In February 2018, Congress approved the most significant pro-carbon capture and storage (CCS) national policy in a decade: a tax credit expansion for CO2 storage. Referred to as 45Q (for its section number in the U.S. tax code), the nearly tripled tax credit will provide substantial incentive for what the ethanol industry does with its CO2.
Many ethanol plants capture carbon dioxide and sell it to manufacturers or other users (enhanced oil recovery, carbonated beverages, medical uses, etc.). The new law is widely expected to stimulate the development of new CCS projects.
The three changes in the new law:
45Q provides a credit for CO2 sequestration and is available to taxpayers that capture qualified CO2 at a qualified facility and dispose of the CO2 in secure geological storage.
K·Coe Isom and our contacts can help assess the value of this opportunity, and make a determination of 45Q’s applicability on your business. Contact our ethanol business advisory team today – firstname.lastname@example.org.