This Act may be cited as the “Carbon Capture, Utilization, and Storage Innovation Act” or the “CCUS Innovation Act”.

(a) Categories.—Section 1703(b)(5) of the Energy Policy Act of 2005 (42 U.S.C. 16513(b)(5)) is amended by striking “Carbon capture and sequestration” and inserting “Carbon capture, utilization, and storage”.

(b) Included projects.—Section 1703 of the Energy Policy Act of 2005 (42 U.S.C. 16513) is amended by adding at the end the following:

“(f) Carbon capture, utilization, and storage projects.—The category of projects described in subsection (b)(5) includes projects involving practices or technologies relating to—

“(1) development of infrastructure to enable carbon capture, utilization, or storage, including pipelines;

“(2) direct air capture;

“(3) pre-combustion capture, and post-combustion capture, of carbon dioxide for fossil fuel based systems, such as power plants and industrial processes that utilize fossil energy;

“(4) carbon dioxide storage in geologic formations;

“(5) carbon storage efficiency and security through the use of new and early-stage monitoring tools and models;

“(6) the conversion of carbon dioxide into substances or products with higher economic value;

“(7) the conversion of carbon dioxide into biomass;

“(8) the synthesis of fuels and organic chemicals; and

“(9) the synthesis of inorganic materials and chemicals.”.

(c) Report.—Not later than 1 year after the date of enactment of this Act, the Secretary of Energy shall submit to the Committee on Energy and Commerce of the House of Representatives a report describing—

(1) with respect to projects described in subsection (f) of section 1703 of the Energy Policy Act of 2005 (as added by this section)—

(A) the status of each such project for which a guarantee has been awarded under such section 1703; and

(B) any recommendations relating to implementation of title XVII of such Act with respect to such projects;

(2) opportunities to expand the use of carbon capture, utilization, and storage for reducing industrial sector emissions;

(3) statutory and regulatory barriers to the deployment and commercialization of carbon capture, utilization, and storage technologies; and

(4) any recommendations to advance carbon capture, utilization, and storage technologies.

Section 103 of the Clean Air Act (42 U.S.C. 7403) is amended—

Not later than 1 year after the date of enactment of this Act, the Administrator of the Environmental Protection Agency (referred to in this Act as the “Administrator”) shall submit to Congress a report describing how funds appropriated to the Administrator during the 5 most recent fiscal years have been used to carry out section 103 of the Clean Air Act (42 U.S.C. 7403), including a description of—

Section 41001(6) of the FAST Act (42 U.S.C. 4370m(6)) is amended—

(a) Definitions.—In this section:

(1) CARBON CAPTURE, UTILIZATION, AND SEQUESTRATION PROJECTS.—The term “carbon capture, utilization, and sequestration projects” includes projects for direct air capture (as defined in paragraph (6)(B)(i) of section 103(g) of the Clean Air Act (42 U.S.C. 7403(g))).

(2) EFFICIENT, ORDERLY, AND RESPONSIBLE.—The term “efficient, orderly, and responsible” means, with respect to development or the permitting process for carbon capture, utilization, and sequestration projects and carbon dioxide pipelines, a process that is completed in an expeditious manner while maintaining environmental, health, and safety protections.

(b) Report.—

(1) IN GENERAL.—Not later than 180 days after the date of enactment of this Act, the Chair of the Council on Environmental Quality (referred to in this Act as the “Chair”), in consultation with the Administrator of the Environmental Protection Agency, the Secretary of Energy, the Secretary of the Interior, the Executive Director of the Federal Permitting Improvement Council, and the head of any other relevant Federal agency (as determined by the President), shall prepare a report that—

(A) compiles all existing relevant Federal permitting and review information and resources for project applicants, agencies, and other stakeholders interested in the deployment of carbon capture, utilization, and sequestration projects and carbon dioxide pipelines, including—

(i) the appropriate points of interaction with Federal agencies;

(ii) clarification of the permitting responsibilities and authorities among Federal agencies; and

(iii) best practices and templates for permitting;

(B) inventories current or emerging activities that transform captured carbon dioxide into a product of commercial value, or as an input to products of commercial value;

(C) inventories existing initiatives and recent publications that analyze or identify priority carbon dioxide pipelines needed to enable efficient, orderly, and responsible development of carbon capture, utilization, and sequestration projects at increased scale;

(D) identifies gaps in the current Federal regulatory framework for the deployment of carbon capture, utilization, and sequestration projects and carbon dioxide pipelines; and

(E) identifies Federal financing mechanisms available to project developers.

(2) SUBMISSION; PUBLICATION.—The Chair shall—

(A) submit the report under paragraph (1) to the Committee on Environment and Public Works of the Senate and the Committee on Energy and Commerce of the House of Representatives; and

(B) as soon as practicable, make the report publicly available.

(c) Guidance.—

(1) IN GENERAL.—After submission of the report under subsection (b)(2), but not later than 1 year after the date of enactment of this Act, the Chair shall submit guidance consistent with that report to all relevant Federal agencies that—

(A) facilitates reviews associated with the deployment of carbon capture, utilization, and sequestration projects and carbon dioxide pipelines; and

(B) supports the efficient, orderly, and responsible development of carbon capture, utilization, and sequestration projects and carbon dioxide pipelines.

(2) REQUIREMENTS.—

(A) IN GENERAL.—The guidance under paragraph (1) shall address requirements under—

(i) the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.);

(ii) the Federal Water Pollution Control Act (33 U.S.C. 1251 et seq.);

(iii) the Clean Air Act (42 U.S.C. 7401 et seq.);

(iv) the Safe Drinking Water Act (42 U.S.C. 300f et seq.);

(v) the Endangered Species Act of 1973 (16 U.S.C. 1531 et seq.);

(vi) division A of subtitle III of title 54, United States Code (formerly known as the “National Historic Preservation Act”);

(vii) the Migratory Bird Treaty Act (16 U.S.C. 703 et seq.);

(viii) the Act of June 8, 1940 (16 U.S.C. 668 et seq.) (commonly known as the “Bald and Golden Eagle Protection Act”); and

(ix) any other Federal law that the Chair determines to be appropriate.

(B) ENVIRONMENTAL REVIEWS.—The guidance under paragraph (1) shall include direction to States and other interested parties for the development of programmatic environmental reviews under the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) for carbon capture, utilization, and sequestration projects and carbon dioxide pipelines.

(C) PUBLIC INVOLVEMENT.—The guidance under paragraph (1) shall be subject to the public notice, comment, and solicitation of information procedures under section 1506.6 of title 40, Code of Federal Regulations (or a successor regulation).

(3) SUBMISSION; PUBLICATION.—The Chair shall—

(A) submit the guidance under paragraph (1) to the Committee on Environment and Public Works of the Senate and the Committee on Energy and Commerce of the House of Representatives; and

(B) as soon as practicable, make the guidance publicly available.

(4) EVALUATION.—The Chair shall—

(A) periodically evaluate the reports of the task forces under subsection (d)(5) and, as necessary, revise the guidance under paragraph (1); and

(B) each year, submit to the Committee on Environment and Public Works of the Senate, the Committee on Energy and Commerce of the House of Representatives, and relevant Federal agencies a report that describes any recommendations for legislation, rules, revisions to rules, or other policies that would address the issues identified by the task forces under subsection (d)(5).

(d) Task force.—

(1) ESTABLISHMENT.—Not later than 18 months after the date of enactment of this Act, the Chair shall establish not less than 2 task forces, which shall each cover a different geographical area with differing demographic, land use, or geological issues—

(A) to identify permitting and other challenges and successes that permitting authorities and project developers and operators face; and

(B) to improve the performance of the permitting process and regional coordination for the purpose of promoting the efficient, orderly, and responsible development of carbon capture, utilization, and sequestration projects and carbon dioxide pipelines.

(2) MEMBERS AND SELECTION.—

(A) IN GENERAL.—The Chair shall—

(i) develop criteria for the selection of members to each task force; and

(ii) select members for each task force in accordance with clause (i) and subparagraph (B).

(B) MEMBERS.—Each task force—

(i) shall include not less than 1 representative of each of—

(I) the Environmental Protection Agency;

(II) the Department of Energy;

(III) the Department of the Interior;

(IV) any other Federal agency the Chair determines to be appropriate;

(V) any State that requests participation in the geographical area covered by the task force;

(VI) developers or operators of carbon capture, utilization, and sequestration projects or carbon dioxide pipelines; and

(VII) nongovernmental membership organizations, the primary mission of which concerns protection of the environment; and

(ii) at the request of a Tribal or local government, may include a representative of—

(I) not less than 1 local government in the geographical area covered by the task force; and

(II) not less than 1 Tribal government in the geographical area covered by the task force.

(3) MEETINGS.—

(A) IN GENERAL.—Each task force shall meet not less than twice each year.

(B) JOINT MEETING.—To the maximum extent practicable, the task forces shall meet collectively not less than once each year.

(4) DUTIES.—Each task force shall—

(A) inventory existing or potential Federal and State approaches to facilitate reviews associated with the deployment of carbon capture, utilization, and sequestration projects and carbon dioxide pipelines, including best practices that—

(i) avoid duplicative reviews;

(ii) engage stakeholders early in the permitting process; and

(iii) make the permitting process efficient, orderly, and responsible;

(B) develop common models for State-level carbon dioxide pipeline regulation and oversight guidelines that can be shared with States in the geographical area covered by the task force;

(C) provide technical assistance to States in the geographical area covered by the task force in implementing regulatory requirements and any models developed under subparagraph (B);

(D) inventory current or emerging activities that transform captured carbon dioxide into a product of commercial value, or as an input to products of commercial value;

(E) identify any priority carbon dioxide pipelines needed to enable efficient, orderly, and responsible development of carbon capture, utilization, and sequestration projects at increased scale;

(F) identify gaps in the current Federal and State regulatory framework and in existing data for the deployment of carbon capture, utilization, and sequestration projects and carbon dioxide pipelines;

(G) identify Federal and State financing mechanisms available to project developers; and

(H) develop recommendations for relevant Federal agencies on how to develop and research technologies that—

(i) can capture carbon dioxide; and

(ii) would be able to be deployed within the region covered by the task force, including any projects that have received technical or financial assistance for research under paragraph (6) of section 103(g) of the Clean Air Act (42 U.S.C. 7403(g)).

(5) REPORT.—Each year, each task force shall prepare and submit to the Chair and to the other task forces a report that includes—

(A) any recommendations for improvements in efficient, orderly, and responsible issuance or administration of Federal permits and other Federal authorizations required under a law described in subsection (c)(2)(A); and

(B) any other nationally relevant information that the task force has collected in carrying out the duties under paragraph (4).

(6) EVALUATION.—Not later than 5 years after the date of enactment of this Act, the Chair shall—

(A) reevaluate the need for the task forces; and

(B) submit to Congress a recommendation as to whether the task forces should continue.

(a) In general.—Subparagraph (E) of section 7704(d)(1) of the Internal Revenue Code of 1986 is amended—

(1) by striking “income and gains derived from the exploration” and inserting “income and gains derived from the following:

“(i) MINERALS, NATURAL RESOURCES, ETC.—The exploration”;

(2) by inserting “or” before “industrial source”;

(3) by inserting a period after “carbon dioxide”;

(4) by striking “or the transportation or storage” and inserting the following:

“(ii) CERTAIN FUELS.—The transportation or storage”;

(5) by striking the comma at the end and inserting a period; and

(6) by adding at the end the following new clauses:

“(iii) GASIFICATION WITH SEQUESTRATION.—The production of any product or the generation of electric power from a project—

“(I) which meets the requirements of subparagraphs (A) and (B) of section 48B(c)(1), and

“(II) not less than 75 percent of the total carbon oxide emissions of which is qualified carbon oxide (as defined in section 45Q(c)) which is disposed of or utilized as provided in paragraph (6).

“(iv) CARBON CAPTURE AND SEQUESTRATION.—

“(I) POWER GENERATION FACILITIES.—The generation or storage of electric power (including associated income from the sale or marketing of energy, capacity, resource adequacy, and ancillary services) produced from any power generation facility which is, or from any power generation unit within, a qualified facility which is described in section 45Q(d) and not less than 50 percent (30 percent in the case of a facility or unit placed in service before January 1, 2019) of the total carbon oxide emissions of which is qualified carbon oxide which is disposed of or utilized as provided in paragraph (6).

“(II) OTHER FACILITIES.—The sale of any good or service from any facility (other than a power generation facility) which is a qualified facility described in section 45Q(d) and the captured qualified carbon oxide (as so defined) of which is disposed of as provided in paragraph (6).”.

(b) Disposal and utilization of captured carbon oxide.—Section 7704(d) of such Code is amended by adding at the end the following new paragraph:

“(6) DISPOSAL AND UTILIZATION OF CAPTURED CARBON OXIDE.—For purposes of clauses (iii) and (iv) of paragraph (1)(E), carbon oxide is disposed of or utilized as provided in this paragraph if such carbon oxide is—

“(A) placed into secure geological storage (as determined under section 45Q(f)(2)),

“(B) used as a tertiary injectant (as defined in section 45Q(e)(3)) in a qualified enhanced oil or natural gas recovery project (as defined in section 45Q(e)(2)) and placed into secure geological storage (as so determined), or

“(C) utilized in a manner described in section 45Q(f)(5).”.

(c) Effective date.—The amendments made by this section shall take effect on the date of the enactment of this Act, in taxable years ending after such date.