Program

Credit for Investment in Clean Coal Facilities

Category

Energy - Fossil Fuels

Subsidy Type

Tax Expenditure

Committees of Jurisdiction

Senate Finance Committee

$200 FY 16 Budget Score (in mil.)
$2,000 FY 16-25 Budget Score (in mil.)

An investment tax credit is available for power generation projects that use integrated gasification combined cycle (IGCC) or certain other coal based electricity generation technologies. IGCC and other advanced coal projects must separate and sequester at least 65 percent of the project’s total carbon emissions and gasification projects must separate and sequester at least 75 percent of total carbon dioxide emissions to be eligible for the credit. The Energy Policy Act of 2005 made $800 million available for a 20 percent tax credit for eligible IGCC projects, and provided $500 million for 15 percent tax credits for other advanced coal-based electricity generation technologies. It also allocated $350 million for a 20 percent credit for qualified gasification projects. After the credits were fully distributed, the Energy Improvement and Extension Act of 2008 allocated an additional $1.25 billion in new credits for qualifying taxpayers, who are eligible for a 30 percent credit. It also allocated $250 million in credits for qualified gasification projects, also through a 30 percent credit.

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