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1 1 (February 21, 2020)

handle is hein.crs/govcadw0001 and id is 1 raw text is: FF. ' iE SE .r, & , Updated February 21, 2020 Carbon Sequestration Legislation in the 116th Congress Utilizing permanent underground storage of carbon dioxide (CO2), also known as geological sequestration, as a potential strategy to reduce net greenhouse gas (GHG) emissions is receiving increasing congressional attention. Proponents of geological sequestration of CO2 view the process as a promising method of reducing GHG emissions from stationary sources, such as coal-fired power plants, while continuing to use fossil fuels as a source of electricity. Several bills introduced in the 116th Congress would address geological sequestration policy issues, focusing on federal research and development (R&D) and federal tax credits for storing carbon. Geological sequestration of C02, a type of carbon storage, is the process of storing CO2 by injecting it into an underground geological formation. Geological sequestration is the final step in a carbon capture and storage (CCS) system sometimes referred to more expansively as CCUS (carbon capture, utilization, and storage). Geological sequestration is intended to trap CO2 emitted from anthropogenic sources permanently underground and reduce net emissions of this GHG into the atmosphere. CO2 can also be stored underground when injected as part of oil and gas production (called enhanced oil recovery, or BOR). In a CCS system, CO2 is captured from a stationary source, compressed into a fluid to allow for transportation by pipeline, and then injected through specially designed wells into geological formations typically a half a mile or more below the Earth's surface. An emerging technology to capture CO2 directly from the atmosphere direct air capture (DAC) could also serve as a source of CO2 for geological sequestration. Subsurface geological formations across the United States could be suitable for large-scale sequestration of CO2. These include, for example, deep saline reservoirs (underground basins containing salty fluids) and oil and gas reservoirs no longer in production. CO2 may also be sequestered offshore in deep ocean waters or under the seabed. When injected deep enough underground, high pressures combined with impermeable rocks above the target formation are expected to keep the CO2 from migrating upward into shallower groundwater or into other geological formations. For additional information on the technical aspects of CCS, see CRS Report R44902, Carbon Capture and Sequestration (CCS) in the United States, by Peter Folger. Over the last decade, the focus of federal R&D efforts for geological sequestration has shifted from small demonstration projects to exploring the use of sequestration as a technically and commercially viable method for storing large volumes of captured CO2. The U.S. Department of Energy (DOE) leads the federal government's R&D efforts in geological sequestration of CO2 as part of the agency's fossil fuel programs. DOE's work includes conducting fundamental laboratory research on wells, storage design, geological settings, and monitoring and assessment of the injected CO2. DOE also sponsors numerous geological sequestration testing and validation projects through partnerships with the petroleum and chemical industries and public and private research institutions. To date in the United States, nine R&D projects have injected CO2 into underground formations in large-scale field tests of permanent geological sequestration and storage associated with EOR. Four of these projects are currently injecting and/or storing CO2. Some Members of Congress have introduced legislation intended to support geological sequestration R&D. (See Table 1 for a list of legislation introduced in the 116th Congress.) Several bills S. 383/H.R. 1166, S. 1201, and H.R. 3607 would enhance DOE's work in supporting geological sequestration through continuation and/or expansion of its CCS programs, including carbon storage programs. These bills would amend current statutes to direct DOE to develop and implement R&D programs related to geological sequestration methods, storage siting, and assessment of potential impacts. S. 1201 and H.R. 3607 would also direct DOE to continue its partnership programs for large-scale sequestration demonstration projects. S. 383/H.R. 1166 and S. 1201 would require reports to Congress, such as a report from DOE on saline reservoir storage and a report from the Council on Environmental Quality on ways to facilitate development of CCS projects. Legislation addressing federal tax credits for carbon storage is receiving significant industry attention. Two bills in the 116th Congress H.R. 5883 and S. 2263 would address these tax credits (see Table 1). H.R. 5883 would increase the tax credit for DAC facilities, remove the deadline for beginning construction of a qualified facility, and reduce the amount of carbon oxide required to be captured by qualifying DAC facilities. S. 2263 would amend the federal tax code, Section 45Q, by changing what is considered secure geological storage of carbon oxide (a more general term covering CO2 and other oxides) and set out eligibility requirements for tax credits for carbon oxide storage associated with EOR. K~:> gognpo ' -pmm ggmm g , q 'S a X 11LULANJILiN,

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