Carbon Capture Act

Summary: Carbon Capture Act  This bill amends the Internal Revenue Code, with respect to the tax credit for carbon dioxide sequestration, to: (1) make such credit permanent after 2015; (2) increase such credit after 2024 for a qualified facility originally placed in service after December 31, 2015; (3) allow such credit to a person who disposes of, or uses as a tertiary injectant, the carbon dioxide; and (4) modify the definition of &quot;qualified facility&quot; for purposes of eligibility for such credit to require not less than 150,000 metric tons (currently, 500,000 metric tons) to be captured at such a facility during the taxable year. 

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Carbon Capture Act''.

SEC. 2. CARBON DIOXIDE SEQUESTRATION CREDIT IMPROVED AND MADE 
              PERMANENT.

    (a) Credit Made Permanent.--Section 45Q of the Internal Revenue 
Code of 1986 is amended by striking subsection (e).
    (b) Increase in Credit for New Facilities.--
            (1) In general.--Section 45Q of such Code, as amended by 
        subsection (a), is amended by redesignating subsections (b), 
        (c), and (d) as subsections (c), (d), and (e), respectively, 
        and by inserting after subsection (a) the following new 
        subsection:
    ``(b) Credit Rates for New Qualified Facilities.--
            ``(1) In general.--In the case of a taxable year beginning 
        in a calendar year after 2024 with respect to a qualified 
        facility at which carbon capture equipment is originally placed 
        in service after December 31, 2015--
                    ``(A) subsection (a)(1) shall be applied by 
                substituting `$30' for `$20', and
                    ``(B) subsection (a)(2) shall be applied by 
                substituting `$30' for `$10'.
            ``(2) Phase-up.--In the case of a qualified facility at 
        which carbon capture equipment is originally placed in service 
        during a calendar year after 2015 and before 2025 and any 
        taxable year beginning in such calendar year--
                    ``(A) subsection (a)(1) shall be applied by 
                substituting for `$20' the dollar amount with respect 
                to each calendar year determined by ratably increasing 
                such dollar amount annually from $21.85 with respect to 
                calendar year 2015 to $30 with respect to calendar year 
                2025, and
                    ``(B) subsection (a)(2) shall be applied by 
                substituting for `$10' the dollar amount with respect 
                to each calendar year determined by ratably increasing 
                such dollar amount annually from $10.92 with respect to 
                calendar year 2015 to $30 with respect to calendar year 
                2025.
            ``(3) Inflation adjustment.--In the case of any taxable 
        year beginning in a calendar year after 2025 with respect to a 
        qualified facility at which carbon capture equipment is 
        originally placed in service after December 31, 2015, there 
        shall be substituted for each $30 amount contained in paragraph 
        (1) an amount equal to the product of--
                    ``(A) such dollar amount, multiplied by
                    ``(B) the inflation adjustment factor for such 
                calendar year determined under section 43(b)(3)(B) for 
                such calendar year, determined by substituting `2024' 
                for `1990'.''.
            (2) Conforming amendment.--Section 45Q(e)(7) of such Code, 
        as redesignated by paragraph (1), is amended by inserting 
        ``with respect to a qualified facility at which carbon capture 
        equipment is originally placed in service before January 1, 
        2016'' after ``2009''.
    (c) Election To Allow Credit to Person That Disposes of, or Uses as 
a Tertiary Injectant, Carbon Dioxide.--Section 45Q(e)(5) of such Code, 
as redesignated by subsection (b), is amended--
            (1) by striking ``Any credit'' and inserting the following:
                    ``(A) In general.--Any credit'',
            (2) by inserting ``subparagraph (B) or'' after ``except to 
        the extent provided in'', and
            (3) by adding at the end the following new subparagraph:
                    ``(B) Election to allow credit to person that 
                disposes of, or uses as tertiary injectant, carbon 
                dioxide.--If the person described in subparagraph (A) 
                makes an election under this subparagraph (as such time 
                and in such manner as the Secretary may prescribe), the 
                credit determined under this section--
                            ``(i) shall be allowable to the person that 
                        disposes of, or uses as a tertiary injectant, 
                        the carbon dioxide, and
                            ``(ii) shall not be allowable to the person 
                        described in subparagraph (A).''.
    (d) Reduction in Qualified Facility Threshold.--Section 45Q(d)(3) 
of such Code, as redesignated by subsection (b), is amended by striking 
``500,000'' and inserting ``150,000''.
    (e) Effective Dates.--
            (1) Credit made permanent.--The amendment made by 
        subsection (a) shall apply to calendar years beginning after 
        2015.
            (2) Increase in credit for new facilities.--The amendments 
        made by subsection (b) shall apply to facilities at which 
        carbon capture equipment is originally placed in service after 
        December 31, 2015.
            (3) Election to allow credit to person that disposes of, or 
        uses as a tertiary injectant, carbon dioxide.--The amendments 
        made by subsection (c) shall apply to taxable years beginning 
        after the date of the enactment of this Act.
            (4) Reduction in qualified facility threshold.--The 
        amendments made by subsection (d) shall apply to taxable years 
        beginning after the date of the enactment of this Act.