CASPER, Wyo. — A Wyoming U.S. senator is one of three legislators sponsoring a bill that would make it easier for companies to attain tax credits for capturing man-made carbon dioxide.
Sen. Mike Enzi is co-sponsoring the bill, introduced by Sen. Kent Conrad, D-N.D., in September and co-sponsored by Sen. John "Jay" Rockefeller, D-W.Va. The bill is aimed at encouraging the capture and use of the greenhouse gas, commonly generated by coal-fired power plants and other industrial facilities.
According to Daniel Head, a spokesman for Enzi, producers looking to earn existing tax credits for carbon dioxide capture have told Enzi that the process isn't easy.
"(Enzi) has been told on numerous occasions that the (carbon dioxide) tax credit law as written is not stimulating new technology, and so he is working with senators Conrad and Rockefeller to make changes," Head said.
Current carbon dioxide tax credits allow companies to attain a $10-per-ton tax credit for the installation and use of equipment which captures the gas from industrial facilities for later use elsewhere. Some producers in Wyoming and elsewhere pump the gas into depleted oil wells to push out additional oil, a practice known as enhanced oil recovery.
Existing rules don't provide an application and certification program for the credits, making it difficult for companies interested to determine whether any of the credit funding — capped to accommodate 75 million tons of carbon capture — was available. Head said such a program is attached to the proposed bill.
"(The bill will) give project developers the ability to know that credits will be available for their project once they have met certain thresholds," Head said.
The project could provide significant incentives for companies considering installing equipment to capture produced carbon dioxide.
DKRW Advanced Fuels — a company planning a coal-to-gas plant near Medicine Bow — has agreed to capture and sell carbon dioxide generated at its plant to Denbury Resources. A pipeline would transport the carbon dioxide for use in enhanced oil recovery.
The total credit will still be capped at 75 million tons for the entire country, but each applicant would be able to attain credit for no more than 15 million tons. The credits will be awarded on a first-come, first-served basis.
The measure was referred to the Senate Committee on Finance after its introduction and has yet to be considered.
Richard Garrett, a legislative advocate for conservation group Wyoming Outdoor Council, called the bill a step in the right direction.
"If you believe coal’s important to the state of Wyoming, then you've got to make sure you do the right thing with the carbon dioxide," he said. "Otherwise it’s a wasted exercise."