Carbon Capture, Utilization, and Storage (CCUS) Investment Tax Credit (ITC)

Overview of the Carbon Capture, Utilization, and Storage (CCUS) Investment Tax Credit (ITC) program:

This ITC is related to the acquisition of property used to capture CO2 emissions from fuel combustion, industrial process or directly from the air, to transport the captured carbon and to store it or use it in industry. The CCUS ITC is available to a broad range of CCUS applications in different industrial subsectors such as concrete, plastics, and fuels. This ITC is available for CCUS projects to the extent that 10% or more of the captured CO2 is used in an eligible use.

Benefits of the Carbon Capture, Utilization, and Storage (CCUS) Investment Tax Credit (ITC) program:

• Ability to claim the credit on a corporate income tax return
• Scientific, engineering, and technical guidance

Eligibility criteria of the Carbon Capture, Utilization, and Storage (CCUS) Investment Tax Credit (ITC) program:

• To claim the CCUS ITC, the applicant must:
• Be a taxable Canadian corporation (including a taxable Canadian corporation that is a member of a partnership)
• Have a qualified CCUS project for which qualified CCUS expenditures are incurred from January 1, 2022, to December 31, 2040
• 3Employers who elect to meet the labour requirements can avoid claiming the . reduced tax credit rate.
• Conditions for qualification:
• Project plan expects CO2 capture in Canada for at least the full review period (~20 years).
• Temporary pilot or demonstration projects do not qualify.
• Projects projected eligible use percentage 10%:
• Project cannot serve a unit commissioned on or before April 7, 2022, solely for regulatory compliance under coal-fired electricity CO2 standards.