A bipartisan group of governors from six major energy-producing states pressed congressional leaders Wednesday to back subsidies for advanced coal power plants in a tax extenders bill expected to come up later this year.
The group of four GOP and two Democratic governors want a tax credit for technologies used at coal plants and other fossil-fueled facilities to cut carbon dioxide emissions, called carbon capture.
“As governors committed to technology innovation and investments that increase American energy production, create good-paying, highly skilled jobs, and reduce emissions, we urge you to enact federal financial incentives to capture carbon dioxide (CO2) from power plants and industrial facilities,” the governors wrote to Senate and House leaders.
Republican Matt Mead of Wyoming, Republican Jeff Colyer of Kansas, Republican Mary Fallin of Oklahoma, Republican Doug Burgum of North Dakota, Democrat Steve Bullock of Montana, and Democrat Tom Wolf of Pennsylvania. Mead and Bullock organized the letter.
“These incentives are necessary to ensure that CO2 is put to productive use and subsequently stored safely and permanently underground,” the letter added. Energy Secretary Rick Perry supports the technology, which he touted early in the service of President Trump, particularly the Petra Nova coal plant in Texas that his agency helped fund.
“Carbon capture provides a long-term, low-carbon path for production and use of America’s abundant coal, oil and natural gas resources,” they wrote. “As governors from both political parties representing diverse states and regions, we believe carbon capture represents a key element of a broader, cost-effective portfolio of energy production and carbon management options.”
But the technology is still not commercially viable in all cases and still needs federal support, similar to federal tax subsidies given to solar and wind energy.
The governors aren't just looking for help from Congress in an extenders bill. They also laid out a number of areas where Congress could help the technology.
In addition to extending the federal tax credit for carbon capture, a bill that was introduced last year with significant bipartisan support, they also want Congress to pass legislation that makes carbon capture projects eligible for tax-exempt private activity bonds.
They also want policies and incentives to foster the development and financing of long-distance carbon dioxide pipelines as part of a broader national infrastructure agenda. "This will facilitate the buildout of pipeline infrastructure over time, reduce project development costs and encourage investors to make capital available on better financial terms," the governors wrote.
Nevertheless, the "immediate priority" is the extension and reform of the existing federal tax credit. They noted that Senate Finance Committee Chairman Orrin Hatch's tax extenders bill, introduced in December, included a bill extending the carbon capture subsidies while changing it to expand their eligibility.