There is broad consensus that both aggressive greenhouse gas emissions reductions and gigatons of carbon dioxide removal (CDR) will be needed to limit the rise in average global temperatures to below 2 degrees C above preindustrial levels. In addition to widespread deployment of nature-based CDR solutions like reforestation and agricultural soil management, new forms of engineered carbon removal (ECR) will also be necessary. ECR offers several advantages, such as larger removal and scalability potential, greater durability, and more locational flexibility. In recent years, there has been rapid growth in public and private investment in ECR technologies, including direct air capture (DAC), biomass with carbon removal and storage (BiCRS), enhanced rock weathering, and marine carbon dioxide removal, that has helped make many of these technologies commercially viable. However, the entire ECR industry will need to be rapidly scaled to achieve the gigaton levels of removal necessary to meet 2050 climate goals. To help meet this challenge, the Center for Climate and Energy Solutions (C2ES) has established a technology working group that convenes stakeholders from across the ECR ecosystem to examine the key technical, market, and policy solutions needed to achieve rapid and responsible deployment and commercialization of ECR. This brief offers five policy recommendations focused on addressing the financial and market barriers to scaling this critical-path technology.
Summary of Policy Priorities
| Category | Policy Priority | Lead |
|---|---|---|
| Early Project Financing | 1. Increase program direction budget to fund staffing in key DOE offices | L |
| 2. Adjust section 45Q tax credit for inflation | L | |
| Derisking | 3. Require that all Class VI wells have an associated long-term MRV trust | L |
| Creating Market Certainty | 4. Develop a federal procurement program with increasing tonnage requirements | L |
| 5. Create a federal economy-wide price on carbon with credits for emissions removals | L A |
The column labelled “lead” indicates whether the policy falls under legislative L and/or administrative A purview.
Conclusion
The U.S. federal government has demonstrated a commitment to meeting gigaton-scale carbon dioxide removal by mid-century. Initiatives like the CarbonSafe program, the DAC Hubs program, the CDR Purchase Pilot Prize, the section 45Q tax credit—and many others made possible through the IIJA and IRA—are foundational to enabling the evolution of engineered carbon removal through the full innovation cycle, from lab-scale ideation to commercial-scale deployment. Continuous improvement of existing programs and thoughtful additions of new initiatives will be critical to ensuring that federal policy continues to comprehensively and durably support the entire CDR industry, including engineered carbon removal. The policy recommendations offered in this brief were developed through discussions with stakeholders across the engineered carbon removal ecosystem and offer a potential path forward in the pursuit of this objective. Ensuring (1) that federal offices have sufficient personnel to effectively execute on their programs; (2) that 45Q tax credit is adjusted for inflation; (3) that all Class VI wells have an associated long-term MRV trust; (4) the establishment of a federal CDR procurement program with increasing tonnage requirements; and (5) the implementation of a federal economy-wide price on carbon inclusive of carbon removal credits will all contribute to the establishment of engineered carbon removal as an effective piece of the broader decarbonization puzzle.