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ExxonMobil would like to see the tax credit for carbon capture and storage increased to $100 per ton from the current $50 per ton, as a means to incentivize carbon capture and storage (CCS) projects, the supermajor’s chief executive Darren Woods told CNBC’s David Faber in an interview this week.
Exxon’s top executive believes that direct air capture of carbon dioxide from the atmosphere could be “the holy grail” in clean energy technology.
“If you can overcome some of those technology hurdles, get your cost down, you’ve got a technology then that can address this in a very cost-efficient way,” Woods told CNBC.
ExxonMobil says that CCS is “one of the few proven technologies with the potential to significantly reduce emissions from certain hard-to-decarbonize sectors, such as manufacturing and heavy industry.”
The U.S. oil and gas major, however, says that new policies are necessary to spur the investment required to deploy CCS at such a pace and scale. Those policies suggested by Exxon include a rise in the value of carbon to around $100 per metric ton from the current $50, extending the eligibility period to 30 years from current 12 years, and eliminating the deadline for starting construction of a CCS project. Exxon also says that the U.S. Department of Energy programs could provide financial support for CCS infrastructure.
Exxon pledged last year to invest more than $15 billion through 2027 on initiatives to lower greenhouse gas emissions. The initiatives include investments to reduce emissions from company operations and to advance technologies like carbon capture and storage, hydrogen, and biofuels, which together are expected to develop into multi-trillion-dollar markets in the coming decades.
“Long-term, we have the portfolio flexibility necessary to pace our investments consistent with advancements in technology, markets and supportive policy,” Woods said at Exxon’s shareholders’ meeting last month.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.