Carbon Dioxide Removal Leadership Act of 2026
- Sponsor
- Rep. Tonko, Paul [D-NY-20]
- Committees
- Energy and Commerce Committee (primary)
- Last action
- Jul 27, 2026
Bottom line
The Carbon Dioxide Removal Leadership Act of 2026 establishes a federal procurement program for direct air and seawater carbon dioxide removal, aiming to scale up technology and achieve significant atmospheric carbon reduction targets while promoting economic and social benefits.
What it actually does
This bill mandates the Secretary of Energy to remove increasing amounts of carbon dioxide directly from ambient air or seawater, starting with 50,000 metric tons in fiscal years 2026-2027 and scaling to 10 million metric tons annually by fiscal year 2036. It sets economic feasibility price caps that decline over time, establishes rigorous measurement, monitoring, reporting, and verification (MMRV) standards, and prioritizes projects based on criteria such as job creation, domestic sourcing, and community benefits. The Secretary is authorized to enter into multi-year contracts to meet these requirements.
Proponents argue
Supporters argue this bill provides crucial federal leadership and a clear, long-term market signal to accelerate the development and deployment of carbon dioxide removal technologies, which are essential for meeting ambitious climate goals. They emphasize the importance of establishing clear targets, economic incentives, and robust verification standards to build a viable industry, create jobs, and address climate change comprehensively.
Opponents contend
Critics might argue that mandating specific removal targets and technologies could be premature, potentially locking in expensive or unproven solutions. They may also raise concerns about the significant financial commitment, the potential for unintended environmental impacts, or the risk of diverting resources from more immediate emissions reduction efforts.
The bill is moderately complex but its provisions are clearly laid out, making it accessible for an informed reader to understand its core mechanisms and implications within a reasonable timeframe.
Section 2(a)
Required Carbon Dioxide Removal Amounts
This provision mandates the Secretary of Energy to remove specific, escalating amounts of carbon dioxide directly from the atmosphere or seawater. The targets begin at 50,000 net metric tons for fiscal years 2026-2027, increase to 500,000 for FY2028-2030, then to 5 million for FY2031-2035, and finally reach 10 million net metric tons for FY2036 and each fiscal year thereafter. These removals must be completed within three years of the start of the fiscal year for which they are required.
Supporters argue
Supporters argue that these clear, escalating targets provide the necessary long-term demand signal to de-risk private investment, accelerate technological innovation, and scale up the nascent carbon removal industry, which is critical for achieving climate goals.
Critics contend
Critics may contend that setting such ambitious, long-term targets could lead to overspending on unproven technologies or create market distortions if the technology does not mature as rapidly as anticipated.
Tradeoffs
This provision balances the urgency of climate action with the uncertainties and costs associated with developing and deploying emerging carbon removal technologies at scale.
Section 2(d)
Economic Feasibility Price Caps
This section establishes maximum allowable prices per metric ton for carbon dioxide removal, which decline over time to incentivize cost reduction. The caps are $750/metric ton for FY2026-2027, $500 for FY2028-2030, $300 for FY2031-2033, $200 for FY2034-2036, and $150 for FY2037 and thereafter. These prices include costs for measurement, monitoring, reporting, and verification (MMRV) and can be adjusted for inflation. Multi-year contracts can lock in the price from the first fiscal year for the entire contract term.
Section 2(f)
Measurement, Monitoring, Reporting, and Verification (MMRV) Standards
This section requires the Secretary of Energy, in consultation with other federal agencies (NOAA, EPA, USDA, NIST), to establish rigorous standards for measuring, monitoring, reporting, and verifying the net metric tons of carbon dioxide removed. These standards must be established within one year of enactment and ensure best practices, safety, independent third-party verification, additionality, durability, net-negativity, and scientific rigor. The provision also explicitly prohibits double-counting carbon dioxide removed for this program with any other greenhouse gas emissions management program.
Section 2(g)
Project Prioritization Criteria
This section directs the Secretary of Energy to prioritize carbon dioxide removal projects based on several criteria. These include minimizing greenhouse gas emissions from the project itself, supporting innovative technologies with cost competitiveness, increasing the diversity of commercially available technologies, promoting domestic job creation (with preference for labor organizations, small, minority, and women-owned businesses), sourcing supply chain materials domestically, fostering economic development in fossil fuel-dependent regions, quantifying and mitigating risks to communities and the environment, and including robust public engagement and community benefit agreements.
Section 2(h)
Secretary's Contracting Authority and Limitations
This provision authorizes the Secretary of Energy to enter into one or more contracts, following a transparent and competitive process, to meet the carbon dioxide removal requirements. Contracts can be for a term of up to 15 years. A key condition is that the contracted entity is liable to remove additional carbon dioxide if any stored carbon is released. Furthermore, to promote market diversity, no single entity can be responsible for removing more than 25 percent of the net metric tons of carbon dioxide required in any fiscal year, provided there are enough other capable entities.
Requires that, to the extent practicable, at least 20 percent of the net metric tons of carbon dioxide required to be removed for fiscal years 2026 through 2035 shall be removed by 'small removal projects.' A 'small removal project' is defined as one that does not remove more than 5 percent of the total annual required net metric tons of CO2.
Section 2(c)
Why it matters:This is standard legislative practice to include specific set-asides for market diversity or to support smaller entities in emerging industries. The definition is placed with other technical terms.
Case for: Supporters argue this provision fosters innovation by ensuring smaller, potentially novel technologies or companies have a market entry point, preventing market dominance by a few large players. It promotes a more diverse and resilient carbon removal ecosystem.
Case against: Critics might suggest that mandating a set-aside could lead to less cost-effective removal if small projects are inherently more expensive, potentially hindering the overall goal of achieving removal at the lowest possible price.
Estimated impact: Could direct hundreds of thousands to millions of metric tons of CO2 removal contracts to smaller entities over the next decade, representing a significant portion of the early market.
Defines 'lifecycle basis' for calculating net CO2 removal, requiring consideration of all greenhouse gas emissions from 'cradle to grave.' This includes emissions associated with energy and feedstock inputs, distribution and transportation, indirect effects (such as land-use change), the removal process itself, carbon transport and storage (including any leakage), and embodied emissions of the equipment used in the activity.
Section 2(k)(2)
Why it matters:It is standard legislative practice to place technical definitions in a dedicated section. However, its thoroughness is crucial for the integrity of the carbon removal accounting.
Case for: Proponents argue this rigorous definition is essential to ensure that carbon removal projects genuinely result in a net reduction of atmospheric CO2, preventing projects that might appear beneficial but have high upstream or downstream emissions. It ensures true 'net-negativity.'
Case against: Some in the industry might argue that such a comprehensive lifecycle analysis could be overly complex and costly to implement, especially for nascent technologies, potentially slowing down deployment.
Estimated impact: Fundamentally shapes which projects qualify and how their effectiveness is measured, impacting billions in potential federal contracts and the overall climate integrity of the program.
Explicitly excludes technologies using 'natural photosynthesis' from the definition of 'eligible technology,' but then provides a pathway for technologies using 'gasification, pyrolysis, or sequestration of solid, nonhazardous, and cellulosic waste materials' to be considered eligible if the Secretary establishes rules for robust MMRV and environmental impact mitigation.
Section 2(k)(1)(B)(ii) and (C)
Why it matters:It's a technical distinction that clarifies the scope of the bill's focus, which is on engineered carbon removal rather than traditional land-use carbon sinks. The exception for waste materials reflects a specific policy choice to potentially include certain biomass-related methods under strict conditions.
Case for: Supporters argue this clarifies the bill's focus on direct air capture and ocean-based removal, which are distinct from land-based natural climate solutions. The exception for waste-to-carbon technologies allows for innovative approaches that might offer co-benefits like waste management, provided strict environmental safeguards are in place.
Case against: Critics of the exclusion might argue that it unnecessarily limits the scope of federal support for cost-effective natural climate solutions like afforestation or improved agricultural practices. Critics of the exception might worry about the environmental impacts or lifecycle emissions associated with waste-to-carbon technologies, even with safeguards.
Estimated impact: Directs federal procurement away from traditional nature-based solutions and towards engineered solutions, while potentially opening a new avenue for waste-to-carbon technologies if the Secretary establishes the necessary rules.