Net-Negative Carbon Dioxide Baseload Power Act
Bill: H.R.4891 | Sponsor: Rep. McKinley, David B. (R-WV)
Policy area: Energy

Summary:
Net-Negative Carbon Dioxide Baseload Power Act
This bill requires the Department of Energy (DOE) to establish a net-negative carbon dioxide baseload power development and commercialization program. Under the program, DOE must (1) facilitate the redevelopment of existing coal-fueled power plant sites with certain technologies that enable them to generate power with net-negative carbon dioxide emissions, and (2) lessen the economic impact from climate change policies on communities dependent upon coal-fueled power plants.

To require the Secretary of Energy to establish a net-negative carbon 
 dioxide baseload power development and commercialization program, and 
                          for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Net-Negative Carbon Dioxide Baseload 
Power Act''.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) Electricity, like air, food, and water, is one of 
        life's necessities.
            (2) The Department of Energy properly concluded in its 
        January 2017 report to Congress, titled ``Valuation of Energy 
        Security for the United States'', the following:
                    (A) ``Electricity is essential for supporting and 
                sustaining nearly every sector of the modern economy 
                ranging from industrial output and services to national 
                security.''.
                    (B) ``A secure, reliable electric power sector is 
                necessary for economic growth, public safety, societal 
                well-being and proper functioning of critical 
                infrastructure, national security defense, lifeline 
                networks, transportation communications, water and 
                sewer.''.
                    (C) ``Without access to reliable electricity much 
                of the economy and all electricity-enabled critical 
                infrastructure are at risk.''.
            (3) The service and reliability of the electric grid of the 
        United States depends significantly on baseload coal-fueled 
        power plants.
            (4) Communities across the Nation are dependent upon, for 
        electricity supply and their economic well-being, coal-fueled 
        power plants and a healthy coal supply chain industry.
            (5) Power plants, co-fueled by coal and biomass, that 
        incorporate carbon capture, utilization, and storage, have net-
        negative carbon dioxide emissions.
            (6) Baseload power plants, co-fueled by coal and biomass, 
        that incorporate carbon capture can provide a steady supply of 
        carbon dioxide for the manufacture of carbon-based chemicals, 
        carbon-based building materials, and other value-added products 
        which can use carbon dioxide.
            (7) The Federal Government is likely to adopt climate 
        change policies that abruptly drive reduction in greenhouse gas 
        emissions. As a result, the Federal Government should also 
        incentivize the commercialization of net-negative carbon 
        dioxide power plant technology to achieve emissions reduction 
        targets, improve the reliability of the United States 
        electricity grid, and protect coal communities from devastating 
        economic loss.
            (8) The United States should lead the world in developing 
        21st century net-negative baseload power technologies that will 
        allow developing countries to continue to use their domestic 
        energy resources, meet climate goals, and provide a steady 
        source of carbon dioxide for carbon-based products that 
        contribute to economic growth and social development.

SEC. 3. ESTABLISHMENT OF A NET-NEGATIVE CARBON DIOXIDE BASELOAD 
              DEVELOPMENT AND COMMERCIALIZATION POWER PROGRAM.

    (a) In General.--The Energy Policy Act of 2005 (42 U.S.C. 16291 et 
seq.) is amended by adding at the end of subtitle F of title IX, the 
following:

``SEC. 970. NET-NEGATIVE CARBON DIOXIDE BASELOAD POWER DEVELOPMENT AND 
              COMMERCIALIZATION PROGRAM.

    ``(a) Definitions.--
            ``(1) Construction phase.--The term `construction phase' 
        means, with respect to an eligible project, the period between 
        a project's final investment decision and commencement of 
        commercial operations.
            ``(2) Eligible project.--The term `eligible project' means 
        a project to design, develop, construct, and operate a 
        combustion- or gasification-based baseload electricity 
        generating project, which meets the criteria published under 
        subsection (c) and, when operating, has net-negative carbon 
        dioxide emissions.
            ``(3) Final investment decision.--The term `final 
        investment decision' means, with respect to an eligible 
        project, the time in the project planning process when the 
        decision to make major financial commitments is taken.
            ``(4) Fuel supply chain.--The term `fuel supply chain' 
        means, with respect to an eligible project, the principal 
        industrial activities associated with the production, 
        processing, storage, and transportation of fuel to the eligible 
        project.
            ``(5) Net-negative carbon dioxide emissions.--The term 
        `net-negative carbon dioxide emissions' means that the annual 
        amount of carbon dioxide emitted by an eligible project, 
        including the project's fuel supply chain, conversion of fuel 
        to electricity and co-products, carbon capture and storage, and 
        other directly associated onsite activities, less the amount of 
        carbon dioxide permanently stored by the project including the 
        project's fuel supply chain, conversion of fuel to electricity 
        and co-products, carbon capture and storage, and other directly 
        associated onsite activities, is a negative amount.
            ``(6) Non-routine event.--The term `non-routine event' 
        means, with respect to a coal-fueled power plant, an event, 
        typically not planned, that interrupts routine operation, 
        including equipment failure, fuel supply chain disruption, and 
        pipeline interruption.
            ``(7) Operations phase.--The term `operations phase' means, 
        with respect to an eligible project, the period between 
        commencement of commercial operations and permanent cessation 
        of commercial operations.
            ``(8) Project concept study phase.--The term `project 
        concept study phase' means, with respect to an eligible 
        project, a study conducted prior to the project development 
        phase, to develop--
                    ``(A) the basic project concept;
                    ``(B) high-level project economics;
                    ``(C) a description of the technology or 
                technologies that will be used for the eligible 
                project;
                    ``(D) a compilation of the required permits and 
                plan for securing them;
                    ``(E) project partners; and
                    ``(F) project plans, including schedules.
            ``(9) Project development phase.--The term `project 
        development phase' means, with respect to an eligible project, 
        the period between completion of the project concept study and 
        the final investment decision. The project development phase 
        includes, with respect to an eligible project--
                    ``(A) engineering design work;
                    ``(B) legal work;
                    ``(C) supplemental surface and subsurface rights 
                acquisition;
                    ``(D) site-specific geologic characterization work;
                    ``(E) permitting;
                    ``(F) stakeholder engagement; and
                    ``(G) other activities necessary to support a 
                successful final investment decision on the eligible 
                project.
            ``(10) Routine operation.--The term `routine operation' 
        means, with respect to a coal-fueled power plant, typically 
        expected operation of such coal-fueled power plant, including 
        start-ups, regular operations, planned shutdowns, and 
        maintenance.
    ``(b) Establishment.--
            ``(1) In general.--The Secretary shall establish a net-
        negative carbon dioxide baseload power development and 
        commercialization program to--
                    ``(A) facilitate the redevelopment of existing 
                coal-fueled power plant sites with technology that 
                enables baseload coal- and biomass-fueled power 
                generation that has net-negative carbon dioxide 
                emissions; and
                    ``(B) lessen the negative economic impact from 
                climate change policies on communities dependent upon 
                coal-fueled power plants.
            ``(2) Eligible projects.--In carrying out the program 
        established under paragraph (1), the Secretary shall establish 
        a competitive, merit-reviewed process, with multiple closing 
        dates for applications that are not more than quarterly and not 
        less than semiannually, to provide financial assistance to 
        projects that will redevelop existing coal-fueled power plant 
        sites to supply net-negative baseload power.
    ``(c) Criteria.--The Secretary shall publish criteria in the 
Federal Register for eligible projects, including that--
            ``(1) eligible projects shall--
                    ``(A) involve redevelopment of existing coal-fueled 
                power plants at the same general site;
                    ``(B) incorporate carbon capture, utilization, and 
                storage technology;
                    ``(C) provide baseload power generation;
                    ``(D) use at least 70 percent coal, based on energy 
                content, as fuel during the operations phase; and
                    ``(E) include meaningful participation by the owner 
                of the existing coal-fueled power plant asset to be 
                redeveloped at the initiation of the concept study 
                phase;
            ``(2) eligible projects may--
                    ``(A) on an annual basis, use up to 30 percent 
                biomass or other non-coal fuels combined, based on 
                energy content;
                    ``(B) buy verifiable carbon dioxide offsets to 
                offset carbon dioxide emissions from non-routine 
                events;
                    ``(C) permanently store carbon dioxide onsite or 
                offsite;
                    ``(D) transport captured carbon dioxide via an 
                onsite or offsite dedicate pipeline, or shared 
                pipeline, to permanent storage;
                    ``(E) co-produce carbon-free fuel, including 
                hydrogen or ammonia, that is used as fuel onsite or 
                offsite; and
                    ``(F) incorporate direct air capture technology, 
                provided that the captured carbon dioxide is combined 
                with the primary stream of carbon dioxide captured at 
                the plant; and
            ``(3) eligible projects may not buy carbon dioxide offsets 
        for carbon dioxide emissions from routine operations, other 
        than offsets directly gained through the project's fuel supply 
        chain.
    ``(d) Program Implementation.--In implementing the program 
established under subsection (b), the Secretary shall--
            ``(1) make grants for project concept studies;
            ``(2) provide an opportunity for persons who have 
        successfully completed a project concept study using a grant 
        provided pursuant to paragraph (1) to enter into cooperative 
        agreements for continuing Federal financial assistance for the 
        subsequent phases of an eligible project;
            ``(3) structure the program to allow grant recipients for 
        eligible projects to move without time lags between the project 
        concept study phase and project development phase;
            ``(4) recognize eligible projects as projects meeting the 
        requirements of section 1703(a)(1);
            ``(5) during the project development phase, based on 
        satisfactory progress towards a final investment decision and 
        financial need, make one or more conditional commitments to one 
        or more incentives that will increase the likelihood of 
        commercial financing, construction, and successful operation of 
        the eligible project, including--
                    ``(A) construction cost-sharing, including 
                acquisition of additional surface and subsurface 
                rights;
                    ``(B) start-up cost-sharing;
                    ``(C) a financially backed completion guarantee;
                    ``(D) a financially backed performance guarantee;
                    ``(E) financially backed operating contracts for 
                differences;
                    ``(F) a loan guarantee;
                    ``(G) indemnification for third-party claims 
                against the eligible project and its asset owners, 
                which are associated with a carbon dioxide storage site 
                that has been certified as safely closed by the State 
                with jurisdiction over the associated injection wells, 
                as long as Federal indemnification does not substitute 
                for indemnification or insurance programs reasonably 
                available from third-party insurers; and
                    ``(H) financial reserves or fees to support 
                eligible projects acquiring insurance;
            ``(6) ensure close coordination and substantial information 
        sharing between the offices of the Department that are 
        administering such program and title XVII of this Act;
            ``(7) assess the economics, performance, and risks 
        associated with each eligible project to provide reasonable 
        assurances that the sum of incentives provided by the 
        Department--
                    ``(A) are adequate to give eligible projects an 
                opportunity to attract commercial financing; and
                    ``(B) do not over incentivize the eligible project;
            ``(8) establish one or more trust funds to hold the Federal 
        funds associated with the program; and
            ``(9) deposit amounts made available to carry out the 
        program into the trust funds established pursuant to paragraph 
        (8) into the program trust within 90 days of receipt.
    ``(e) Expenditures.--Amounts in the trust funds established 
pursuant to subsection (d)(8) shall be available, without further 
appropriation, to carry out the program established under subsection 
(b).
    ``(f) Cost-Sharing.--
            ``(1) Project concept studies.--The Secretary may provide 
        grants of up to $5,000,000 for project concept studies per 
        eligible project.
            ``(2) Cost sharing for project development phase.--The 
        Secretary shall require successful applicants of eligible 
        projects to provide 10 percent non-Federal cost-share for costs 
        incurred for activities during the project development phase.
            ``(3) Cost sharing for construction phase.--The Secretary 
        shall determine the non-Federal cost-sharing for the 
        construction phase of each eligible project based on project 
        need, and the amount of Federal construction-related incentives 
        provided, under this program and any construction-related 
        Department loan guarantees, shall not exceed the amount 
        specified in section 1702(c).
            ``(4) Loan guarantee program fees.--Fees paid pursuant to 
        section 1702(h) are considered an allowable expense of funds 
        made available for the program established under subsection 
        (b).
            ``(5) Tax credits.--Federal tax credits shall not count 
        against the maximum non-Federal cost-sharing provisions of this 
        section.
    ``(g) Authorization of Appropriations.--There is authorized to be 
appropriated to the Secretary for grants for project concept studies, 
and for administrative expenses for the program established under 
subsection (b), $300,000,000 to remain available until expended.''.
    (b) Table of Contents.--The table of contents for the Energy Policy 
Act of 2005 is amended by adding after the item relating to section 
969D the following:

``Sec. 970. Net-negative carbon dioxide baseload power development and 
                            commercialization program.''.
                                 <all>