Dear Congress: It’s Time to End the Carbon Capture Grift—And All Energy Subsidies With It
By Wayne Christian, Texas Railroad Commissioner
As Congress works on President Donald Trump’s “Big, Beautiful Bill”, conservative lawmakers have an opportunity—and responsibility—to eliminate the 45Q tax credit for carbon capture and sequestration (CCS). This tax credit isn’t about climate responsibility or innovation. It’s about corporate welfare. It’s another example of Washington handing taxpayer dollars to powerful companies under the guise of environmental progress, while distorting markets and propping up technologies that can’t stand on their own.
The U.S. oil and gas industry has long taken pride in its independence and innovation. But in recent years, some of the largest players have begun mimicking the subsidy-seeking behavior of the green energy sector, seeking taxpayer handouts to support technologies like CCS that cannot compete without government support.
We’ve seen how this story ends. In Texas, the Petra Nova CCS facility launched in 2017 amid much fanfare. Three years later, it shut down—economically unsustainable once its subsidies dried up. It reopened only after the Biden administration showered the industry with new CCS funding through the Infrastructure Investment and Jobs Act and the Inflation Reduction Act.
Now, companies like major international oil companies are lining up for billions in new federal subsidies. One CCS project with Calpine could net $270 million in taxpayer support. Another is receiving $500 million for one CCS facility in South Texas and is advancing a new $1 billion project in West Texas that’s being branded as the world’s largest carbon capture facility. These projects would not be viable without federal support.
If a technology requires permanent subsidies to function, it is not a market-ready solution. That’s not innovation—that’s dependence. And it’s antithetical to the kind of capitalism that built America’s energy sector.
Supporters of CCS argue that these subsidies are essential to reduce carbon emissions. But the facts tell a different story. U.S. CO₂ emissions have already declined by 20% over the past two decades. Furthermore, our oil production is 23% cleaner than the global average. Meanwhile, China continues to emit with impunity. Even President Biden has admitted that unilateral U.S. climate efforts won’t change the global outcome.
So why are some American energy companies now embracing policies that, not long ago, they would have rejected as government overreach? Because Washington spending is easy money, and shareholder pressure for ESG box-checking is intense. But short-term gains today will bring long-term costs tomorrow—more regulation, more federal leverage over private industry, and more distortion of energy markets. Ultimately, these higher costs just get passed on to the consumer.
This should concern anyone who believes in free enterprise. If carbon credits and CCS subsidies become entrenched policy, the result will be a bifurcated industry where only large corporations can afford to participate. Small, independent producers—who can’t build billion-dollar CCS infrastructure—may be forced to purchase carbon offsets just to stay in business. Some will simply fold. And with them will go jobs, competition, and billions in tax revenue that support states like Texas.
CCS subsidies are also at odds with efforts by the Trump administration and current conservatives to dismantle the Net Zero regulatory framework. I applaud EPA Administrator Lee Zeldin for his recent pledge to rollback President Biden’s CO₂ requirements for coal and gas power plants and his agency’s reconsideration of the 2009 “endangerment finding,” which gave regulatory teeth to the idea that CO₂ is a pollutant. That designation fueled the current regulatory and subsidy apparatus. Moreover, the European Union recently mandated oil and gas companies to store CO₂, and American oil and gas companies could be next if there’s another Democrat in the White House.
With a $37 trillion debt, Congress is right to cut as much federal spending as possible—starting with 45Q and all the money in Biden’s Inflation Reduction Act. According to the U.S. Treasury Department, 45Q tax credits will cost taxpayers $25 billion over the next decade, which is more than all the oil and gas production tax subsides combined. If Congress is serious about reeling in government spending and reversing the tide of government overreach, it starts with ending the flow of taxpayer dollars to unviable technologies.
Markets—not mandates—should determine the future of energy. If American companies want to lead, they should do so by innovating, not lobbying. If a technology is sound, it will succeed without subsidies. If it isn’t, no amount of government support will make it work.
The future of energy should be built on competition, not compliance. Congress should end the 45Q tax credit—and with it, the illusion that carbon capture is anything more than a federally funded mirage.
