Abstract

Mounting climate change concerns are driving unprecedented interest in carbon dioxide removal technologies. Unlike carbon capture strategies, which trap carbon dioxide at specific emission points such as power plant smokestacks, carbon removal technologies directly remove carbon dioxide from the ambient atmosphere. Fossil fuel industry stakeholders have championed carbon capture for years as a means of reducing carbon emissions while continuing the nation’s heavy reliance on carbon-intensive energy sources. This focus on promoting carbon capture has delayed the development of policies specifically aimed at promoting carbon removal. As a result, humankind has yet to effectively leverage carbon removal technologies in the race against climate change. Most existing carbon dioxide sequestration policies in the United States conflate carbon removal and carbon capture in ways that ignore the unique benefits that removal technologies can provide. Deliberately distinguishing between carbon capture and carbon removal and designing policies and programs that specifically promote removal technologies could finally enable carbon removal projects and markets to assume meaningful roles in the transition to a carbon-free energy system.

Table of Contents

Introduction

I. Capture, Removal, and the Climate

A. Carbon Capture Versus Carbon Removal

1. Carbon Capture: Mitigating the Release of New CO₂ Emissions

2. Carbon Removal: Achieving Net Reductions in Atmospheric CO₂

B. The Fossil Fuel Industry’s Role in the Conflation of Capture and Removal

1. A Heavy Focus on Incentivizing Carbon Capture

2. Inattention to Carbon Removal Policies

II. Shortcomings of Existing Carbon Removal Policies

A. Liability and Permanence Concerns for Removed Carbon

B. Valuing Carbon Removal

C. Inconsistent and Inadequate State-Level Incentives for Carbon Removal

D. IRC Section 45Q: A Case Study into an Effective Carbon Incentive

III. Incentivizing Carbon Removal Technologies to Realize Negative Emission Benefits

A. Defining and Distinguishing Carbon Removal Technologies

B. Amending Section 45Q to Create a Federal Tax Credit for Carbon Removal Strategies

1. Excluding Industrial Emitters and Future Emissions

2. Crediting a Metric Ton of Qualified Removed CO₂

C. Facilitating Removed Carbon Offset Markets

1. Promoting Transparency and Deterring Abuses

2. Reflecting the True Value of Negative Emission Benefits

Conclusion

Introduction

Klaus Lackner and his colleagues at Arizona State University’s Center for Negative Carbon Emissions recently unveiled the “MechanicalTree”—one of the world’s first devices capable of passively absorbing and removing large amounts of carbon dioxide (“CO₂”) from the ambient atmosphere.^[4] The MechanicalTree relies on the flow of wind to blow air through its metal column comprised of stacks of sorbent-filled disks that bind CO₂ upon contact.^[5] As a passive form of carbon removal, the MechanicalTree acts similarly to a natural tree—it stands in the wind and absorbs CO₂ that flows through its column. Lackner estimates that a large-scale farm of 120,000 MechanicalTrees occupying an area of just two to three kilometers could remove roughly 4 million tons of CO₂ annually using only the natural flow of the wind.^[6] The development of just 250 such MechanicalTree farms could remove the equivalent of more than two percent of global CO₂ emissions.^[7] If deployed at scale, these farms could significantly reduce levels of atmospheric CO₂, materially helping efforts to combat global warming.^[8]

The MechanicalTree is one example of a growing number of carbon removal technologies capable of assisting in the race against climate change. Carbon removal devices use modern technologies to extract CO₂––a major greenhouse gas––from the ambient atmosphere and could thereby be a valuable way to help slow global warming.^[9] Under the 2015 United Nations Paris Agreement, countries across the world formally committed to sufficiently reduce their net CO₂ emissions to prevent the global temperature from rising more than 1.5 in this century.^[10] Negotiators to the Paris Agreement recognized that meeting this ambitious goal would likely require nations to not only reduce their new CO₂ emissions but to also actively remove already existing CO₂ from the ambient atmosphere.^[11] Models underlying the Paris Agreement therefore assumed a heavy reliance on the future use of carbon removal technologies to achieve net-emission goals.^[12]

Despite the growing need for aggressive carbon removal, very few carbon removal projects are in operation around the world today.^[13]A myriad of obstacles, including capital costs and uncertainty about the market value of carbon removal services, continue to hinder the development and use of carbon removal technologies.^[14] Targeted incentive programs and more robust and stable market systems are needed to help lower the costs associated with carbon removal and to increase the rewards of developing and operating removal projects.^[15]

This Article emphasizes the important distinction between carbon capture and carbon removal and argues that a much greater policy focus on incentivizing and facilitating carbon removal is needed to enable these technologies to reach their full potential as weapons in the fight against climate change. The federal government in particular is well-positioned to reduce the market risks associated with private investments in carbon removal technologies and to promote higher levels of such investment. Part I of this Article describes the race against climate change and the distinct ways that carbon capture and carbon removal assist in that effort. Part II outlines the current regulatory structures governing carbon removal technologies in the United States (“U.S.”) and highlights various shortcomings that continue to hinder private investment in carbon removal. Part III identifies how specific policy strategies, including a clearer statutory definition of carbon removal and the development of a carbon removal specific tax credit, could promote much greater investment in the nation’s nascent carbon removal industry.

I. Capture, Removal, and the Climate

Humankind’s need to reduce global atmospheric CO₂ levels has never been more urgent, necessitating the use of all tools capable of aiding in that effort.^[16] The U.S. Energy Information Administration (“EIA”) projected in 2019 that global CO₂ emissions from energy-related sources would continue to increase at an average rate of 0.6% per year through 2050.^[17] Preliminary examinations of global energy-related emissions in 2021 reflected an increase of nearly 1.5 billion tons of CO₂––the second-largest annual increase in history.^[18] Based on these projections, experts caution that a failure to rein in anthropocentric emissions could allow atmospheric concentrations of greenhouse gases levels to double pre-industrial era levels by mid-century.^[19] In light of this threat, a 2021 United Nations Framework Convention on Climate Change (“UNFCCC”) report urged nations to redouble their climate efforts to salvage the world’s chance at reaching the goals set out in the Paris Agreement.^[20] A recent report issued by the Intergovernmental Panel on Climate Change (“IPCC”) similarly warned that the planet is on track for warming of 2 during the twenty-first century––a figure that far surpasses the hopeful Paris Agreement goal of limiting warming to 1.5.^[21] The United Nations (“UN”) Secretary-General called this most recent emissions data a “code red for humanity” and strongly admonished nations and corporate leaders to work together to rapidly transform to a carbon-free global economy.^[22]

Transitioning to a carbon-free economy while still preserving energy security and equitably meeting humankind’s growing demand for energy will require both unprecedented investment in clean energy production and the sequestering of billions of tons of excess CO₂ already present in the atmosphere.^[23] Greater reliance on carbon capture technologies will undoubtedly be needed to achieve clean energy production and the ultimate goal of a carbon-free economy.^[24] Achieving a carbon-free economy, however, will require an equal reliance upon the utilization of carbon removal technologies. While both carbon capture and carbon removal are imperative, many tend to overlook the significance of carbon removal and its capability to absorb excess CO₂ directly out of the atmosphere.^[25] For example, most commentary surrounding the 2021 IPCC report failed to mention the report’s prediction that maintaining a “livable planet” will require the removal of 100 billion to 1 trillion tons of existing atmospheric carbon by the end of the century.^[26] Most climate scenario analyses agree that mitigating emissions alone will likely be insufficient to keep global temperatures from rising and that negative emissions technologies (“NETs”) will also be needed.^[27] Unlike carbon capture technologies, which limit releases of new CO₂ emissions, NETs, a carbon removal technology, work to reverse the effects of global warming by drawing down existing atmospheric CO₂ levels.^[28]

Carbon capture and carbon removal projects both share the same end goal of safely reducing net carbon emissions, but the effects of these projects differ in fundamental ways. Carbon sequestration, carbon storage, biological sequestration, and geological sequestration all refer to the process of permanently keeping the carbon oxides trapped through capture or removal out of the atmosphere.^[29] However, existing policies often fail to adequately distinguish between carbon removal and carbon capture, which has allowed for oil industry and energy stakeholders to overinvest in capture technologies, which serve their corporate interests and business models. Lacking a similar, large-scale industry to champion for its capabilities, carbon removal technologies have suffered from severe underinvestment and a lack of national attention. Helping investors, developers, and regulators understand the important distinction between capture and removal and its corresponding policy implications is a crucial first step toward fully leveraging carbon removal technologies in the fight against climate change.

A. Carbon Capture Versus Carbon Removal

The distinction between carbon removal and carbon capture technologies is easily blurred and commonly overlooked.^[30] The terms “carbon capture” and “carbon removal” are incorrectly used in a variety of settings, resulting in terminological confusion that causes many to conflate these two technologies.^[31] Carbon capture consists of strategies that large-scale polluting industries and businesses use to limit the new carbon emissions resulting from their ongoing activities. By contrast, carbon removal strategies actually reduce atmospheric CO₂ levels––a potentially far greater net benefit to society than mere carbon capture. The difference between carbon capture and carbon removal is more than just semantics: the frequent conflation of these terms obscures the unique benefits of carbon removal, slowing the development and deployment of these increasingly valuable technologies.

1. Carbon Capture: Mitigating the Release of New CO₂ Emissions

Carbon capture is a purely mitigative strategy focused on limiting the release of future anthropocentric CO₂ emissions.^[32] Carbon capture technologies typically capture CO₂ released from fossil fuels burning at a single point of emission––usually directly from a smokestack or flue.^[33] Carbon capture technologies are commonly part of larger Carbon Capture & Storage (“CCS”) projects designed to place CO₂ gas into secure long-term storage.^[34] Alternatively, Carbon Capture with Utilization & Storage (“CCUS”) projects utilize compressed CO₂ gas to produce commercial products.^[35] CCS and CCUS projects typically involve three or four principal participants who enter into commercial arrangements that tie together the various processes required to operate a project, including an emitter, capturer, transporter, and user or storer of CO₂.^[36]

Stationary electric generating facilities such as coal and natural gas-fired power plants are the most common users of carbon capture technologies.^[37] As coal-fired operations are directly responsible for a substantial volume of greenhouse-gas emissions, many coal companies and coal-fired electricity stakeholders have long been strong advocates of carbon capture techniques.^[38] The fossil fuel industry’s campaign for carbon capture can be traced back to the early 1970s, when energy companies first began engaging in Enhanced Oil Recovery (“EOR”).^[39] EOR involves the injection of CO₂ onto depleted or shale oil fields to increase oil recovery.^[40] Most CO₂ utilized for EOR was initially sourced from resources in close proximity to the oil fields or wells.^[41] Increasingly, however, CO₂ trapped through carbon capture processes has become another important source for EOR activities.^[42] In some instances, injecting CO₂ into oil wells and fields simultaneously aids oil recovery and sequesters the CO₂ underground.^[43] Accordingly, the International Energy Agency (“IEA”) suggested that EOR could facilitate full lifecycles of oil-related emissions to be “neutral or even ‘carbon-negative.’”^[44] The U.S. Department of Energy (“DOE”) similarly declared that EOR could be an “un-mined gold story” for the energy sector by increasing domestic oil production, boosting economic development, and concurrently sequestering CO₂.^[45] Pairing carbon capture with sequestration through EOR can benefit large carbon emitters by enabling them to mitigate their net CO₂ emissions and sell or utilize the subsequently captured carbon for EOR projects, thereby earning additional profits while potentially benefitting from associated carbon capture subsidies.^[46] From a broader societal perspective, however, the net benefits of this practice are less certain because it perpetuates reliance on fossil fuels and still results in net increases in CO₂ emissions over time.^[47]

2. Carbon Removal: Achieving Net Reductions in Atmospheric CO₂

Unlike carbon capture strategies, most carbon removal strategies cause net reductions in atmospheric CO₂.^[48] The term “carbon dioxide removal” refers to specific human activities and technologies that aim to absorb CO₂ from the ambient atmosphere.^[49] Rather than solely mitigating releases of new emissions from particular sources of emission, carbon removal projects extract CO₂ emitted by others from the ambient atmosphere.^[50] Put differently, carbon capture strategies merely limit a new polluter’s emissions of gas while carbon removal cleans up harmful gas left behind by a collection of unknown past polluters. Hence, the distinction between removal and capture is substantive and should be recognized when designing carbon removal policies.^[51]

Carbon removal strategies or NETs typically either amplify natural CO₂ absorption processes or use mechanical means to remove CO₂ from the atmosphere, concentrate it, and sequester it underground.^[52] The table in Figure 1 below summarizes some common types of CO₂ removal strategies.

Figure 1: Natural and Mechanical CO₂ Removal

Natural Removal Strategies
Forestation		Forestation refers either to afforestation or reforestation. Afforestation involves planting forests on grasslands or shrublands, and reforestation involves planting forests on previously natural, but once converted lands.[53] The amount of CO2 removed by forestation depends on a number of factors, including the availability of sufficient land, nutrients, water, type of trees, and CO2 levels.[54]
Coastal Blue Carbon		Coastal blue carbon strategies involve the restoration or enhancement management of wetlands and seagrass meadows, which hold large amounts of CO2 in biomass and sediments to help these resources absorb more atmospheric CO2.[55]
Enhanced Carbon Mineralization		Enhanced carbon mineralization accelerates the natural processes by which minerals absorb atmospheric CO2.[56] The long-term benefits of enhanced mineralization are known, but the process itself remains in early stages of research and development.[57] One potential strategy involves mining specific minerals, grinding them into powder, and then spreading the powder over soils where it could react with the air to form carbonate minerals.[58]
Ocean Alkalinization		Ocean alkalinization involves the adding of alkaline substances to the open ocean, where they absorb CO2.[59] Such enhancement accelerates ocean carbon uptake and can also combat ocean acidification.[60]
Mechanical Removal Strategies
Bioenergy with Carbon Capture and Storage (“BECCS”)	BECCS involves growing or collecting biomass and converting it into biofuels or energy.[61] CO2 emissions generated through this process are then captured and stored underground or in long-lasting products.[62] BECCS is classified as a form of carbon removal because the biomass used in the process naturally draws down and absorbs carbon as it grows.
Biochar	Biochar is a kind of charcoal produced by heating biomass in a low-oxygen environment.[63] When buried or plowed into soil, biochar locks carbon away for decades or centuries.[64] The volume of CO2 removed and stored depends on the type of biomass used, how it is sourced and heated, and whether the soil is disturbed, among other factors.[65] Biochar constitutes a mechanical process because it fixes atmospheric CO2 in a stable form that is easily sequestered.[66]
Direct Air Capture (“DAC”)	DAC refers to technologies that remove CO2 from ambient air using human-made machines.[67] Such machines typically utilize chemical processes to separate out CO2 for subsequent sequestration in geological reservoirs or long-lasting products.[68] Although “capture” appears in its name, DAC is a form of carbon removal because it works to absorb ambient CO2. The MechanicalTree is such an example of DAC technology.[69]

 

Carbon removal strategies widely vary in their capacity to efficiently absorb atmospheric carbon and in their ability to be viably scaled up to a level that could have a significant impact on climate mitigation.^[70] For example, BECCS is among the most prominent CO₂ removal methods because of its distinct capacity to efficiently remove carbon and concurrently generate energy.^[71] The ability for many conventional power plants to burn biomass also allows BECCS to be relatively easily integrated into existing energy infrastructure.^[72] However, the potential for mass deployment of BECCS projects is limited because of its large land footprint.^[73] By contrast, DAC involves absorbing and sequestering CO₂ using energy-intensive machines.^[74] DAC technologies tend to have fewer siting constraints and smaller land footprints than BECCS,^[75] but they have historically required large amounts of energy to operate, limiting their desirability.^[76] Fortunately, recent innovations have made DAC machines more energy efficient and economically feasible, spurring new investment in DAC technologies.^[77] For example, the world’s largest DAC plant began operating in Iceland in September of 2021.^[78] Powered by renewable energy sourced from a nearby geothermal power plant, the Orca Facility is poised to remove up to 4,000 tons of CO₂ annually.^[79]

Technologies like the MechanicalTree described in the introduction to this Article are particularly appealing new forms of DAC because of their much lower energy costs of removing CO₂.^[80] The MechanicalTree absorbs CO₂ without any mechanical assistance or energy intensive processes employed by most other removal systems.^[81] The MechanicalTree is also easier to scale: given its compact column design, developers can scale by simply installing greater numbers of units on the ground in a given area, similar to how photovoltaic solar panels are deployed in large solar farms.^[82] In partnership with Carbon Collect Limited, an Ireland-based company, Arizona State University plans to deploy various small-scale pilot MechanicalTree farms in the coming years while preparing the devices for mass production.^[83] Such pilot farms alone are expected to be able to remove up to 36,500 metric tons of CO₂ annually, offsetting roughly 1,844 American households’ worth of emissions.^[84] Carbon Collect boasts that its MechanicalTree technology is a tool which, when replicated in the thousands and deployed from mid-decade on, could play a major role in mitigating climate change.^[85]

Regardless of their specific strategy, carbon removal technologies and methods reduce net atmospheric CO₂ levels and thus have an important role to play in the race against climate change. A successful transition to a carbon-free economy will require nations and companies to aggressively leverage carbon removal strategies along with other important climate change-fighting tools. Unfortunately, existing policies in the U.S. largely ignore the unique and valuable benefits of atmospheric drawdown, the point at which future levels of greenhouse gases in the atmosphere stop climbing and start to steadily decline, resulting in a significant underinvestment in removal strategies.

 

B. The Fossil Fuel Industry’s Role in the Conflation of Capture and Removal

The federal government’s disproportionate focus on carbon capture as a climate change mitigation tool and relative inattention to carbon removal policies have greatly impacted the evolution of these two industries. The wide-scale implementation of carbon capture technologies in the U.S. is partly the result of the fossil fuel industry’s aggressive championing of government incentives and rules that conflate carbon removal with capture. By contrast, the federal government’s failure to fully recognize and reward the distinct benefits of carbon removal has heretofore prevented these technologies from maturing and attracting significant private investment.

1. A Heavy Focus on Incentivizing Carbon Capture

The fossil fuel industry has historically favored policies and subsidies that have facilitated the development and deployment of carbon capture technologies, and that influence has impacted carbon capture policies in the United States.^[86] Strong industry support for carbon capture has enabled these technologies to gain status as significant response tools in the global race against climate change.^[87] For example, in 2005 the IPCC issued its first Special Report devoted entirely to carbon capture, identifying the technology as a legitimate climate policy response tool.^[88] Carbon capture was similarly recognized in the 2015 UN Paris Agreement as an important ancillary strategy for climate change mitigation.^[89] More recently, a 2020 IEA Special Report advised that carbon capture projects warrant “particular focus” because of their ability to mitigate emissions from existing energy infrastructure.^[90] In part because of massive global investment in carbon capture research and development, carbon capture has emerged as a technologically feasible and somewhat viable approach to carbon emissions mitigation. Technologies currently in use have the ability to capture about eighty-five to ninety-five percent of CO₂ emitted at a particular facility or plant.^[91] The current carbon capture technologies in operation around the globe have the capacity to capture more than 40 metric tons of CO₂ each year.^[92] The ability of these technologies to successfully capture, and thereby mitigate, a significant volume of CO₂ emissions has spurred even greater interest in carbon capture as a business-friendly climate change response tool.^[93]

Although carbon capture can assist in the global battle against climate change, it also comes with significant attendant costs. For instance, one study found that an electric generating facility equipped with carbon capture technology requires ten percent to forty percent more fuel inputs per unit of generated power than a facility without carbon capture technology.^[94] Moreover, reliance on carbon capture technologies implicates continued and potentially even expanded reliance on fossil fuels to generate electricity.^[95] Climate mitigation policies are forcing many fossil fuel industry stakeholders to shift their business models,^[96] and carbon capture may be viewed by some such stakeholders as a means to survive.^[97] A focus on promoting carbon capture is consonant with these stakeholders’ often-repeated message that continued heavy reliance on coal, oil, and gas is the only option for meeting global energy demands.^[98] By characterizing carbon emissions as an isolated problem that carbon capture can solve, fossil fuel companies willing to utilize carbon capture technologies can seek to deceptively position themselves as climate change-fighting heroes.^[99] For example, energy giants such as Exxon Mobil, Kinder Morgan, and Occidental Petroleum Corporation have invested in carbon capture technologies, made notable pledges to become carbon-neutral, and formed business-focused task forces to develop sequestration projects.^[100]

In addition to emphasizing their willingness to invest in carbon capture, fossil fuel industry stakeholders have long persuaded the federal government to support their efforts.^[101] Such stakeholders argue that large-scale carbon capture is only feasible through generous subsidies under an industry-friendly regulatory regime.^[102] These efforts have been widely successful in the United States, where Congress has allocated at least $11 billion to carbon capture and sequestration projects.^[103] Many lawmakers and politicians have likewise embraced the narrative that supporting the fossil fuel industry’s carbon capture efforts is a more desirable or promising strategy than adopting policies that accelerate a transition away from fossil fuels.^[104] Left unchecked, such self-interested stakeholders could make decisions that ignore external costs and benefits associated with their businesses, thus instigating externality problems or economic market failures.^[105]

Throughout the first year of the Biden Administration, carbon capture technologies continued to benefit from federal incentives. For example, the Infrastructure Investment and Jobs Act (“Infrastructure Bill”) signed into law by President Biden on November 15, 2021, allocated billions of federal dollars to the development of carbon capture, utilization, and storage projects.^[106] The Infrastructure Bill included a broad range of CCUS targeted provisions, including appropriations to support and expand the DOE’s existing Carbon Capture Technology and Carbon Storage programs and a new CO₂ Transportation Infrastructure Finance and Innovation program.^[107]

The fossil fuel industry’s long history of championing carbon capture-favorable government policies has played a major role in the adoption and design of these and similar policies, most of which make few, if any, distinctions between carbon capture and carbon removal.

2. Inattention to Carbon Removal Policies

Policymakers’ heavy focus on carbon capture-related policies diverted attention away from multiple other promising climate mitigation tools, including carbon removal.^[108] To date, most of the global community has done little or nothing to help lay a policy groundwork for the mass deployment of CO₂ removal technologies on the immense scale needed to meet the Paris Agreement goals.^[109] Although scientists have recognized the critical need for large-scale carbon removal, and while the general principles and processes of removal have been known for decades, neither the international community nor individual nations have purposefully considered how to more effectively and quickly integrate carbon removal into their climate mitigation portfolios^[110]

Unlike well-established carbon capture stakeholders, carbon removal stakeholders—such as environmental organizations, scientific research institutions, community groups, and clean energy companies—lack the wealth and political influence needed to garner strong government support for their fledgling industry.^[111] Carbon removal suffers from the all too well known positive externality problem—those few stakeholders investing and utilizing carbon removal technologies confer a benefit upon unrelated and uninvolved third parties, namely, society, by removing emissions from the atmosphere around them. In return for their efforts, removers obtain mere title to compressed gas.

Those few existing policies and regulations that do recognize and support carbon removal technologies generally do so only as an incident to a carbon capture policy or under the umbrella of a larger carbon capture and sequestration incentive program.^[112] The federal allocations in the recent Infrastructure Bill serve as a prime example of how carbon removal technologies fare when compared against carbon capture.^[113] The Infrastructure Bill directed over $10 billion worth of appropriations to carbon capture activities but directed just $3.5 billion for the funding of four regional DAC hubs and another $115 million for DAC technology competitions.^[114] After decades of being largely ignored by policymakers, the carbon removal sector celebrated the distinct allocations yet remain skeptical that such funding will be sufficient to support the success of carbon removal startups.^[115] For removal technologies like DAC to become self-perpetuating commercial models, the federal government would likely need to subsidize and financially de-risk the construction and development of carbon removal projects at similar or greater proportions than it has done for carbon capture projects.^[116] Such subsidies and appropriations are vitally important for carbon removal projects because those engaging in carbon removal currently receive no tangible benefit other than title to removed CO₂––an asset without a well-established market. Government intervention in the form of new regulations or policies could mitigate externality problems by holding carbon-emitting actors accountable for the proportionate costs of their actions and by benefitting carbon-removers for the societal benefits of their work.^[117]

Regardless of the political motivations involved, neither carbon removal nor carbon capture technologies alone have the capacity to adequately address the planet’s urgent climate crisis.^[118] Accordingly, policies that continue to encourage reductions in new emissions and incentivize the removal of more previously-emitted CO₂ are needed.^[119] As carbon capture technologies have historically benefitted from decades of federal policy focus, the time has arrived for carbon removal technologies to receive comparable attention.

II. Shortcomings of Existing Carbon Removal Policies

The existing set of laws and policies governing carbon removal in the United States are disjointed and interwoven among carbon capture regulations and incentive programs in ways that constrain growth and investment in removal technologies and projects. Focusing heavily on carbon capture, such policies fail to reflect the unique additional benefits of carbon removal and have thus inhibited the nation’s removal industry from maturing and attracting substantial private investment. This Part describes how the current patchwork of regulations and programs governing carbon removal in the U.S. focuses on capture, thereby constraining the emergence of a viable carbon removal industry, by showcasing how these laws are intertwined among the framework for carbon capture and sequestration.

A. Liability and Permanence Concerns for Removed Carbon

Significant barriers, such as liability risks and policy uncertainties regarding what constitutes “permanent” storage, have slowed the emergence of a carbon removal industry in the United States.^[120] With no comprehensive regulatory framework to govern CO₂ storage nor any federal definition for the terms “secure” or “permanent,” carbon removal project developers and operators must navigate a patchwork of liability and traditional risk frameworks that provides minimal guidance on how to appropriately conduct long-term carbon storage.

Carbon removal liability risks consist primarily of two main types: operational liability and post-injection liability.^[121] Operational liability risks include risks associated with the operation of CO₂ capture, transport, and injection, including environmental, safety, and health risks.^[122] Post-injection liability risks comprise risks associated with the storage of CO₂ in geological formations.^[123] Most liability concerns arise in the form of post-injection liability, as long-term storage in subsurface formations can lead to potential migration or leakage of CO₂ to the surface.^[124] Such migration or leakage could potentially harm the environment, property, or human health in various ways.^[125] Existing liability regimes in the U.S. that could be implicated in this context include the EPA’s Underground Injection Control Program—which governs underground injection under classes of injection wells—and potential claims under tort and contract law such as nuisance, strict liability, and negligence claims.^[126] Unfortunately, significant uncertainty remains regarding how these laws might apply in the context of underground carbon storage.

Those seeking economic benefits for their storage of CO₂ obtained through carbon removal must also confront the question of what constitutes “permanent” storage. There is presently no comprehensive legal or regulatory regime guiding the permanence of CO₂ in storage facilities. In theory, most carbon sequestration facilities seek to store carbon indefinitely. However, there is an inherent risk that efforts to permanently store carbon could eventually fail due to poor monitoring, subsurface migration, or leakage to the surface.^[127] Some operating permits and government programs, such as offset credit programs, define permanence by delineating how long the firm who is responsible for operating a storage facility must store carbon to receive a storage credit. By contrast, Washington’s Underground Injection Control Program defines “permanent sequestration” as “the retention of greenhouse gases in a containment system using a method that creates a high degree of confidence that substantially ninety-nine percent of the greenhouse gases will remain contained for at least one thousand years.”^[128] Given this wide variance in treatment, greater uniformity and certainty on the question of carbon storage permanence will likely be needed to support the emergence of robust carbon removal markets.

B. Valuing Carbon Removal

Attaching measurable economic value to carbon removal is another major obstacle to unleashing widespread carbon removal development.^[129] A myriad of questions arise in attempts to valuate carbon removal activities. Ideally, a functioning marketplace would emerge through which entities seeking to offset their carbon emissions could purchase carbon removal credits, helping to create a fluid market price. However, it is presently unclear whether there would be sufficient demand for such carbon removal credits to support such a market at prices that would incentivize carbon removal development. For instance, the DOE has calculated one metric ton of CO₂ costs $58.30 based on the value of one carbon capture machine,^[130] and the per-unit costs may initially be even higher for many carbon removal strategies. Government subsidies will likely be needed to overcome these barriers, and even with such support, creating standardized pricing for the variety of different carbon removal strategies already in existence could present challenges.

Even more problematic is the tendency for existing systems to conflate a metric ton of captured carbon with a metric ton of removed carbon, even though for reasons discussed above these two assets are apples and oranges. Markets in more-valuable carbon removal credits are only possible under a system in which such credits are clearly distinguished from carbon capture credits. Additionally, for removal to become more economically profitable, value must be placed upon the removal itself, rather than the carbon. In other words, carbon removal must value the removal asset and recognize carbon as waste, in contrast to carbon capture, which places value on carbon as an asset. A system that recognizes that atmospheric CO₂ imposes costs on society and that removal thus creates economic and environmental value will further distinguish capture and removal and create greater demand for carbon removal development.

C. Inconsistent and Inadequate State-Level Incentives for Carbon Removal

In the absence of a federal policy framework for carbon removal projects, states have collectively enacted their own patchwork of policies that regulate or encourage carbon removal in mostly insufficient ways. For instance, some states offer tax incentives for carbon capture projects under their greenhouse-gas emission reduction programs.^[131] While these programs have been successful in incentivizing carbon capture and sequestration projects, they fail to provide adequate incentives to drive investments in carbon removal development. Likewise, about half of the U.S. states have developed climate action plans and adopted greenhouse gas emission targets. Programs and policies created in pursuit of these targets include renewable portfolio standards, clean energy standards, carbon pricing schemes such as cap-and-trade programs, or carbon taxes—none of which directly encourage carbon removal.

Existing state-level carbon capture incentive policies have also proven ineffective at promoting carbon removal development. One successful carbon capture incentive mechanism involving eleven U.S. states is a cap-and-trade program known as the Regional Greenhouse Gas Initiative.^[132] Under this investment, a government puts a “cap” on greenhouse gas emissions that limits pollution more aggressively than an emission goal.^[133] Companies can then buy and sell allowances where supply and demand set a price for captured and stored carbon.^[134] Other programs, such as California’s Low Carbon Fuel Standard^[135] and certain economic incentives offered in Texas,^[136] have successfully provided opportunities to aid the financing of carbon capture. However, these programs are designed for carbon capture in the context of fossil fuel burning and thus tend not to promote investments in carbon removal.

D. IRC Section 45Q: A Case Study into an Effective Carbon Incentive

The federal government’s most generous and impactful incentive for carbon capture offers inadequate incentives for carbon removal development. Presently, the most significant federal economic incentive for carbon capture projects is the federal tax credit offered to qualifying projects under Section 45Q (“45Q”) of the Internal Revenue Code (“IRC”)––a provision enacted in 2008 that specifically targets carbon capture activities.^[137] Designed to incentivize industrial emitters to invest in carbon capture and sequestration, the tax credit is available to qualifying facilities that utilize qualified capture equipment.^[138] Some see the tax credit as a valuable mechanism to encourage qualifying facilities to responsibly mitigate their CO₂ emissions, while others have characterized the credit merely as another fossil fuel subsidy.^[139] Compared to negative market-leveraging approaches—such as pollution charges or fees—the tax credit offered in 45Q is a positive financial incentive.^[140] By any measure, 45Q has been the most impactful federal incentive mechanism for carbon emissions mitigation to date.^[141]

Given its success as a financial incentive for carbon capture, 45Q could have a similar effect in promoting carbon removal development were it to be amended to include a specific and distinct credit for carbon removal investments.^[142] The most recent amendments to 45Q did extend its provisions to cover DAC,^[143] expressly providing that the credit extends to facilities through which CO₂ “is captured directly from the ambient air.”^[144] Unfortunately, this passing mention of DAC removal is small in comparison to the Section’s primary focus on captured carbon and still does not recognize and reward the unique additional benefits of carbon removal.

Moreover, some provisions within Section 45Q create uncertainty about how the section could apply to most carbon removal projects. For instance, eligibility for the credit is based upon the construction of a “qualified facility,”^[145] and the taxpayer must subsequently use this facility to capture carbon.^[146] Section 45Q defines “qualified carbon oxide” as carbon dioxide or other carbon oxide which:

 

(i) is captured from an industrial source by carbon capture equipment which is originally placed in service on or after the date of the enactment of the Bipartisan Budget Act of 2018,

(ii) would otherwise be released into the atmosphere as industrial emission of greenhouse gas or lead to such release, and

(iii) is measured at the source of capture and verified at the point of disposal, injection, or utilization.^[147]

In other words, in their current form Section 45Q’s provisions seem to only benefit industrial emitters who capture their own carbon emissions. Taken as a whole, these and other existing policies and incentives leave carbon removal developers unable to confidently plan for future projects.^[148]

 

III. Incentivizing Carbon Removal Technologies to Realize Negative Emission Benefits

The carbon removal industry could greatly benefit from new federal regulations, policies, and initiatives designed to reward the unique benefits of atmospheric drawdown, which are currently disproportionately undervalued.^[149] An important first step toward effectively incentivizing the development of carbon removal technologies is to create widely accepted standards and definitions for carbon removal to be utilized in forthcoming federal policies and regulations, in addition to integrating such terms into existing federal schemes. Armed with such standards that account for carbon removal’s unique ability to achieve atmospheric draw-down, Congress could, for example, amend Section 45Q to create a higher-valued reward designed specifically for carbon removal activities. Federal regulators and policymakers could further encourage the development of carbon removal projects by creating regulations and policies that certify units of removed carbon oxides, so they can be bought and sold within a removed carbon offset market. As detailed in this Part, such actions could collectively enable carbon removal technologies to mature and expand throughout the country.

A. Defining and Distinguishing Carbon Removal Technologies

Policies that clearly recognize and account for the unique benefits of carbon removal could do much to support the formation of policies capable of supporting the emergence of carbon removal markets. The absence of clear terminological distinctions between carbon capture and carbon removal in existing legal schemes have impeded the removal industry from reaching a sufficient maturity and scale to be commercially viable.^[150] By conflating carbon capture and carbon removal, existing policies and programs also make it more difficult for removal technologies to gain recognition as a distinct global warming mitigation strategy with advantages in the race against climate change.^[151] Addressing this problem will require a focus on crafting policies, regulations, and incentives that clearly define CO₂ removal as an activity entirely different from carbon capture.^[152] Only carbon removal activities target and draw down existing atmospheric CO₂, resulting in net reductions in atmospheric levels—something that carbon capture fails to do.^[153] As one possibility, CO₂ removal could be defined as any anthropogenic activity that deliberately extracts CO₂ from the ambient atmosphere.^[154] Such a definition is broad enough to encompass the wide range of removal techniques and technologies currently available, while narrow enough to prevent conflation with capture strategies.^[155]

In laying the foundation for a carbon removal framework, it could be additionally valuable to classify and define standards for NETs.^[156] For example, mechanical NETs could be defined as any technology that artificially works to draw down the volume of atmospheric CO₂ on a time scale that positively impacts climate change.^[157] Such a definition is inclusive of artificial technologies such as the MechanicalTree and creates a requirement that these NETs provide measurable greenhouse gas reduction benefits on a discernible and impactful time scale.^[158] Separate definitions for afforestation activities and other forms of natural NETs would account for the additional uncertainty regarding their long-term impacts.

B. Amending Section 45Q to Create a Federal Tax Credit for Carbon Removal Strategies

Integrating new definitions of CO₂ removal and mechanical NETs, like those just described, into existing federal incentive programs, such as IRC Section 45Q, would finally kick-start investment in the nation’s nascent carbon removal industry.^[159] As described in Part II above, the Section 45Q tax credit has been the most impactful federal program in promoting private investment into carbon capture technologies and activities.^[160] In 2018, the FUTURE Act expanded Section 45Q credit eligibility to more industries by broadening the definition of “qualified facilities” to include those utilizing direct air capture technologies.^[161] While it was a welcome step toward promoting carbon removal,^[162] the amendment failed to account in any way for the additional benefits of carbon removal over carbon capture and thus had minimal impacts. By contrast, an amendment to Section 45Q that provided a clearer definition of carbon removal and offered stepped-up tax credit benefits for carbon removal activities would appropriately incentivize growth within the carbon removal industry.

1. Excluding Industrial Emitters and Future Emissions

An amendment to 45Q that offers special stepped-up tax credits to non-industrial actors—those working independent of any greenhouse gas-emitting facilities in their normal operations—would finally create adequate incentives for those engaging in carbon removal activities. The 45Q tax credit indirectly encourages the nation’s continued reliance on fossil fuels, thereby potentially slowing the nation’s transition to a carbon-free economy.^[163] By design, Section 45Q incentivizes greenhouse-gas emitting industries to be more environmentally responsible in their use of coal by rewarding “qualified facilities,” defined as “any industrial facility,” for their capture of CO₂ that would otherwise be released into the atmosphere “as industrial emission of greenhouse gas or lead.”^[164] As written, Section 45Q cannot be feasibly extended to NETs because they do not fit within the parameters of recognized “qualified facilities” and are not designed to capture CO₂ which otherwise would be released into the atmosphere as an industrial emission.

Congress’ recent amendments to 45Q to cover DAC facilities also fall short of encompassing a broad array of NETs. Among other things, to qualify for the credit a DAC facility must use “carbon capture equipment to capture carbon dioxide directly from the ambient air.”^[165] This definition limits 45Q credit eligibility to those DAC technologies that use carbon capture equipment—another instance where existing laws conflate capture and removal. The amendments do not clarify whether 45Q’s DAC definition extends to technologies developed and utilized independent from any industrial facility or source, such as the MechanicalTree. And even if the credit does extend to independently sited technologies, the provision effectively excludes all other carbon removal strategies.^[166] In short, as currently written, 45Q does not sufficiently support or reward the efforts of the carbon removal industry.

Enacting a new provision that specifically offers stepped-up tax credits to non-industrial actors working independently from any greenhouse-gas emitting facility would finally enable carbon removal technologies to mature and proliferate across the country. Under such a provision, any non-industrial actor or “qualified removal actor” would receive per-unit tax credits for “qualified removed carbon oxide,” defined as “carbon dioxide or other carbon oxide which is removed from the ambient air by a technology that artificially works to draw-down the volume of atmospheric CO₂.” Carefully tailoring the definition and parameters of a “qualified removal actor” and “qualified removed carbon oxide” would discourage greenhouse gas emitting facilities from attempting to abuse this credit to further subsidize their activities.^[167] Such a stepped-up carbon removal tax credit would also finally acknowledge, through policy, the substantial additional benefits that carbon removal confers to the greater global society.

2. Crediting a Metric Ton of Qualified Removed CO₂

A tax credit program for qualified removal actors would likely be best designed to award credits on a per-metric-ton basis. The current Section 45Q credits for carbon capture are computed per metric ton of qualified carbon oxide, with some variations dependent upon whether the captured carbon oxide is subsequently sequestered in secure geological storage or is instead used by the taxpayer in an EOR project or another qualified industrial use.^[168] Taxpayers who dispose of captured carbon oxide into secure geological storage receive a higher credit per ton than those who utilize the oxide for EOR or other qualified uses.^[169] To maintain consistency with the framework of Section 45Q, a stepped-up credit for qualified removed carbon oxide could similarly be computed on a per-metric-ton basis, with some variance in the credit’s value depending upon whether the removed carbon oxide is geologically sequestered or used in some other qualified manner.

The program’s offered credits for qualified removed carbon oxide could also vary in value based upon the taxpayer’s type of carbon removal strategy to reflect differences in the social value of various strategies.^[170] For example, at a minimum, separately structured credits would be needed for natural and mechanical CO₂ removal given the substantial differences in the nature of these strategies and how their removal of carbon might be measured.^[171] The energy efficiency of a NET is another important factor impacting its social value and should, thus, likely also impact the size of tax credit for which it is eligible.^[172] Other potentially relevant factors in determining the value of a removal credit include their land footprint or any associated environmental costs or risks.^[173]

Offering higher tax credits for qualified removed carbon oxide than for captured carbon would likewise reflect the greater societal value of carbon removal and make it more economically viable in spite of its relatively high costs. The costs of constructing and operating carbon removal facilities remain high, largely impeding removal technologies from widespread deployment.^[174] Just as 45Q presently offers different credit values to taxpayers depending on how captured carbon oxides are securely disposed, carbon removal credits could be of greater value than capture credits and could likewise vary in value offered depending on whether the removed carbon is placed in secure geological storage or put to alternative uses.

C. Facilitating Removed Carbon Offset Markets

While special federal tax incentives that reward carbon removal would stimulate greater private investment into removal technologies, laws that facilitate the emergence of markets for standardized removed carbon oxide certificates are also crucial to help grow this industry. Markets through which private actors can exchange money for certified, standardized carbon removal activities on a per metric ton basis would finally reward carbon removers for enough of the benefits of carbon removal to make it economically viable.^[175]

1. Promoting Transparency and Deterring Abuses

Federal and state governments can assist in promoting the emergence of carbon removal markets by tailoring regulations that promote transparency, require consistent accounting and monitoring procedures, and otherwise deter abuses and fraudulent activities within such markets. Designating an agency, such as DOE or Environmental Protection Agency, to manage federal inspection, reporting, and monitoring programs for carbon removal and storage projects would assure would-be market participants that carbon removal certificates sold in established marketplaces are legitimate and third-party verified. For example, routine inspections to verify the continued operational status of removal projects or to monitor permanent sequestration sites could mitigate uncertainty about authenticity of tradeable carbon removal certificates.

Reliably enforced federal regulatory structures for carbon removal markets would benefit removal stakeholders in multiple ways. Certification and monitoring programs could deter carbon capturers from attempting to “greenwash” by using removal devices to offset their carbon emission or from double-dipping by claiming stepped-up removal credits rather than capture credits.^[176] A well-regulated removed carbon market could also ensure that qualified carbon removers receive appropriate credit and certification for their activities and could assure private investors and lenders that carbon removal development projects are viable and worthy of financing.^[177]

2. Reflecting the True Value of Negative Emission Benefits

The ultimate goal and hope for creating a delineation between captured carbon and removed carbon is that, through the stimulation of financial incentives, a natural marketplace in which removed carbon credits are traded and valued may emerge. Once a monetary value naturally emerges for a metric ton of removed carbon oxide, the need for and deployment of carbon removal projects will rise precipitously. Removal of CO₂ from the atmosphere and associated removal credits may naturally create a tradeable market as offset credits or emission reduction credits which may be used in programs that limit or require emission reductions.

Creating a removed carbon oxide credit program could be the most effective market to create demand for removal activities if it worked in such a manner that stakeholders—currently receiving little to no economic benefit for their removal—could now have a credit used to convey a net climate benefit from one entity to another. Such an offset program could use language in common with 45Q to distinguish qualified facilities and technologies, as previously described. Such language is highly valuable to the creation of an offset market because of the standardization across a national and international marketplace. For such a removed carbon oxide credit market to be successful, it is imperative that national policymakers craft laws that facilitate the emergence of markets for standardized removed carbon oxide certificates. Additionally, as previously mentioned, regulatory deficiencies, including the permanence problem, and liability risks need to be addressed for the ultimate success of a unified and stabilized market.

By supporting the emergence of markets that provide substantial monetary rewards for certified carbon removal activities on a per metric ton basis, the federal government could finally establish such removal as a valuable, measurable asset with substantial positive climate benefits. Robust removed carbon offset markets could help to transform climate change mitigation into a promising business opportunity worthy of pursuit and of private investment. Such markets for standardized units of removed carbon oxide could finally enable removers to profit from their activities and could allow carbon removal to assume its role as a key global warming mitigation strategy.

Conclusion

Carbon removal technologies are poised to provide climate mitigation benefits in ways that existing climate technologies, policies, and markets currently fail to achieve. Federal policies and subsidies championed by fossil fuel industry stakeholders have historically heavily favored carbon capture, indirectly hindering the advancement of carbon removal strategies. Unlike carbon capture, which captures carbon at an emission source, carbon removal involves the direct removal of carbon from the ambient atmosphere to produce net decreases in atmospheric CO₂ levels. Policies that largely conflate carbon removal and carbon capture have resulted in the systematic underfunding of carbon removal research and development for decades, slowing the nation’s effort to reduce its net greenhouse-gas emissions.

Fortunately, it is relatively easy for Congress and federal agencies to remedy their history of under-supporting carbon removal through new policies that clearly define it, specifically reward it, and facilitate the emergence of private markets through which units of carbon removal may be bought and sold. In particular, Congress could amend Section 45Q of the Internal Revenue Code to create a stepped-up credit for carbon removal, thereby greatly increasing the federal subsidization of removal activities to better reflect the unique social benefits these activities provide. Congress and federal agencies could likewise establish clear standards and monitoring procedures for carbon removal and the storage of removed carbon, thereby supporting the growth of private marketplaces for carbon removal certificates. Such markets would enable corporations to offset their carbon-emitting activities by directly purchasing certificates and creating market demand for carbon removal, and thereby attracting far more private capital into this new industry. By financially rewarding carbon removers through these tax credits and markets, Congress would finally enable negative emissions technologies to assume a meaningful role in the nation’s urgent transition to a carbon-free energy system.

1. This Article was researched and written under the supervision and guidance of Professor Troy A. Rule as part of the Sandra Day O’Connor College of Law’s Sustainability Law Research Fellowships initiative. The authors wish to thank Professor Rule for his extraordinary level of dedication, care, and encouragement throughout this endeavor. In addition, the authors wish to thank the other Fellows within the initiative and faculty at ASU’s Center for Negative Carbon Emissions for their invaluable input on early stages of this Article. ↑
2. * Sustainability Law Student Research Fellow, Program on Law and Sustainability, Arizona State University Sandra Day O’Connor College of Law (J.D., 2022). B.A. Earth and Environmental Studies, Arizona State University (2019). ↑
3. ** Sustainability Law Student Research Fellow, Program on Law and Sustainability, Arizona State University Sandra Day O’Connor College of Law (J.D., 2022). B.S. Environmental Science, University of California Santa Barbara (2017). ↑
4. See Skip Derra, Popular Science picks ASU professor’s ‘MechanicalTree’ as a 2019 top technology, ASU News (Dec. 5, 2019), https://news.asu.edu/20191205-popular-sci ence-picks-lackner-mechanicaltree-2019-top-technology. ↑
5. Id. ↑
6. Id. ↑
7. Id. ↑
8. Id. See Jeff Fromm, Arizona State And Carbon Collect Bring Innovation To Sustainability, Forbes (Feb. 24, 2022), https://www.forbes.com/sites/jefffromm/2022/02 /24/arizona-state-and-carbon-collect-bring-innovation-to-sustainability/?sh=1f611be551da. ↑
9. See Explaining Carbon Removal, Am. Univ.: Inst. for Carbon Removal L. & Pol’y, https://www.american.edu/sis/centers/carbon-removal/explaining-carbon-removal .cfm (last updated Mar. 10, 2020) [hereinafter Explaining]. ↑
10. See Paris Agreement to the U.N. Framework Convention on Climate Change, Dec. 12, 2015, 3156 U.N.T.S. ↑
11. About, Carbon Takeback, https://carbontakeback.org/about/ (last visited Dec. 16, 2021). ↑
12. Albert C. Lin, Carbon Dioxide Removal After Paris, 45 Ecology L.Q. 533, 535 (2019).  ↑
13. See Mahmoud Abouelnaga, Ctr. for Climate and Energy Solutions, Carbon Dioxide Removal: Pathways and Policy Needs 1 (2021), https://www.c2es .org/wp-content/uploads/2021/06/carbon-dioxide-removal-pathways-and-policy-needs.pdf. ↑
14. Marc Campopiano & Tim Henderson, Carbon Capture and Sequestration Projects Benefit from Enhanced Oil Recovery, 43 Env’t L. Rep. News & Analysis 10234, 10234 (2013). ↑
15. Id. at 10235. ↑
16. See Leslie Kaufman & Eric Roston, Global Warming Is Outrunning Efforts to Protect Human Life, Scientists Warn, Bloomberg (Feb. 28, 2022), https://www.bloom berg.com/news/features/2022-02-28/ipcc-report-un-scientists-warn-of-closing-window-to-ready-for-hotter-world (describing the 2022 IPCC’s Sixth Assessment Report conclusion that the speed of global warming now exceeds the pace of efforts to protect the world’s most vulnerable populations and any further delays to cutting emissions will become “increasingly costly, for physical and economic reasons.”). ↑
17. Today in Energy, U.S. Energy Info. Admin. (Sept. 30, 2019), https://www.eia.gov /todayinenergy/detail.php?id=41493.  ↑
18. Global carbon dioxide emissions are set for their second-biggest increase in history, IEA (Apr. 20, 2021), https://www.iea.org/news/global-carbon-dioxide-emissions-are-set-for-their-second-biggest-increase-in-history. ↑
19. Id. ↑
20. UNFCCC: Climate commitments ‘not on track’ to meet Paris Agreement Goals, Climate Action (Mar. 2, 2021), https://www.climateaction.org/news/unfccc-climate-commitments-not-on-track-to-meet-paris-agreement-goals; “Climate Commitments Not On Track to Meet Paris Agreement Goals” as NDC Synthesis Report is Published, U.N. Climate Change (Feb. 26, 2021), https://unfccc.int/news/climate-commitments-not-on-track-to-meet-paris-agreement-goals-as-ndc-synthesis-report-is-published. ↑
21. IPCC report: ‘Code red’ for human driven global heating, warns UN chief, U.N. News (Aug. 9, 2021), https://news.un.org/en/story/2021/08/1097362. ↑
22. Secretary-General’s statement on the IPCC Working Group 1 Report on the Physical Science Basis of the Sixth Amendment, U.N. Sec’y-Gen. (Aug. 9, 2021), https://www.un.org/sg/en/content/secretary-generals-statement-the-ipcc-working-group-1-report-the-physical-science-basis-of-the-sixth-assessment. ↑
23. See IEA, supra note 16. ↑
24. See Anthony E. Chavez, Using Renewable Portfolio Standards to Accelerate Development of Negative Emissions Technologies, 43 Wm. & Mary Env’t L. & Pol’y Rev. 1, 5 (2018). ↑
25. See id. ↑
26. Leslie Kaufman, With New Urgency, Climate Scientists Recommend Carbon Removal, Bloomberg (Aug. 12, 2021), https://www.bloomberg.com/news/articles/2021-08-12/with-new-urgency-climate-scientists-recommend-carbon-removal.  ↑
27. Chavez, supra note 22, at 5–6. ↑
28. See id. ↑
29. Angela C. Jones & Molly F. Sherlock, Cong. Rsch. Serv., IF11455, The Tax Credit for Carbon Sequestration (Section 45Q) 1 (2021); see also Nadine R. Hoffman, The Emergence of Carbon Sequestration: An Introduction and Annotated Bibliography of Legal Aspects for CCS, 29 Pace Env’t L. Rev. 218, 218 (2011). (An analysis of carbon sequestration as a viable tool in the race against climate change is not disputed in this Article, but it is nonetheless intricately involved with the goals of both carbon capture and carbon removal.) The following cited articles would provide any reader an adequate launching point for further understanding of carbon sequestration. See Donna M. Attanasio, Surveying the Risks of Carbon Dioxide: Geological Sequestration and Storage Projects in the United States, 39 Env’t L. Rep. News & Analysis 10376, 10378 (2009) (describing that carbon sequestration generally takes three forms: geologic sequestration, biological sequestration, or sequestration involving transformation for an alternative end use); see also What’s the difference between geologic and biologic carbon sequestration?, U.S. Geological Surv., https://www.usgs.gov/faqs/whats-difference-between-geologic-and-biologic-carbon-sequestration (last visited Dec. 28, 2021) (describing that for geologic sequestration, CO₂ is pressurized until it becomes a liquid and it is then injected into porous rock formations in geologic basins and that biological sequestration refers to the storage of atmospheric carbon in vegetation, soils, woody products, and aquatic environments, and it is achieved by encouraging and inducing the growth of certain large plants that naturally draw-down CO₂); see also Mary Ellen Ternes, Reduce, Reuse, and Recycle Carbon Dioxide, 32 Nat. Res. & Env’t 56, 56 (2018) (explaining that in lieu of permanent sequestration, many technologies are working to reinvent CO₂ into a valuable, reusable resource); see also Jason Franz, Carbon Collect’s MechanicalTree selected for US Department of Energy award, ASU News (July 2, 2021), https://news.asu.edu/20210702-carbon-collect-mechanicaltree-sele cted-us-department-energy-award (explaining that compressed into a gaseous form, CO₂ can be sold for reuse in a variety of applications such as synthetic fuels, food, beverage, and agricultural industries); see also Our Markets, Carbon Collect, https://mech anicaltrees.com/our-markets/ (last visited Dec. 29, 2021) (explaining that markets for “CO₂ monetization” include agriculture, food, beverage, steel manufacture, pharmaceuticals, and fire suppression to name a few). ↑
30. See Explaining, supra note 7. ↑
31. See David Morrow, Clarifying the overlap between carbon removal and CCUS, Am. Univ. Inst. for Carbon Removal L. & Pol’y Blog (Dec. 3, 2020), https://research .american.edu/carbonremoval/2020/12/03/clarifying-the-overlap-between-carbon-removal-and-ccus/.  ↑
32. See Explaining, supra note 7. Discussions about the efficiency and effectiveness of different carbon capture technologies and process are not central to the proposal in this Article, but generally readers may benefit from understanding the basic carbon capture processes. See generally Larry Nettles & Mary Conner, Carbon Dioxide Sequestration—Transportation, Storage, and Other Infrastructure Issues, 4 Tex. J. Oil, Gas & Energy L. 27, 30–31 (2008) (explaining that the most common methods for capturing CO₂ are pre-combustion, involving the reaction of fuel with oxygen and subsequent chemical absorption to generate CO₂, and post-combustion systems which separate CO₂ from flue gas using chemical solvents. Pre-combustion is most widely developed because of its adaptability for facilities using coal or oil, and its ability to produce a higher concentration of CO₂, however, post-combustion remains as a prevalent capture method because such technologies can be used for retrofitting existing facilities without major rebuilds). ↑
33. See Explaining, supra note 7. ↑
34. See id. ↑
35. Id. ↑
36. Austin Lee et al., The Way Forward: A Legal and Commercial Primer on Carbon Capture, Utilization, and Sequestration, 16 Tex. J. Oil Gas & Energy L. 43, 67 (2021).  ↑
37. See Russell W. Murdock, The State of CO2 Sequestration in the State of Texas, 41 Tex. Env’t. L.J. 65, 67 (2010) (the largest stationary sources of CO₂ in the United States, coal-fired power plants, are the leading users of carbon capture technologies). ↑
38. See id. ↑
39. See Lin, supra note 10, at 562–63. ↑
40. Id.; Murdock, supra note 35, at 67–68. ↑
41. See Campopiano & Henderson, supra note 12, at 10234. ↑
42. See id. ↑
43. See Murdock, supra note 35, at 68. ↑
44. Lee et al., supra note 34, at 55. ↑
45. Campopiano & Henderson, supra note 12, at 10234. ↑
46. See Murdock, supra note 35, at 68; see also Campopiano & Henderson, supra note 12, at 10234. ↑
47. See Gary McWilliams, Factbox: Energy firms seize on carbon tech, environmental goals to build new businesses, Thomson Reuters (Mar. 15, 2021), https://today.west law.com/Document/I7130bc20859611eba824a01d1c1bf194/View/FullText.html?transitionType=Default&contextData=(sc.Default)&VR=3.0&RS=cblt1.0; see also Jessica Resnick-Ault, Occidental CEO calls for new U.S. laws to boost carbon capture, Thomson Reuters (Sept. 12, 2019), https://today.westlaw.com/Document/I3bbbbcf0d59a11e99f69 cd549a220e28/View/FullText.html?transitionType=Default&contextData=(sc.Default)&VR=3.0&RS=cblt1.0. ↑
48. Explaining, supra note 7. ↑
49. Lin, supra note 10, at 536. ↑
50. See Lee et al., supra note 34, at 67; see also Explaining, supra note 7. ↑
51. See Explaining, supra note 7. ↑
52. See Anthony E. Chavez, Lessons from Renewable Energy Diffusion for Carbon Dioxide Removal Development, 32 Fordham Env’t L. Rev. 46, 50 (2020) [hereinafter Lessons]; Chavez, supra note 22, at 8. ↑
53. Lessons, supra note 50, at 50–51; see also Explaining, supra note 7. ↑
54. Lessons, supra note 50, at 50–51. ↑
55. Explaining, supra note 7. ↑
56. Id. ↑
57. See id. ↑
58. Id. ↑
59. Id. ↑
60. Lessons, supra note 50, at 53. ↑
61. Explaining, supra note 7. ↑
62. Id. ↑
63. Id. ↑
64. Id. ↑
65. Id. ↑
66. See Lessons, supra note 50, at 51. ↑
67. See Explaining, supra note 7. ↑
68. See id. ↑
69. See supra Introduction. ↑
70. See Abouelnaga, supra note 11, at 1. ↑
71. Lin, supra note 10, at 537–38; see also Tracy Hester, Legal Pathways to Negative Emissions Technologies and Direct IR Capture of Greenhouse Gasses, 48 Env’t L. Rep. News & Analysis 10413, 10416 (2018).  ↑
72. See Chavez, supra note 22, at 6. ↑
73. See id. at 13–14. ↑
74. Id. at 14–15. ↑
75. Id. at 15; Lin, supra note 10, at 540. ↑
76. See Lin, supra note 10, at 540. ↑
77. See Hester, supra note 69, at 10417. ↑
78. Nikolaj Skydsgaard, World’s largest plant capturing carbon from air starts in Iceland, Reuters (Sept. 13, 2021), https://www.reuters.com/business/environment/ worlds-largest-plant-capturing-carbon-air-starts-iceland-2021-09-08/.  ↑
79. Id. ↑
80. See Fromm, supra note 6. ↑
81. Id. ↑
82. See id. ↑
83. See Derra, supra note 2; see also MechanicalTrees, Carbon Collect, https:// mechanicaltrees.com/mechanicaltrees/ (last visited Dec. 27, 2021). ↑
84. Derra, supra note 2. ↑
85. Fromm, supra note 6. ↑
86. See Lin, supra note 10, at 562. ↑
87. See Zen Makuch et al., Innovative Regulatory and Financial Parameters for Advancing Carbon Capture and Storage Technologies, 32 Fordham Env’t L. Rev. 1, 44 (2020).  ↑
88. Lin, supra note 10, at 563. ↑
89. See Makuch et al., supra note 85, at 1–2. ↑
90. David Jordan, Carbon capture critical to climate goals, International Energy Agency says, CQ Roll Call Wash. Energy Briefing (Sept. 25, 2020), https:// 1.next.westlaw.com/Document/I100e7ec4ff5c11eabea4f0dc9fb69570/View/FullText.html?originationContext=typeAhead&transitionType=Default&contextData=(sc.Default). ↑
91. See Intergovernmental Panel on Climate Change Working Grp. III, IPCC Special Report on Carbon Dioxide Capture & Storage 4 (2005) [hereinafter Intergovernmental] (facilities that subsequently compress, transfer, and store the resulting gas can reduce emissions by approximately eighty to ninety percent). ↑
92. Int’l Energy Agency, About CCUS, IEA (Apr. 2021), https://www.iea.org/repo rts/about-ccus. ↑
93. See id. (plans for over thirty new carbon capture projects have been announced within the last five years, which could more than triple the amount of global capture capacity once in operation). ↑
94. Intergovernmental, supra note 89, at 4. ↑
95. See James Temple, Carbon removal hype is becoming a dangerous distraction, MIT Tech. Rev. (July 8, 2021), https://www.technologyreview.com/2021/07/08/102 7908/carbon-removal-hype-is-a-dangerous-distraction-climate-change/.  ↑
96. See Samuel Brown et al., Carbon Capture: A Piece of the Climate Puzzle, Nat. Res. & Env’t 50, 51 (2021), https://www.americanbar.org/groups/environment_energy_ resources/publications/natural_resources_environment/2020-21/spring/; Murdock, supra note 35, at 67; Hoffman, supra note 27, at 218, ↑
97. See Lee et al., supra note 34, at 55. ↑
98. See Resnick-Ault, supra note 45; see also Elvina Naqaguna, Senators urged to back carbon capture, nuclear for climate strategy, CQ Roll Call Wash. Energy Briefing (Feb. 28, 2019), https://1.next.westlaw.com/Document/I8320f6853ba811e9ad fea82903531a62/View/FullText.html?originationContext=typeAhead&transitionType=Default&contextData=(sc.Default) (explaining that the IEA has asserted that fossil fuels, including oil and natural gas, will remain a key part of global energy systems for the foreseeable future). ↑
99. See McWilliams, supra note 45. ↑
100. Id.; Resnick-Ault, supra note 45. ↑
101. See Andy Rowell & Lorne Stockman, Capture: Five Decades of False Hope, Hype, and Hot Air, Oil Change Int’l (June 17, 2021), http://priceofoil.org/2021/06/17/carbon-capture-five-decades-of-industry-false-hope-hype-and-hot-air/ (describing that the oil industry is highly skilled at getting the federal government to subsidize and de-risk its investments). ↑
102. See Resnick-Ault, supra note 45. ↑
103. Makuch et al., supra note 85, at 30; see Lin, supra note 10, at 564–65 (describing that financial federal support for carbon capture technologies have come in the form of demonstration projects, tax credits, loan guarantees, and the creation of industry-friendly regulatory policies). ↑
104. See Naqaguna, supra note 96. ↑
105. See Troy A. Rule, Solar, Wind, and Land: Conflicts in Renewable Energy Development 3 (2014). ↑
106. Kelly Johnson et al., Bipartisan Infrastructure Bill Invests Billions in CCUS, JD Supra: Holland & Hart (Nov. 22, 2021), https://www.jdsupra.com/legalnews/bipar tisan-infrastructure-bill-invests-9111801/. ↑
107. Id. ↑
108. See Ashley J. Lawson, Cong. Rsch. Serv., IF11861, Funding for Carbon Capture and Carbon Removal at DOE (2021) (describing that DOE’s carbon capture research and development activities date back to at least 1997, while it is only recently that Congress has recommended DOE to expand its focus to include some types of CDR). ↑
109. See Lin, supra note 10, at 533. ↑
110. See id. at 535 (the general public is, even more so, largely unaware of the need for and benefits of aggressive carbon removal); Hester, supra note 69, at 10416. ↑
111. See Chavez, supra note 22, at 20; see generally Ashley J. Lawson [SC], Cong. Rsch. Serv., IF11501, Carbon Capture Versus Direct Air Capture (2021) (explaining that direct air capture has not been a focus area for DOE research historically, but more recently, Congress has recommended various research and development activities in recent appropriations). ↑
112. See Angela C. Jones & Ashley J. Lawson, Cong. Rsch. Serv., R44902, Carbon Capture and Sequestration (CCS) in the United States 13 (2021). ↑
113. See Lawson, supra note 106 (providing a comparison of funding for carbon capture and carbon removal research and development activities at DOE, showing that the authorized DOE budget for carbon capture in the fiscal year 2022 was $1,030 million, while for CO₂ removal it was $63.5 million). ↑
114. See Johnson et al., supra note 104. ↑
115. See Corbin Hilar, The cash behind carbon removal: Big Oil, tech, and taxpayers, E&E News (Dec. 17, 2021), https://www.eenews.net/articles/the-cash-behind-carbon-rem oval-big-oil-tech-and-taxpayers/; see also CJ Clouse, Direct air capture is ready for its closeup, GreenBiz (Dec. 29, 2021), https://www.greenbiz.com/article/direct-air-capture-ready-its-closeup (“For the first time, the federal government is throwing some serious cash at direct air capture, in an effort to scale the sector and reduce the cost.”). ↑
116. See Hilar, supra note 113; see also Justin Gerdes, US Policymakers pave the way for carbon removal, Energy Monitor (Dec. 21, 2021), https://www.energymonitor.ai /tech/carbon-removal/us-policymakers-pave-the-way-for-carbon-removal (describing that the DOE has recently recognized that carbon removal technology still requires significant investments in research and development to create cost-effective and economically viable technology that can be deployed at scale). ↑
117. See Rule, supra note 103, at 3. ↑
118. See Chavez, supra note 22, at 6–8. ↑
119. See Lessons, supra note 50, at 53; see Clouse, supra note 113. ↑
120. See Jonas J. Monast et al., A Cooperative Federalism Framework for CCS Regulation, 7 Env’t & Energy L. & Pol’y J. 1, 36 (2012); see also Sandra Eckert & Richard McKellar, Securing Rights to Carbon Sequestration: The Western Australian Experience, 8 Sustainable Dev. L. & Pol’y 30 (2008).  ↑
121. See generally Ian Havercroft, Lessons and Perceptions: Adopting a Commercial Approach to CCS Liability, Global CCS Inst. 16 (2019), https://www. globalccsinstitute.com/wp-content/uploads/2019/08/Adopting-a-Commercial-Appraoch-to-CCS-Liability_Thought-Leadership_August-2019.pdf. ↑
122. See id. at 9. ↑
123. See generally id. (there are two forms of post-injection liability: local liability, relating to harm to the environment, surrounding property, and human health and climate liability, which relates to associated effects on climate change as a result of leakage from carbon sequestration reserves). ↑
124. See id. at 6–7. ↑
125. See id. ↑
126. See generally Mark de Figueiredo et al., The Liability of Carbon Dioxide Storage, MIT https://sequestration.mit.edu/pdf/GHGT8_deFigueiredo.pdf (last visited Mar. 8, 2022). ↑
127. See id. at 2, 4. ↑
128. Wash. Admin. Code § 463-85-110 (2008). ↑
129. See Lin, supra note 10, at 580. ↑
130. See Pacific Northwest National Laboratory, Cheaper Carbon Capture Is on the Way – Marathon Research Effort Drives Down Cost, SciTechDaily (Mar. 19, 2021), https://scitechdaily.com/cheaper-carbon-capture-is-on-the-way-marathon-research-effort-drives-down-cost/#:~:text=At%20a%20cost%20of%20%24400,according%20to%20a% 20DOE%20analysis. ↑
131. See Michael Rodgers & Brandon Dubov, US tax credit encourages investment in capture and storage, White & Case LLP (Jan. 29, 2021), https://www.whitecase. com/publications/insight/carbon-capture/us-tax-credit-encourages-investment. ↑
132. See Cap and Trade Basics, Ctr. for Climate & Energy Sols., https://www. c2es.org/content/cap-and-trade-basics/ (last visited Jan. 22, 2022). ↑
133. See Policy Basics: Policies to Reduce Greenhouse Gas Emissions, Ctr. on Budget & Pol’y Priorities, https://www.cbpp.org/research/policies-to-reduce-green house-gas-emissions (last updated Dec. 21, 2015). ↑
134. See How cap and trade works, Env’t Def. Fund, https://www.edf.org/climate/ how-cap-and-trade-works (last visited Jan. 4, 2022). ↑
135. See Rodgers & Dubov, supra note 129 (describing that LCFS allows projects to qualify for credits and trade them within the LCFS credit trading market; this market provides financial incentives and a potential revenue stream for CCUS projects in the state). ↑
136. See id. (describing favorable economic incentives, such as severance tax reductions, sales tax exemptions, and tax credits for carbon capture and sequestration projects involving EOR). ↑
137. See Jones & Sherlock, supra note 27. ↑
138. See id.; Shannon Zaret, Can the Expansion of 45Q Effectively Spur Investment in Carbon Capture?, 19 Sustainable Dev. L. & Pol’y 14, 15 (2019). ↑
139. See generally Jones & Sherlock, supra note 27. ↑
140. See John C. Dernbach, The Dozen Types of Legal Tools in the Deep Decarbonization Toolbox, 39 Energy L.J. 313, 333 (2018). ↑
141. See Zaret, supra note 136, at 15. ↑
142. See Jones & Sherlock, supra note 27. ↑
143. See Jennifer Christensen, Before & After: How the FUTURE Act Reformed the 45Q Carbon Capture and Storage Tax Credit, Great Plains Inst. (Mar. 5, 2018), https://www.betterenergy.org/blog/future-act-reformed-45q-carbon-capture-storage-tax-credit/ (discussing that these amendments included extensions of the §45Q credit to additional beneficial uses such as EOR, an increased credit value, a clearer timeframe for construction of qualifying projects, expanded eligibility to more facilities and industries, and the elimination of any credit cap); see also S.986, 117th Cong. (2021) (additionally, the Carbon Capture, Utilization, and Storage Tax Credit Act of 2021 – introduced in the Senate March 25, 2021 – aims to extend the project construction qualifying date by five years, increase the value of direct air capture, and provide direct payment for the tax credit). ↑
144. 26 U.S.C. § 45Q(c)(1)(C) (2021). ↑
145. See § 45Q(d) (describing that the credit is available to “qualifying facilit[ies]” for which the project begins construction before January 1, 2026, and captures qualified carbon oxide of a certain metric ton depending on facility type—emitting facility, electric facility, or direct air capture). ↑
146. See Carbon Capture, Use, and Sequestration: Proposed Regulations Enable Taxpayers to Accelerate Projects, JD Supra: Akin Gump Strauss Hauer & Feld LLP (June 4, 2020), https://today.westlaw.com/Document/I702fceb0a6ee11ea91c0d5c30860 ec6d/View/FullText.html?transitionType=Default&contextData=(sc.Default)&VR=3.0&RS=cblt1.0; Jones & Sherlock, supra note 27. ↑
147. § 45Q(c)(1). ↑
148. See Monast et al., supra note 118, at 13. ↑
149. See Lin, supra note 10, at 565–67 (describing that a “wait and see” approach to implementing carbon removal policy would turn a “blind eye” to the tremendous gap between the infant state of carbon removal development and the global-scale of carbon removal implementation assumed in the Paris Agreement); cf. Chavez, supra note 22 (proposing that development and implementation of NETs could be advanced by Renewable Portfolio Standards which have already proven to facilitate the investment in and development of renewable energy technologies). ↑
150. See Temple, supra note 93 (discussing the suggestion that carbon removal needs to be separated from the goal of emissions reductions and the government could help by creating separate targets to ensure that carbon removal does not count toward emissions reductions goals); Hester, supra note 69, at 10430 (describing that incentives for carbon removal exist in the shadow of carbon capture, or not at all). ↑
151. See Dernbach, supra note 138, at 332 (proposing that to some degree, existing laws concerning decarbonization strategies favor some sources of energy, such as fossil fuels, over others, which has resulted in a barrier to market entry for other strategies such as renewable energy tools and potentially contributed to higher greenhouse-gas emissions than would have otherwise occurred); Hester, supra note 69, at 10428 (describing that current federal environmental laws and policies do not explicitly endorse or promote the development and deployment of NETs, and to make NETs more feasible as an option to aid decarbonization efforts, the federal government should provide an explicit preference for research, development, and implementation of NETs through congressional directives in statutory language); Jones & Lawson, supra note 110, at 13 (explaining that despite the differences between carbon capture and direct air capture technologies, Congress has sometimes combined support for the two into single proposals). ↑
152. See Narayan S. Subramanian, Powering the Future: An Inclusive National Clean Energy Standard with Negative Emissions Technologies, 45 Colum. J. Env’t L. 631, 665–66 (2020) (proposing that the definition as to what constitutes “NETs” must be clearly defined and leave room for new technologies that have not yet proven to be viable, in order to include NETs within the scheme of a national clean energy standard). ↑
153. See David R. Morrow & Michael S. Thompson, Reduce, Reuse, Recycle: Clarifying the Overlap between Carbon Removal and CCUS (Inst. for Carbon Removal L. & Pol’y Working Paper No. 2, 2020), http://research.american.edu/carbonremoval/wp-content/uploads/sites/3/2020/12/reduce-remove-recycle_final.pdf (proposing that to understand the roles that carbon removal and carbon capture can play in climate policy, there should be less of a focus upon technological categories, and a greater emphasis upon where the captured carbon comes from and where it goes). ↑
154. See Lessons, supra note 50, at 50 (describing CO₂ removal as a range of practices and technologies that can reduce the amount of CO₂ in the atmosphere); Chavez, supra note 22, at 8; Lin, supra note 10, at 536. ↑
155. See Subramanian, supra note 150, at 665–67. Such a broadly written definition could arguably encompass natural strategies, such as reforestation, which may be more challenging to accurately quantify, thereby presenting the question of whether natural CO₂ removal strategies could or even should be grouped together with mechanical strategies, which incorporate quantification of their removal as part of their systems. ↑
156. See Explaining, supra note 7; Chavez, supra note 22, at 8 (explaining that NETs and CO₂ removal are used interchangeably); Lin, supra note 10, at 536 (defining CO₂ removal and negative emissions technologies as one concept). ↑
157. See Subramanian, supra note 150, at 666. ↑
158. See id. ↑
159. See id. David Morrow & Michael Thompson, Why Orca matters: long-term climate policy and Climeworks’ new direct air capture facility in Iceland, Am. Univ. Inst. for Carbon Removal L. & Pol’y Blog (Sept. 10, 2021), https://research.american. edu/carbonremoval/2021/09/10/why-orca-matters-the-point-of-climeworks-new-direct-air-capture-facility-in-iceland/ (in the past decade alone, various federal efforts to incentivize the early development of emerging technologies through tax credits, favorable depreciation or loan guarantees to investors have helped new technologies grow and reach economies of scale). See also Jonathan L. Ramseur et al., Cong. Rsch. Serv., IF11791, Mitigating Greenhouse Gas Emissions: Selected Policy Options (2021) (describing that tax credits or other types of tax incentives can encourage business investment in certain greenhouse-gas mitigating technologies, such as carbon capture, thereby helping to accelerate their adoption, and proposing that a range of policy tools could support carbon removal efforts, but that the most powerful concept which could accelerate private-sector research and deployment of NETs would be the imposition of a carbon tax, as it would expressly allow operators to obtain a financial return on the CO₂ they capture from the atmosphere). ↑
160. See Zaret, supra note 136; supra Part II. D. ↑
161. See 26 U.S.C. §45Q(c)(1)(c); Christensen, supra note 141. ↑
162. See Hester, supra note 69, at 10416 (describing the extension of financial support for DAC projects to be a significant new source of funding as well as an indication of critical government and commercial endorsement for the development of DAC technologies). ↑
163. See Dernbach, supra note 138, at 335; Jones & Lawson, supra note 110, at 23 (describing that some argue that carbon capture supports continued reliance on fossil fuels, which runs counter to reducing greenhouse gas emissions and other environmental goals). ↑
164. §§ 45Q(c)(1)(i)–(ii), (d). See also Jones & Sherlock, supra note 27. ↑
165. § 45Q(e)(1)(A). ↑
166. See supra Part I.A.2. ↑
167. See Jones & Sherlock, supra note 27 (describing that Members of Congress have recently raised concerns about potentially fraudulent 45Q tax credit claims and, in future modification, Congress may consider whether the IRS has adequately addressed concerns about improper claims through its responses, guidance, and recent 45Q regulations). ↑
168. See §§ 45Q(a)(1)–(4), (f)(5) (defining the utilization of qualified carbon oxide to mean either (i) the fixation of such qualified carbon oxide through photosynthesis or chemosynthesis, (ii) the chemical conversion of such qualified carbon oxide to a material or chemical compound in which it would be securely stored, or (iii) the use of qualified carbon oxide for any other purpose for which a commercial market exists); Jones & Sherlock, supra note 27 (the credit amount per metric ton of CO₂ is divided between equipment placed into service before Feb. 9, 2018, or equipment placed into service on or after Feb. 9, 2018, however the reasoning behind this differing credit value is not relevant to this Article). ↑
169. §§ 45Q(a)(1)–(4); Angela C. Jones, Cong. Rsch. Serv., IF11639, Carbon Storage Requirements in the 45Q Tax Credit (2021) (describing that in the tax year 2020, Section 45Q provided tax credits for equipment placed in service on Feb. 9, 2018 or later, of $31.77 per ton for carbon oxide that was injected for sequestration and $20.22 per ton for carbon oxide that was stored during EOR or used for other qualified industrial processes, and such credits are projected to increase to $50 and $35 per ton, respectively, by 2060). ↑
170. As described in Part I, mechanical removal strategies vary in the manner in which they work to draw-down atmospheric CO₂, and therefore, providing a higher-valued credit for strategies which expand less energy could better encourage investment into and use of technologies that help society move closer toward a carbon-free economy. See supra Part I.A.2; Subramanian, supra note 150, at 656 (describing the concept of valuation of generation NET resources and non-generation NET resources, a unique issue that arises with some forms of NETs). ↑
171. See supra Figure 1: Natural and Mechanical CO₂ Removal. ↑
172. See Lin, supra note 10, at 540 (describing that DAC has comparatively high costs because most currently available technologies use a great deal of energy to capture CO₂ from the ambient air, and while DAC could use renewable energy to power its operations in order to reduce its carbon footprint, it would require a significant amount of land in exchange). ↑
173. The authors are aware that the valuation of such largely intangible factors will not be easy to calculate. Extensive studies are needed to best prescribe a value upon these factors amongst the variety of carbon removal strategies. ↑
174. See Jones & Lawson, supra note 110, at 13 (describing that a recognized drawback of DAC systems is their high cost per ton of CO₂ captured, compared to more conventional carbon capture technologies, with one estimate valuing the difference to be $123 per ton); Hester, supra note 69, at 10417 (describing that the resulting removed CO₂ from NETs needs to have sufficient economic value to offset the cost of collecting, processing, and managing the ambient air streams and CO₂). ↑
175. See Hester, supra note 69, at 10425 (tradable credits could be used in programs that limit or require emissions reductions, like the CAA National Ambient Air Quality Standards program); see also The Nature Conservancy, Carbon Offsets, Illustrated, Glob. Insights Newsl. (May 17, 2021), https://www.nature.org/en-us/what-we-do/our-insights/perspectives/carbon-offsets-markets-illustrated/ (carbon offsets involve reducing or removing greenhouse gases in one place in order to counteract for greenhouse emissions in another, and with a sufficient demand for offsets, carbon markets can either evolve voluntarily or within a scheme of regulatory compliance); see generally GHG Mgmt. Inst. & Stockholm Env’t Inst., What is a Carbon Offset?, Carbon Offset Guide, https: //www.offsetguide.org/understanding-carbon-offsets/what-is-a-carbon-offset/ (last visited Jan. 4, 2022). ↑
176. “Greenwashing” is a term used to describe scenarios in which corporations, typically in the practice of emitting a large volume of greenhouse-gas emissions as part of their operations, try to promote an outwardly “green” image of their business models by flaunting actions and practices of environmental stewardship, such as the purchase of carbon offset credits or the use of carbon capture equipment, while internally keeping their practices as normal. See generally Bruce Watson, The troubling evolution of corporate greenwashing, The Guardian (Aug. 20, 2016), https://www.theguardian.com/sustain able-business/2016/aug/20/greenwashing-environmentalism-lies-companies (describing greenwashing as the corporate practice of making diverting claims of sustainability to cover questionable environmental records). ↑
177. See Clouse, supra note 113 (a handful of carbon removal companies, such as Climeworks, are reaching a point at which their DAC technologies will be deployed at a commercial scale because of the private funding which they accepted); Hilar, supra note 113 (despite concerns over the motives of corporations investing in carbon removal, the reality is that massive funding from commercial industries and capital investors could be necessary to gain the groundwork funding for hundreds of removal projects); Alejandro De La Garza, Climate Experts Say Vacuuming CO2 From the Sky Is a Costly Boondoggle. The U.S. Government Just Funded It Anyway, Time (Dec. 2, 2021), https://time.com/6125303/d irect-air-carbon-capture-infrastructure/; Ragnhildur Sigurdardottir & Akshat Rathi, World’s Largest Carbon-Sucking Plant Starts Making Tiny Dent in Emissions, Bloomberg (Sept. 8, 2021), https://apple.news/At34J3uOHSuyGGpncCqTd7Q (Climeworks says it is “important for the company to remain independent from the strategic interests of the oil and gas companies, though it’s open to partnerships as long as that independence isn’t compromised.”). ↑