45Q Carbon Oxide Conversion LCA Training Workshop

In partnership with the United States Energy Association, the U.S. Department of Energy's (DOE) Office of Fossil Energy and Carbon Management and the National Energy Technology Laboratory (NETL) are hosting a hybrid training workshop to inform stakeholders and lifecycle analysis (LCA) professionals of the tools and resources available from NETL to support the development of an LCA that is compliant with the 45Q requirements.

The utilization of qualified carbon oxide for Section 45Q tax credit (26 CFR 1.45Q-4(b)) requires an LCA be completed to determine the amount of qualified carbon oxides that were either “captured and permanently isolated from the atmosphere” or “displaced from being emitted into the atmosphere” through use of an eligible utilization process.

The NETL 45Q LCA Guidance Toolkit is being updated to include additional resources (guidance, data, and examples) to assist applicants in developing LCAs that satisfy the criteria for the tax credit, facilitate timely technical reviews, and improve transparency. DOE has been working in close coordination with the IRS to continuously improve these resources based on questions from stakeholders and trends in LCAs reviewed to date.

The workshop will also discuss the extended Utilization and Procurement Grant (UPGrants) program, which is looking to support projects that have the potential to take advantage of the 45Q tax credit for utilization. DOE recognizes the need to build LCA capability in this space to help accelerate the development and adoption of utilization technologies, especially for emerging technologies. To facilitate this, DOE is bolstering resources and encouraging applicants to make use of the LCA review process established in support of the UPGrants program. Note, the review of an LCA prepared for the UPGrants program will not constitute any sort of pre-approval, certification, or guarantee for the 45Q tax credit.

The Section 45Q tax credit is administered by the IRS. As described in 26 CFR 1.45Q-4(c)(6), DOE assists the IRS in this regard by providing technical reviews of LCAs submitted by applicants wishing to claim the tax credit. Given that 45Q is subject to potential rulemaking to account for changes promulgated through the Inflation Reduction Act, we will be unable to address policy questions during this session.

For more information about the 45Q Carbon Oxide Conversion LCA Training Workshop visit: https://usea.org/event/doenetl-45q-carbon-oxide-conversion-lca-training-workshop-hybrid