With the U.S. Environmental Protection Agency as the headline sponsor, the first annual Climate Leadership Conference will be held from February 29-March 1, 2012, in Fort Lauderdale, Florida. The conference will bring together leaders from business, government and academic institutions, and the non-profit community interested in exchanging ideas and information on how to address climate change while simultaneously running their operations more competitively and sustainably.
The conference includes a gala to honor recipients of the Climate Leadership Awards, a new national awards program to recognize exemplary corporate, organizational, and individual leadership in response to climate change. U.S. EPA, in partnership with C2ES, The Climate Registry (The Registry), and the Association of Climate Change Officers (ACCO), sponsor the awards.
Featured conference speakers include:
- Nancy Sutley – Chair, White House Council on Environmental Quality
- Gina McCarthy – Assistant Administrator, Office of Air and Radiation, U.S. Environmental Protection Agency
- Mary Nichols – Chair, California Air Resources Board
- Eileen Claussen – President, Center for Climate and Energy Solutions
- Network with leaders from the public and private sectors, including federal and state government officials, industry leaders, and nonprofit experts
- Attend the Climate Leadership Awards Gala, which is held in conjunction with the conference
- Hear insights from winners of the 2011 Climate Leadership Awards for the Supply Chain, Organizational and Individual Leadership categories
Conference attendees will learn about and exchange solutions on topics including
- Leveraging Clean Energy Opportunities
- Managing Climate Risks and Building Resilience
- Supply Chain Strategies
- Disclosures and Questionnaires
- Setting and Achieving GHG Reduction Goals Education & Engagement
- Strategies Making the Business Case for Climate Response
Any sponsorship or advertisements appearing in these materials do not imply endorsement, recommendation, or favor by the United States Government or the U.S. Environmental Protection Agency.
Recommended Modifications to the 45Q Tax Credit for Carbon Dioxide Sequestration
The National Enhanced Oil Recovery Initiative (NEORI) recommends that Congress consider implementing a revenue-positive federal production tax credit to support deployment of commercial carbon dioxide (CO2) capture and pipeline projects. A new, more robust federal incentive is needed to increase the supply of man-made or anthropogenic CO2 that the oil industry can purchase for use in enhanced oil recovery (EOR) to increase domestic production from existing oil fields.
NEORI also recommends that Congress undertake immediate modification of the existing Section 45Q Tax Credit for Carbon Dioxide Sequestration, through legislative action and/or working with the Department of the Treasury to revise Internal Revenue Service program guidance.
To avoid stalling important commercial CO2 capture projects under development, there is an urgent need to improve the functionality and financial certainty of this federal incentive to enable its effective commercial use. To make 45Q immediately accessible to US companies, Congress should pursue the following changes to the program:
- Designate the owner of the CO2 capture facility as the primary taxpayer;
- Establish a registration, credit allocation, and certification process;
- Change the recapture provision to ensure that any regulations issued after the disposal or use of CO2 shall not enable the federal government to recapture credits that were awarded according to regulations that existed at that time; and
- Authorize limited transferability of the credit within the CO2 chain of custody, from the primary taxpayer to the entity responsible for disposing of the CO2.
The consensus recommendations below detail the specific 45Q program modifications requested, and the section-by-section summary provides further explanation and context.
Background and Rationale
Section 45Q makes available a per-ton credit for CO2 disposed of in secure geologic storage. The program provides $10 per metric ton for CO2 stored through EOR operations and $20 per metric ton for CO2 stored in deep saline formations. However, due to unforeseen issues in the original statute (§ 115 of the Energy Improvement and Extension Act of 2008), the 45Q program lacks sufficient transparency and certainty for companies to be able to use the credit to secure private financing for projects.
Large-scale expansion of commercial EOR using industrially-sourced CO2 later in this decade requires that critical industrial capture projects begin construction now and enter commercial operation within the next few years. If Congress makes modest, functional improvements this year to 45Q that result in little or no additional fiscal cost, the program currently authorized at 75 million metric tons of CO2 stored can help several significant EOR projects nationwide secure private sector financing and move forward to commercial operation.
1. 26 USC §45Q provides a tax credit for carbon dioxide sequestration. Section 45Q was enacted by § 115 of the Energy Improvement and Extension Act of 2008.
Learn about the new international coalition aimed reducing short-lived climate pollutants, a framework for carbon capture and storage, and how federal agencies are incorporating climate adaptation into their decision making, the start of a clean energy standard conversation, and more in C2ES's February 2012 newsletter.
February 14, 2012
Contact: Tom Steinfeldt, 703-516-4146
NEW REPORT OFFERS COMPREHENSIVE APPROACH TO ACCOUNT FOR
CO2 REDUCTIONS FROM CARBON CAPTURE AND STORAGE
Center for Climate and Energy Solutions’ Framework Lays Groundwork
for Future Energy & Climate Policy Action
WASHINGTON, D.C. – A new report released today by the Center for Climate and Energy Solutions (C2ES) provides the first-ever comprehensive framework for calculating carbon dioxide (CO2) emission reductions from carbon capture and storage (CCS). The framework equips policymakers and project developers with common methodologies for quantifying the emission impacts of CCS projects.
CCS involves a suite of technologies that can be used to prevent CO2 from power plants and large industrial facilities from entering the atmosphere. The three main steps are capturing and compressing the CO2 , transporting it to suitable storage sites, and injecting it into geologic formations for secure and permanent storage. CCS technology has the potential to achieve dramatic reductions in CO2 emissions from the electricity sector, including from coal-fueled power plants.
“Ensuring reliable, affordable energy while reducing carbon emissions is a critical challenge, and in the years ahead, carbon capture and storage will likely be an essential part of the solution,” said C2ES President Eileen Claussen. “This report provides an important technical foundation for crafting policies to put this technology to work to meet our energy, climate and economic objectives.”
The report, Greenhouse Gas Accounting Framework for Carbon Capture and Storage Projects, includes detailed methodologies to calculate emission reductions at each stage of the CCS process: CO2 capture, transport, and injection and storage. The methods were developed with input from CCS experts in industry, academia, and the environmental community (see report for list of participants).
For CO2 capture, the report outlines methods for multiple CO2 sources, including electric power plants with pre-combustion, post-combustion, or oxy-fired technologies, and industrial facilities involved in natural gas production, fertilizer manufacturing, and ethanol production. For CO2 transport, the framework focuses on pipelines, which are the most viable transportation option for large-scale CCS. With respect to the geological storage of CO2, the framework applies to saline aquifers, depleted oil and gas fields, and enhanced oil and gas recovery sites.
Worldwide, 15 large CCS projects are in operation or under construction, according to the Global CCS Institute. Their combined CO2 storage capacity exceeds 35 million tons a year, roughly equivalent to preventing the emissions from more than 6 million cars from entering the atmosphere each year. Four CCS projects – three in the U.S. and one in Canada – have started construction since 2010, and three of these are linked to enhanced oil recovery operations. Globally, 59 additional projects are in the planning stage.
C2ES also is facilitating the National Enhanced Oil Recovery Initiative, a group of policymakers and stakeholders seeking to increase U.S. domestic oil production and energy security and reduce greenhouse gas emissions through enhanced oil recovery (EOR) using captured CO2. Recommendations for federal and state policy to ramp up CO2-EOR will be released later this year.
The Center for Climate and Energy Solutions (C2ES) is an independent non-profit, non-partisan organization promoting strong policy and action to address the twin challenges of energy and climate change. Launched in November 2011, C2ES is the successor to the Pew Center on Global Climate Change, long recognized in the United States and abroad as an influential and pragmatic voice on climate issues. C2ES is led by Eileen Claussen, who previously led the Pew Center and is the former U.S. Assistant Secretary of State for Oceans and International Environmental and Scientific Affairs.
Greenhouse Gas Accounting Framework for Carbon Capture and Storage Projects
Meeting the global challenge to reduce greenhouse gas (GHG) emissions and avoid dangerous climate impacts requires deploying a portfolio of emission reduction technologies.
We must both commit to broad and deep efficiencies in the way our societies’ consume energy and to significant increases in power supplies from low carbon energy sources. At the same time, it is important to recognize that the scale of the challenge to reduce global emissions is massive, and that it will take decades for new and advanced low and zero-emissions technologies to sufficiently mature and dominate the world’s primary energy supply.
Because the use of fossil fuels – including coal – will continue to maintain a central role in powering the global economy for at least the next several decades, the portfolio of solutions to achieve the necessary GHG emissions reductions must include carbon capture and storage (CCS).
CCS refers to a suite of technologies that, when effectively combined, prevent carbon dioxide (CO2) from entering the atmosphere. The process involves capturing and compressing CO2 from power plants and other industrial facilities, transporting it to suitable storage sites, and injecting it into geologic formations for secure and permanent sequestration.
Geologic storage of CO2 emissions currently represents the only option to substantially address the greenhouse gas emissions from fossil fuel-fired power plants and large industrial facilities.
The Greenhouse Gas Accounting Framework for Carbon Capture and Storage Projects – CCS Accounting Framework – provides methods to calculate emissions reductions associated with capturing, transporting, and safely and permanently storing anthropogenic CO2 in geologic formations. It aims for consistency with the principles and procedures from ISO 14064-2:2006. Greenhouse gases – Part 2: Specification with guidance at the project level for quantification, monitoring and reporting of greenhouse gas emission reductions or removal enhancements, which represents best practice guidance for the quantification of project-based GHG emission reductions.
Ultimately, the objective of the CCS Accounting Framework is to inform and facilitate the development of a common platform to account for CO2 emissions reductions due to capturing and geologically storing CO2. It also contributes to the public discussion about the viability of CCS to serve as a feasible CO2 mitigation solution.
The emissions accounting procedures in the CCS Accounting Framework apply to multiple CO2 source types, including electric power plants – equipped with pre-combustion, post-combustion, or oxy-fired technologies – and industrial facilities (for example, natural gas production, fertilizer manufacturing, and ethanol production). For CO2 transport, the calculation methodology in this document applies only to pipelines because while other methods of transport, (e.g., truck transport) are possible, they are typically not considered viable options for large-scale CCS endeavors. With respect to the geological storage of CO2, the CCS Accounting Framework applies to saline aquifers, depleted oil and gas fields, and enhanced oil and gas recovery sites.
The CCS Accounting Framework provides a comprehensive set of GHG accounting procedures within a single methodology. The quantification approach includes equations to calculate emissions reductions by comparing baseline emissions to project emissions – the difference between the two represents the GHG reductions due to capturing and sequestering CO2, which would have otherwise entered the atmosphere.
GHG reductions from CCS project = Baseline emissions - Project emissions
Baseline emissions represent the GHG emissions that would have entered the atmosphere if not for the CCS project.
Project emissions are actual GHG emissions from CO2 capture sites, transport pipelines, and storage sites.
The quantification approach to determine baseline emissions presents two baseline options: 1) “Projection-based” and 2) “Standards-based.” In both cases, the calculation method uses data from the actual CCS project to derive baseline emissions.
Determining project emissions involves measuring CO2 captured and stored by the project and deducting CO2 emitted during capture, compression, transport, injection, and storage (and recycling of CO2 if applicable). The procedure to determine project emissions also accounts for GHG emissions from energy inputs required to operate CO2 capture, compression, transport, injection and storage equipment. Energy inputs include “direct emissions” from fossil fuel use (Scope 1 emissions) and, in case required by a program authority, “indirect emissions” from purchased and consumed electricity, steam, and heat (Scope 2 emissions).
CCS project monitoring covers large above ground industrial complexes and expansive subterranean geologic formations. In terms of emissions accounting, monitoring CO2 capture and transport involves well known technologies and practices, established over many years for compliance with federal and state permitting programs. Therefore, the monitoring program would follow generally accepted methods and should correspond with GHG monitoring requirements associated with the relevant subparts of EPA’s Greenhouse Gas Reporting Program (GHGRP) and other state-level programs.
On the other hand, monitoring geologic storage sites for the purpose of verifying the safe and permanent sequestration CO2 from the atmosphere is a relatively recent activity that may involve new techniques and technologies. While there exists no standard method or generally accepted approach to monitor CO2 storage in deep rock formations, project developers will benefit from monitoring practices deployed over the past 35 years in CO2 enhanced oil and gas recovery operations. Thus, the CCS Accounting Framework does not prescribe an approach to monitor CO2 sequestration, as geologic storage sites will vary from site to site and demand unique, fit-for-purpose monitoring plans. This approach is consistent with the monitoring, reporting and verification (MRV) procedures for geologic sequestration from subpart RR to EPA’s Greenhouse Gas Reporting Program, which overlays the monitoring requirements associated with the Underground Injection Control Program.
Learn about the Climate Leadership Conference, Australia's new carbon pricing mechanism, the Make an Impact energy conservation challenge, and more in C2ES's January 2012 newsletter.
Climate change is the global innovation challenge of our time. That was the theme of a Green Innovators in Business Network “Solutions Lab” in Cambridge, MA, last month co-hosted by C2ES, EDF, Innocentive, and others. Dr. Andrew Hargadon, a leading expert in technology management and author of “The Business of Innovating,” articulated for participants the enormous scale of innovation needed to achieve a clean energy economy. “Low-carbon innovation” is about dealing with new problems—carbon emissions, skyrocketing energy costs—that emerge from traditional solutions for making our economy work, such as for transporting goods or lighting our buildings. Transforming energy-consuming activities to emit less carbon requires that we deploy new technologies that will work with conventional behaviors, and develop entirely new behaviors.
Statement of Eileen Claussen
President, Center for Climate and Energy Solutions
January 24, 2012
We share President Obama’s enthusiasm for homegrown solutions to America’s energy challenges. Without question, America has the resources and know-how to produce more energy at home, strengthening both our economy and our national security. But protecting the climate also has to be part of the equation. If we sensitively develop domestic reserves, get serious about ramping up new energy sources, and push efficiency across the board, we can both meet America’s energy needs and dramatically shrink our carbon footprint.
Even if comprehensive legislation remains off the table for now, we can make important progress tackling these challenges piece by piece. C2ES is working with policymakers and stakeholders on ways to expand enhanced oil recovery using captured carbon dioxide – an approach that can boost domestic oil production while reducing greenhouse gas emissions. Similarly, we’re working with automakers, environmentalists and others on a plan for integrating plug-in electric vehicles into the U.S. electrical grid. We look forward to sharing the results of these and other C2ES initiatives aimed at practical solutions to our twin climate and energy challenges.
Contact: Tom Steinfeldt, 703-516-4146
Read the full transcript of the 2012 State of the Union Address
The Center for Climate and Energy Solutions (C2ES) was named the world’s top environmental think tank in a global survey of top public policy research institutes.
The University of Pennsylvania’s 2011 Global Go-To Think Tank Rankings are based on a survey of more than 1,500 policymakers, scholars, journalists, think-tank executives and others worldwide. The survey assessed more than 5,300 organizations nominated in 30 categories to create a global list of top think tanks by region and policy area.
C2ES’s predecessor organization, the Pew Center on Global Climate Change, was named the world’s top environmental think tank in the same survey in 2009. The center began operating as C2ES in November 2011, and is listed in the new survey under its former name.
“While our name has changed, we remain as committed as ever to fact-based analysis and common-sense solutions to our climate and energy challenges,” said C2ES President Eileen Claussen. “We are thrilled to again be recognized as the world’s top environmental think tank. I’d like to commend the C2ES staff and thank all of our partners and supporters in the United States and abroad for helping to make this possible.”
The independent, nonpartisan center provides impartial information and analysis on energy and climate challenges; convenes policymakers and stakeholders to work toward consensus solutions; works with members of its Business Environmental Leadership Council and others to promote on-the-ground action; and promotes pragmatic, effective climate and energy policies at the state, national and international levels.
The annual survey, first published in 2007, is directed by James G. McGann, assistant director of the University of Pennsylvania’s International Relations Program and director of the Think Tanks and Civil Society Program.
The World Resources Institute and Chatham House ranked second and third, respectively, among the study’s top 30 environmental groups. Brookings Institution was named the top overall think tank. Additional categories in which the report ranks organizations include health policy, international development, and security and international affairs, among others.
The complete study, released in January 2012, is available online here.
More about C2ES's work to advance climate and energy solutions can be found here.
Yesterday, EPA announced the public release of reported greenhouse gas (GHG) emissions from large facilities across the country. Under legislation signed by President George W. Bush, most large sources of GHG emissions, including refineries, power plants, chemical plants, car manufacturers, and factories emitting more than 25,000 tons of CO2 equivalent a year, have been reporting their annual emissions electronically to EPA since 2010, while small sources are specifically exempted from the rule. Now, in accordance with the law, EPA is making that data public.
Some similar information was public already. Power plants have been required to report their CO2 emissions since the 1990 Clean Air Act Amendments, while many other companies have voluntarily reported their emissions through programs like the Carbon Disclosure Project