Parsing new carbon capture tax credits
A coal-fired plant in Baltimore, Maryland. Photo: Mark Wilson/Getty Images
University of Texas electricity expert Joshua Rhodes looked at how many power plants are poised to benefit from expanded carbon capture tax credits, per Forbes.
Why it matters: The credits in the February federal spending deal represented a rare bipartisan effort on climate policy, but whether they're attractive enough for use in the power sector (as opposed to other industrial facilities) remains a question.
The bottom line: In his report, he finds 27 coal-fired and natural gas combined cycle power plants within 10 miles of existing CO2 pipelines, which is important for cost purposes.
- "Of the 27 power plants we examined, it appears the economics might work for at least 22," he writes.
- "In fact, all nine coal plants now operating likely could make a profit by sequestering the CO2, or selling it off for [enhanced oil recovery]," he writes, adding that some plants could make as much as $3.7 billion over the 12-year life of the credit.
- Of the 21 gas plants on the list, he sees profits from using the credit for 12 of them, though only 5 of them would see profits via direct sequestration.