The Client: Carbon Engineering is a pioneering carbon removal company that focuses on deployment of Direct Air Capture (DAC) technology capable of capturing carbon dioxide directly from the atmosphere. Enabled largely through working with governments and businesses that develop carbon reduction pledges, Carbon Engineering is working alongside its strategic development partners to deploy large-scale DAC facilities around the world and play a key role in supporting the global transition to net zero. The first commercial DAC plant to utilize the company’s technology is being developed in the US in partnership with 1PointFive, and is expected to capture one million tons of CO2 each year when complete, which is roughly equivalent to the carbon removal work of ~40 million trees or taking ~250,000 cars off the road.
The Problem: Like many climate related technologies and industries, clear and positive policy developments that align with net zero targets are fundamental to advance key activity and plant deployment, and create a viable market for carbon removal. While renewable energy technologies such as solar photovoltaics and wind receive significant public attention and incentives, other climate solution opportunities, such as DAC, are at risk of being overlooked in the legislative arena. Additionally, carbon removal technologies face a unique challenge – absent a carbon price or equivalent, there is no revenue source for removing carbon dioxide from the atmosphere, forcing early actors in the space to turn to regulated markets (such as the California Low Carbon Fuel Standard (LCFS) or federal 45Q tax credit) or emerging voluntary markets for revenue. Given the early stage and costs of carrying out DAC at scale, Carbon Engineering requires adept advocacy to help navigate the political landscape and achieve results that would support widespread deployment.
The Solution: For multiple years, Waxman Strategies has been working alongside Carbon Engineering to educate policymakers on the importance of DAC and to ensure that it plays an effective role in accelerating America’s transition to a prosperous net-zero economy. We have spent this time developing relationships, champions, and coalitions, comprised of a bipartisan group of supporters, to ensure that lawmakers understand and implement what is needed to harness the value of this growing and critical climate technology including investments in Research, Development and Deployment (RD&D) at the Department of Energy (DOE), tax credits, and annual appropriations.
- Participated in efforts to enhance the 45Q tax credit for Direct Air Capture through enhanced values, a commence construction deadline extension, and direct pay eligibility
- Led a bipartisan effort to authorize alternative financing mechanisms such as private activity bonds and master-limited partnerships
- Worked with Congress to authorize and appropriate significant RD&D funds at DOE, including a commercial DAC prize program
- Explored incentives for other applications of DAC technology such as sustainable aviation fuel production