Forty years after boosters began promoting carbon capture and storage (CCS), the technology remains a failure. Yet lawmakers have dedicated more public funds to this scam than ever. They are ignoring carbon capture’s history of waste and fraud — and all the ways that polluters can and do exploit incentives. 

CCS technology promises to capture carbon dioxide (CO₂) from smokestacks or the air and permanently keep it out of the atmosphere. It enables a fantasy where dirty energy can be made clean with the right technology; where we can fight climate change while continuing to drill and burn fossil fuels.

While federal support for renewables plummets under Donald Trump, our leaders are expanding 45Q, a lucrative tax incentive program for the CCS climate scam. Worse, 45Q just got a major bump from Trump’s Big Ugly Bill to incentivize more oil drilling.

Lawmakers are making more funds available to polluters, while failing to guard these funds from exploitation. As our new research shows, this amounts to throwing our taxpayer dollars down oil and gas wells and into fossil fuel execs’ pockets.

Billions of Dollars Spent on CCS With Nothing to Show for It

The federal government has already spent decades and billions of dollars on the carbon capture pipe dream. It began with federal “clean coal” efforts, which aimed to use the technology to reduce coal’s climate harm. From 1984 to 2006, the federal government spent $7 billion developing this technology with nothing to show for it. 

The Energy Department was also dumping cash into another fossil fuel technology branded as carbon capture: enhanced oil recovery (EOR), a drilling technique using captured carbon. With EOR, drillers inject CO₂ into oil wells to bring the last dregs of oil to the surface. 

Like the debunked “bridge fuel” messaging around natural gas, proponents claimed EOR would help develop carbon capture into a real climate solution, without oil production.

This has not come to pass. In fact, almost 90% of CO₂ captured in the U.S. is still used for EOR. And this does more harm to the climate than help. In fact, burning the oil produced through EOR emits more CO₂ than is injected during the process.

Carbon capture then got another $3.4 billion boost with the 2009 American Recovery and Reinvestment Act. The result? Cost overruns and canceled projects, which have only continued to plague the industry since. 

With billions of dollars and forty years of tinkering, carbon capture’s climate impact is laughable. As of September 2023, total U.S. CCS capacity — if run at maximum capacity — could capture only 0.4% of all our emissions. Piling more subsidies onto carbon capture is a waste, especially given the rapidly shrinking timeline we have to downsize emissions and avert climate chaos.

Lack of Oversight Allows Fraud and Abuse to Run Rampant in 45Q

Not only have carbon capture subsidies failed to scale the technology — they’ve also been mismanaged, allowing exploitation to run rampant. The Government Accountability Office reported that the Energy Department’s handling of carbon capture, all the way back to the George W. Bush administration, was riddled with accounting errors. The Department also continued to fund projects that missed targets and violated agreements.

Today, the 45Q program is hidden behind a smokescreen. We don’t even know what specific facilities claim the credit or the maximum funds the federal government will distribute through the program. 

Moreover, no single government agency has full access to the data used to implement 45Q. This reduces oversight. Both the Environmental Protection Agency (EPA) and Internal Revenue Service (IRS), which administer different parts of 45Q, operate with incomplete knowledge of the projects that recieve the credit. 

Furthermore, there’s not enough accountability in how companies report the CO₂ they “capture.” To “verify” companies’ captured CO₂, the IRS depends on numbers that the companies themselves report to the EPA, without checks from either agency.

All this contributes to the fraud and waste that runs rampant in 45Q. In 2020, the Treasury Department found that companies had improperly claimed nearly $1 billion in 45Q credits. These companies failed to give proof that the CO₂ was effectively stored. 

How did lawmakers respond? By boosting 45Q tax credits through the Inflation Reduction Act.

And now, Trump has further expanded the pie for fossil fuel corporations to get 45Q dollars. His administration is also gutting oversight and clearing the way for more abuse. It has fired government watchdogs for federal agencies and is slashing staff at the EPA and IRS. 

45Q Lavishes Big Bucks on Fossil Fuel Facilities With Dubious Climate Benefit

The biggest scandal of 45Q? Many of the dollars for a so-called “climate solution” are awarded to polluters for polluting the same as they always have. Oil drillers and gas processors have used 45Q to claim tax benefits without changing anything about their existing operations. 

Crucially, Trump’s Big Ugly Bill provided a huge boost to the 45Q tax credit for enhanced oil recovery, the main use of captured CO₂. This has unlocked a potential $210 billion in additional subsidies, just for oil drillers to continue drilling.

The program also rewards natural gas processing facilities for disposing of their waste in the same way they always have. Drilling for methane gas brings up waste that includes CO₂; processors have long separated out that CO₂ and then injected it underground. By simply reclassifying these injection wells, gas processors can access 45Q dollars. We estimate that now 60% of the reported CO₂ captured in the U.S. comes from gas processing facilities. 

To make matters worse, CO₂ needs to stay underground for thousands of years to benefit the climate, but long-term storage is far from guaranteed. Storage technology is riddled with issues that lead to leaks. 

45Q rules require companies to give back credits for leaked CO₂ — but this only lasts for four years. Anything that leaks after that? Companies get to keep the money. This gives them no incentive to ensure CO₂ stays in the ground long enough to actually help the climate.

We are just paying the fossil fuel industry to pollute, with no climate benefit to show for it.

Congress Must Stop Wasting Money on the CCS Climate Scam

The messaging on carbon capture incentives centers the idea that we need to incentivize climate solutions so they can scale. But the truth is, we don’t need to scale carbon capture because we already have the solutions we need. Renewables are vastly cleaner, more climate-friendly, and less expensive than fossil fuels combined with carbon capture.

Researchers have broadly concluded that 100% renewable electricity in the U.S. is not only feasible, but also comparable to or cheaper than our current grid. A 2025 study found that the cost of electricity with 100% renewables would be nearly half the cost in the “business as usual” fossil fuel scenario. 

Subsidies for carbon capture would only make a fossil-fueled future even more expensive. Under 45Q, capturing every single U.S. CO₂ emission at the source would cost us $3.4-4.8 trillion over the 12 years that projects can claim the credit.

The carbon capture industry — including fossil fuel corporations — is banging on the doors of Congress, demanding even more support for carbon capture. Along with more tax incentives, they also want to fast-track dangerous carbon pipelines and other carbon capture infrastructure. 

The industry’s history of fraud, waste, abuse, and resounding failure should be a blaring alarm. We should not be giving carbon capture and fossil fuel companies even more subsidies for a technology that will hurt the climate. And we definitely shouldn’t be doing it at the expense of supporting real climate solutions like renewables.

Congress must change course on 45Q, end CCS subsidies, ban the buildout of CCS infrastructure, and invest in our 100% renewable future.