon capture utilization and storage tax credit program.
The Senators were lead sponsors of the bipartisan FUTURE Act, which will encourage technological innovation in carbon capture utilization and storage while reducing carbon pollution. The FUTURE Act became law well over a year ago, yet taxpayers remain unable to claim the revised credit. In a letter today to Treasury Secretary Steven Mnuchin, the Senators requested that Treasury issue an interim rule to allow carbon capture projects, which often have a long lead-time, to get underway and assign more staff to the development of the program.
“Implementation of this legislation is critical for establishing a domestic market for carbon to reduce emissions, create and preserve jobs, and drive further commercial deployment of carbon capture projects,” wrote the Senators.
The letter was also signed by Senators Joe Manchin (D-WV), Dick Durbin (D-IL), Chris Coons (D-DE), Kevin Cramer (R-ND), Tammy Duckworth (D-IL), Angus King (I-ME), and John Hoeven (R-ND).
Full text of the letter is available here and below.
May 20, 2019
Secretary Steven T. Mnuchin
Department of the Treasury
1500 Pennsylvania Ave., N.W.
Washington, DC 20220
Dear Secretary Mnuchin:
On February 6, 2019, the attached letter was sent to IRS Assistant Secretary David Kautter and Acting Chief Counsel William M. Paul to highlight the pressing need for regulatory guidance following the enactment of the FUTURE Act (PL 115–123, section 41119). Implementation of this legislation is critical for establishing a domestic market for carbon to reduce emissions, create and preserve jobs, and drive further commercial deployment of carbon capture projects. It has now been over a year since the bill’s passage and taxpayers remain unable to claim the revised credit.
Carbon capture projects need financial certainty up front due to long lead times for development and construction. It is imperative that developers have IRS guidance in the near term so project sponsors can demonstrate qualification for the credit as they seek private investment in a timely fashion before the January 1, 2024 tax credit commence construction deadline.
The Department of Treasury recently published a request for information (RFI) with a 45-day public comment period. This RFI lays the groundwork for a proposed rule and subsequent final rule, but we remain far from an updated, implementable credit framework usable for project developers and financiers.
We request that Treasury commit additional staff to the development of the final rule and the review of comments associated with the RFI and issue interim guidance so that project developers can utilize the tax credit without additional delay. We also request that you keep us apprised of your progress.
Thank you for your consideration and we look forward to your prompt attention to this request.
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