The climate tech company CarbonCapture Inc. and carbon storage developer Frontier Carbon Solutions LLC are jointly developing a modular direct air capture facility in Wyoming that will be able to remove 5 million tonnes per year of atmospheric CO2 by 2030, the companies announced.

The project will be scaled up over time, beginning with 5,000 tonnes per year when operations begin in late 2023. It will reach 5 Mt/y "as quickly as modules come off our production line," CarbonCapture CEO Adrian Corless said in a Sept. 8 statement.

Known as Project Bison, the direct air capture facility would be the first carbon removal project to utilize permits granted under Wyoming's Class VI well authority, which the state gained from the U.S. Environmental Protection Agency in 2020.

Project developers credit provisions within the Inflation Reduction Act that have made the project viable.

"With the passage of the Inflation Reduction Act, the proliferation of companies seeking high-quality carbon removal credits and a disruptive low-cost technology, we now have the ingredients needed to scale [direct air capture] to megaton levels by the end of this decade," Corless said.

The Inflation Reduction Act's increased 45Q tax credits and new direct pay options — which allow projects without federal tax obligations to receive cash payments in lieu of tax credits — combine to make Project Bison financially viable. The act increased 45Q tax credits from $50/tonne of CO2 captured and stored to $85/tonne for industrial and power sectors and $180/tonne for direct air capture projects.

The act also lowered the threshold for tax credit eligibility so that projects capturing and storing at least 1,000 t/y of CO2 are eligible for the credits.

"As a modular technology, we're going to grow in a modular and sustained way, so that allows us to get that kind of funding support right from the start," said Patricia Loria, vice president at CarbonCapture. "And as a small business, direct pay is incredibly important as well."

All these new ingredients made it easier for CarbonCapture and Frontier Carbon Solutions to engage with investors and corporate buyers to get the project off the ground, Loria said.

"Those things help us plan for these large-scale projects," Loria said. "This mixture of $180/tonne with these private buying commitments will allow us to drop our prices on carbon removal credits even more quickly and bring in a larger amount of corporate buyers into the field. It's been huge."

"I think that we can build up this industry with support from the public and private sector in a way that's different than what was done in previous energy transitions, and we're really excited to be at the forefront of that in the state of Wyoming," Loria said.

Commodity Insights reporter Brandon Mulder writes for S&P Platts Dimensions Pro. S&P Global Commodity Insights is owned by S&P Global Inc.

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