Hoeven: Treasury Issues 45Q Tax Credit Rules, Supporting Development of CCUS Technologies

45Q Tax Credit Will Provide Important Financial Help for Coal-Fired Electric Plants, Senator Worked to Advance Final Regulations to Provide Certainty to Project Developers

BISMARCK, N.D. – Senator John Hoeven, a member of the Senate Energy and Natural Resources (ENR) Committee, today issued the following statement after the U.S. Department of the Treasury issued rules implementing the 45Q tax credit, supporting the development of commercially-viable carbon capture, utilization and storage (CCUS) technologies. Last week at a meeting with President Trump, Hoeven outlined the importance of the 45Q tax credit directly with the President and Treasury responded and released the regulation today. 

“The 45Q tax credit creates an important revenue stream for coal-fired electric companies to help generate revenue. This a key part of our efforts to advance commercially-viable CCUS technology, benefitting a wide section of North Dakota’s energy industry, including coal-fired power plants, enhanced oil recovery operations and ethanol production,” said Senator Hoeven. “We’ve worked hard with the administration to get these rules out and ensure they work for project developers in our state. This will provide needed certainty to efforts like Project Tundra and those at Red Trail Energy’s ethanol plant, technologies which will help continue America’s energy dominance.” 

“Basin Electric appreciates Senator Hoeven’s diligent efforts to advance the 45Q tax credit and ensure that IRS regulations are workable for our industry. Basin Electric has strived to be a leader in finding cost-effective technology solutions to capture and sequester carbon dioxide. 45Q is a crucial incentive to help develop this complex technology and we are encouraged by the release of proposed IRS rules to allow for its use. We will continue to work with Senator Hoeven to get this over the finish line and look forward to the development of potential projects,” said Paul M. Sukut, CEO and General Manager, Basin Electric Power Cooperative.

This follows the issuance of the initial two pieces of the tax credit’s regulations in February, which the senator worked to advance after helping pass legislation to reform and expand the 45Q tax credit. The senator has also urged Energy Secretary Dan Brouillette and Treasury Secretary Steven Mnuchin, among others, to move the final regulations forward.

Today’s rule includes two provisions, which Hoeven worked to secure, that will benefit coal facilities, enhanced oil and gas recovery (EOR) operations, and project developers in North Dakota:

  • An expanded definition of Carbon Capture Equipment (CCE), providing broader eligibility for the tax credit, including for the state’s coal-fired power plants.
  • A provision, similar to Hoeven’s CO2 Regulatory Certainty Act, which ensures the tax credit works both for long-term storage and enhanced oil recovery.