Hoeven: 45Q Tax Credit in Place to Help Coal Producers, Provide Important Revenue Stream

Senator Worked to Secure Final 45Q Regulation, Legislation to Extend Construction Deadline

BISMARCK, N.D. – Senator John Hoeven, a member of the Senate Energy and Natural Resources (ENR) Committee, today issued the following statement after securing two big advancements this month to put in place the 45Q tax credit to help coal producers. Specifically, the senator: 

  • Secured the final 45Q regulations from Treasury, which were announced last week. The senator has urged President Trump, White House Chief of Staff Mark Meadows, Treasury Secretary Steven Mnuchin and Energy Secretary Dan Brouillette to move the final regulations forward.
  • Passed legislation providing a two-year extension on the construction deadline for the 45Q tax credit.

“We’ve been working to put the 45Q tax credit in place to help our coal producers. We have now secured the final regulations from Treasury, and passed legislation extending the construction deadline to provide producers with more time to utilize the credit,” said Hoeven. “The 45Q tax credit is an essential revenue stream for our nation’s coal facilities, as well as oil producers and manufacturers, supporting good jobs in North Dakota and benefitting every home and business through a more resilient and reliable electricity grid. At the same time, this tax credit is an important part of our efforts to support the development of CCUS technologies, like Project Tundra, enabling our nation to continue utilizing its abundant coal reserves while also reducing emissions. That’s a win for our economy, environmental stewardship and America’s energy security.”

Last week, Treasury announced the final 45Q rule, which includes two provisions that Hoeven worked to secure to benefit coal facilities, enhanced oil and gas recovery (EOR) operations and project developers in North Dakota. Specifically, the rule includes a more flexible definition of Carbon Capture Equipment (CCE), providing broader eligibility for the tax credit. In addition, the rule includes a provision similar to Hoeven’s CO2 Regulatory Certainty Act, ensuring that the tax credit works both for long-term storage and enhanced oil recovery.

Moving forward, Hoeven is prioritizing the need to enhance both the 45Q tax credit and the 48A Advanced Coal tax credit in order to further support coal producers and CCUS development. To this end, the senator continues working to advance his Carbon Capture Modernization Act, bipartisan legislation to modernize the 48A tax credit for clean coal facilities to better support CO2 capture retrofit projects, like Project Tundra. Further, the senator helped introduce bipartisan legislation in the 116th Congress to: 

  • Provide a direct payment option for the 45Q and 48A CCUS tax incentives.
  • Further extend the 45Q commence construction deadline through January 1, 2029.
  • Allow the 45Q credit to offset tax obligations arising from the Base Erosion Avoidance Tax (BEAT), consistent with BEAT exceptions made for wind and solar energy production under the 2017 Tax Cuts and Jobs Act.