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Biden-Harris Administration Announces $3.7 Billion to Kick-Start America’s Carbon Removal Industry

Biden-Harris Administration Announces $3.7 Billion to Kick-Start America’s Carbon Removal Industry

Four Bipartisan Infrastructure Law Programs Will Drive the Commercialization of Technologies Helping Remove CO2 Directly from the Atmosphere, Deliver Cleaner Air, Generate Good- Paying Jobs

The Biden-Harris Administration, through the U.S. Department of Energy (DOE), announced the launch of four programs that will help build a commercially viable, just, and responsible carbon dioxide removal industry in the United States. The programs, funded with $3.7 billion from President Biden’s Bipartisan Infrastructure Law, will help accelerate private-sector investment, spur advancements in monitoring and reporting practices for carbon management technologies, and provide grants to state and local governments to procure and use products developed from captured carbon emissions. In tandem with strong actions to lower carbon emissions, large-scale deployment of carbon management technologies is crucial to addressing the climate crisis and meeting President Biden’s goal of a net-zero greenhouse gas emissions economy by 2050, which will both protect existing industrial jobs and create new ones. 

“No matter how fast we decarbonize the nation’s economy, we must tackle the legacy pollution already in our atmosphere to avoid the worst effects of climate change,” said U.S. Secretary of Energy Jennifer M. Granholm.  “President Biden’s Bipartisan Infrastructure Law provides the transformative investments needed to scale up the commercial use of technologies that can remove or capture CO2, which will bring jobs to our regions across the country and deliver a healthier environment for all Americans.”   

The President’s historic agenda is working to lower carbon pollution across all sectors of our economy. As we continue to lower carbon emissions even further, carbon dioxide removal is a critical tool for cleaning up legacy carbon pollution that is already causing significant climate change related damage in the form of more intense storms, floods, and wildfires. 

In addition to this funding through the Bipartisan Infrastructure Law, President Biden’s Inflation Reduction Act features substantial improvements to the federal Section 45Q tax credit for the capture and geologic storage of CO2, which will provide substantial complementary incentives. DOE’s analysis estimates that actions taken through the Inflation Reduction Act and the Bipartisan Infrastructure Law will drive 2030 economy-wide greenhouse gas emissions to 40% below 2005 levels.

See related article: Biden-Harris Administration Announces $550 Million in Clean Energy Funding

DOE’s efforts will result in benefits to communities across the United States like creating quality jobs, while ensuring projects prioritize equity and environmental justice in alignment with President Biden’s Justice40 Initiative, which aims to provide 40 percent of the overall benefits of certain federal investments to disadvantaged communities. In addition to reducing greenhouse gas emissions, these technologies can reduce criteria air pollutants, protect communities from increases in cumulative pollution, and maintain and create good, union-friendly jobs across the country.

Today, DOE is announcing new efforts from the following Bipartisan Infrastructure Law:  

  • Direct Air Capture Commercial and Pre-Commercial Prize – DOE’s Office of Fossil Energy and Carbon Management (FECM) is announcing the Direct Air Capture Prize for support and prize awards totaling $115 million to promote diverse approaches to direct air capture. The Direct Air Capture Pre-Commercial Prize provides up to $15 million in prizes to incubate and accelerate research and development of breakthrough direct air capture technologies. The Direct Air Capture Commercial Prize provides up to $100 million in prizes to qualified direct air capture facilities for capturing CO2 from the atmosphere.
  • Regional Direct Air Capture Hubs – DOE’s Office of Clean Energy Demonstrations (OCED), in partnership with FECM, is announcing the Regional Direct Air Capture Hubs program. DOE will invest $3.5 billion to develop four domestic regional direct air capture hubs, each of which will demonstrate a direct air capture technology or suite of technologies at commercial scale with the potential for capturing at least 1 million metric tons of CO2 annually from the atmosphere and storing that CO2 permanently in a geologic formation or through its conversion into products. The first funding opportunity announcement under this program released today makes available more than $1.2 billion to begin the process for conceptualizing, designing, planning, constructing, and operating direct air capture hubs, with additional opportunities expected to follow in the coming years.
  • Carbon Utilization Procurement Grants – FECM will manage the Carbon Utilization Procurement Grants Program, which will provide grants to states, local governments, and public utilities to support the commercialization of technologies that reduce carbon emissions while also procuring and using commercial or industrial products developed from captured carbon emissions. The Notice of Intent released today informs stakeholders of DOE’s intent to announce the first FOA issuance, which will provide grants totaling up to $100 million.
  • Bipartisan Infrastructure Law Technology Commercialization Fund (TCF) -– DOE’s Office of Technology Transitions (OTT), in partnership with FECM, will issue a Lab Call to accelerate commercialization of carbon dioxide removal technologies, including direct air capture, by advancing measurement, reporting, and verification best practices and capabilities. OTT anticipates awarding $15 million to projects led by DOE National Laboratories, plants, and sites, and supported by diverse industry partnerships spanning the emerging carbon dioxide removal sector.

DOE’s Commitment to Carbon Capture Innovation 

The Bipartisan Infrastructure Law programs support the goals of DOE’s Carbon Negative Shot initiative, which calls for innovation in carbon dioxide removal pathways that will capture CO2 from the atmosphere and store it at gigaton scales for less than $100/net metric ton of CO2-equivalent. They also contribute to U.S. responsibilities under the Carbon Dioxide Removal Launchpad, a coalition of countries that has committed to leveraging collective resources and best practices to accelerate innovation and cost reductions across a portfolio of carbon dioxide removal technologies. The Carbon Dioxide Removal Launchpad members each agree to build at least one 1,000+ ton/year carbon dioxide removal project by 2025, contribute to cumulative investment of $100 million collectively by 2025 to support demonstration projects, and support efforts to advance robust measurement, reporting, and verification. 

Since January 2021, DOE has invested more than $250 million in 62 research and development projects and front-end engineering design studies to advance carbon management approaches that include carbon dioxide removal and carbon utilization projects.  


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