Carbon Dioxide Removal Leadership Act of 2026
- Sponsor
- Sen. Coons, Christopher A. [D-DE]
- Committees
- Energy and Natural Resources Committee (primary)
- Last action
- Jul 29, 2026
Bottom line
The bill establishes a federal procurement program for direct air and ocean carbon dioxide removal, aiming to scale up carbon removal technologies through guaranteed demand and declining price targets while ensuring environmental integrity and community benefits.
What it actually does
This bill mandates the Department of Energy to procure increasing quantities of carbon dioxide removal (CDR) directly from ambient air or seawater, starting at 50,000 net metric tons in fiscal years 2026-2027 and escalating to 10 million net metric tons annually by fiscal year 2036. The procurement is subject to declining price caps and requires rigorous measurement, monitoring, reporting, and verification (MMRV) by independent third parties. It also establishes project prioritization criteria focused on innovation, domestic job creation, economic development in fossil fuel regions, and community benefits.
Proponents argue
Proponents argue this bill provides crucial market certainty and demand signals needed to accelerate the development and deployment of carbon dioxide removal (CDR) technologies, which are essential for meeting long-term climate goals. They emphasize that federal leadership can drive down costs and foster innovation, creating new jobs and economic opportunities while addressing climate change responsibly through robust verification and community engagement.
Opponents contend
Opponents might argue that mandating specific removal quantities and aggressive price caps could lead to inefficient spending or reliance on unproven technologies, potentially diverting resources from more established emissions reduction strategies. Concerns could also be raised about the environmental impacts of large-scale CDR projects or the potential for 'moral hazard' by allowing continued emissions with the promise of future removal, rather than prioritizing immediate decarbonization.
The bill is relatively short and clearly structured, making it accessible for an informed reader to understand its core provisions within a reasonable timeframe.
Section 2(a)(1)
Definition of Eligible Technology
This provision defines what qualifies as an 'eligible technology' for carbon dioxide removal under the Act. It includes equipment placed into service after January 1, 2022, that removes CO2 directly from ambient air or seawater. It explicitly excludes removal from natural subsurface springs, most natural photosynthesis, and CO2 used in enhanced oil recovery. Certain waste-to-carbon technologies (gasification, pyrolysis, or sequestration of solid, nonhazardous, and cellulosic waste materials) may be included if the Secretary determines adequate measurement, monitoring, reporting, and verification (MMRV) and environmental mitigation are possible.
Supporters argue
Supporters argue these definitions ensure that federal funds target novel, direct removal technologies with verifiable, durable storage, avoiding methods that are less effective or have negative environmental trade-offs like enhanced oil recovery. The conditional inclusion of certain waste-to-carbon technologies expands the potential pool of innovators while maintaining strict environmental and measurement safeguards.
Critics contend
Some critics might argue that excluding natural photosynthesis too broadly limits nature-based solutions, while others might contend that including waste-to-carbon technologies introduces complexities in lifecycle accounting and potential environmental justice concerns if not rigorously managed and verified.
Tradeoffs
This provision balances the desire to focus on direct air/ocean capture with the need to potentially include other innovative, verifiable carbon removal pathways, while explicitly excluding methods with known negative associations (like enhanced oil recovery).
Section 2(b)
Mandated Carbon Dioxide Removal Targets
This section requires the Secretary of Energy to remove increasing quantities of carbon dioxide, calculated on a lifecycle basis, over time. The targets begin at 50,000 net metric tons for fiscal years 2026 and 2027, escalate to 500,000 net metric tons for fiscal years 2028 through 2030, then to 5 million net metric tons for fiscal years 2031 through 2035, and finally reach 10 million net metric tons annually for fiscal year 2036 and each fiscal year thereafter.
Section 2(c)
Economic Feasibility Price Caps
This provision establishes maximum prices per metric ton of carbon dioxide that the Secretary of Energy can pay for removal, with these caps declining over time. The price cap starts at $750 per metric ton for fiscal years 2026-2027, decreases to $500 for FY2028-2030, then to $300 for FY2031-2033, $200 for FY2034-2036, and finally $150 from FY2037 onwards, with adjustments for inflation. These prices must include costs for measurement, monitoring, reporting, and verification (MMRV). Multiyear contracts are considered feasible if the initial year's price cap is met for the entire contract duration.
Section 2(e)
Small Removal Project Set-Aside
This provision requires that, to the extent practicable, at least 20 percent of the net metric tons of carbon dioxide mandated for removal from fiscal years 2026 through 2035 must be achieved through 'small removal projects.' A small removal project is defined as one that removes not more than 5 percent of the total required quantity for the applicable fiscal year.
Section 2(g)
Standards for Carbon Removal Verification
This provision mandates the Secretary of Energy, in consultation with other federal agencies (NOAA, EPA, USDA, NIST), to establish robust standards for measuring, monitoring, reporting, and verifying (MMRV) the net metric tons of CO2 removed. These standards must ensure best available practices, safety, effectiveness, additionality, durability, and net-negativity of carbon removal. All projects must contract with independent third parties for MMRV, and the provision explicitly prohibits double counting of carbon removal credits with any other greenhouse gas emissions management program.
Section 2(h)
Project Prioritization Criteria
This provision directs the Secretary of Energy to prioritize carbon removal projects based on several criteria. These include minimizing project-related greenhouse gas emissions, supporting the commercialization of innovative and cost-competitive technologies, increasing the diversity of eligible technologies, fostering domestic job creation (with preference for labor organizations, small, minority, and women-owned businesses), sourcing supply chain materials domestically, promoting economic development in fossil fuel-dependent regions, quantifying and mitigating risks to communities and the environment, and including robust public engagement and enforceable community benefits agreements.
Section 2(i)
Contracting Authority and Limitations
This provision authorizes the Secretary of Energy to enter into transparent and competitive contracts, with a maximum duration of 15 years, to meet the mandated carbon dioxide removal quantities. It also includes a limitation: to the extent there are sufficient capable entities, no single entity can be responsible for removing more than 25 percent of the net metric tons of carbon dioxide required in any given fiscal year.
Section 3
Long-Term Carbon Removal Program Study
This provision requires the Secretary of Energy, in consultation with other relevant federal agencies (NOAA, EPA, USDA), to submit a report to Congress within one year. The report must evaluate and recommend program design elements and financing options for a federal carbon dioxide removal offtake program capable of achieving gigaton-scale removal annually by 2050. The study is specifically tasked with considering various management and organizational structures, such as a government-sponsored enterprise, a government corporation, a program office within a federal agency, or a contracted service provider.
Defines 'lifecycle basis' for carbon dioxide removal as the net sum of all greenhouse gas emissions from 'cradle to grave,' including energy and feedstock inputs, indirect effects like land-use change, the removal process itself, carbon dioxide transport and storage (including any leakage), and embodied emissions of the equipment used.
Section 2(a)(2)
Why it matters:It is standard legislative practice to define terms upfront for clarity and legal precision. The detail is necessary for scientific rigor and program integrity but can make the text dense.
Case for: Proponents argue this comprehensive definition ensures that the carbon removal achieved is truly 'net negative' and accounts for all associated emissions, preventing projects that might appear beneficial but have high upstream or downstream emissions, thereby ensuring genuine climate benefits.
Case against: Critics might argue that such a broad and detailed lifecycle analysis could be complex and costly to implement, potentially creating significant barriers for projects, especially for smaller entities, or leading to disputes over methodologies and data collection.
Estimated impact: This definition significantly impacts the actual net carbon removed by each project and the overall environmental effectiveness of the program by ensuring that all associated greenhouse gas emissions are considered.
Defines 'remove' as extracting carbon dioxide from the atmosphere using eligible technology and 'durably storing' that captured carbon dioxide on a timescale equivalent to geologic storage. It specifies acceptable storage methods, including permits under the Safe Drinking Water Act for Class V or Class VI injection wells, use in building materials and mineralized carbon materials, or other durable storage methods as determined by the Secretary.
Section 2(a)(3)
Why it matters:Standard legislative practice to define key terms precisely. The details on storage are highly consequential for the long-term impact of the bill.
Case for: Proponents argue that specifying durable storage methods is essential to ensure that removed carbon remains out of the atmosphere for geological timescales, providing genuine, permanent climate benefits and preventing temporary or reversible solutions.
Case against: Some might argue that limiting storage methods could restrict innovation or make it harder for certain technologies to qualify, especially if 'other durable storage methods' are not broadly interpreted or if new, safe storage methods emerge that are not explicitly covered.
Estimated impact: This definition directly determines the long-term effectiveness and permanence of the carbon removal achieved by the program, ensuring that the climate benefits are lasting.
States that funds received pursuant to a contract entered into under this Act shall not be considered Federal assistance and shall not otherwise affect eligibility for any other Federal assistance, including tax incentives.
Section 2(f)
Why it matters:Likely placed here to clarify potential interactions with existing federal programs and incentives, ensuring that the new procurement mechanism complements rather than conflicts with other forms of federal support.
Case for: Proponents argue this provision is crucial to maximize the impact of federal support by allowing companies to 'stack' incentives (e.g., procurement contracts and tax credits), thereby accelerating investment and deployment of carbon removal technologies. It prevents the 'either/or' dilemma for companies seeking federal support.
Case against: Critics might argue that allowing 'stacking' of incentives could lead to over-subsidization of projects, potentially resulting in inefficient use of taxpayer money or creating an unfair advantage for certain companies, especially if the combined incentives exceed the actual cost of removal.
Estimated impact: This provision could significantly increase the financial attractiveness and viability of carbon removal projects by allowing them to leverage multiple forms of federal support, potentially accelerating deployment and scaling of the industry.
Prohibits carbon dioxide that is removed for the purpose of complying with any other greenhouse gas emissions management program (whether foreign, federal, state, local, or private) from being considered removed under this Act for purposes of meeting its requirements.
Section 2(g)(4)
Why it matters:This is an essential technical detail for program integrity, ensuring that the carbon removal achieved under this Act is additional and not already credited elsewhere.
Case for: Proponents argue this provision is fundamental to ensuring the additionality and integrity of the carbon removal achieved under this Act, preventing projects from being credited twice for the same removal and ensuring genuine, new climate benefits that contribute uniquely to the bill's targets.
Case against: No specific opposition is typically raised against this provision, as double counting is generally seen as undermining the effectiveness and credibility of any greenhouse gas emissions management or reduction program.
Estimated impact: This provision ensures that the reported carbon removal quantities represent distinct, additional efforts, thereby enhancing the credibility, transparency, and overall effectiveness of the federal carbon removal procurement program.