Sponsors (6)
Official title: Amend the Internal Revenue Code of 1986 to create a carbon border adjustment based on carbon intensity, and for other purposes.
Introduced December 17, 2025 by Sheldon Whitehouse · Last progress December 17, 2025
The bill channels federal funds and market guarantees to accelerate domestic low‑carbon industrial investment and prioritize pollution‑burdened communities, at the expense of higher federal spending, increased costs and financial risk for some firms and consumers, and added administrative complexity.
Taxpayers, domestic manufacturers, small businesses, and energy workers gain grants, rebates, low‑interest loans and auctioned contracts‑for‑difference that reduce market risk and finance investments in advanced low‑carbon industrial technology, supporting domestic production, competitiveness, and emissions reductions.
Communities with high pollution burdens and economically distressed areas receive funding priority, likely improving local air quality and creating job opportunities for residents in those areas.
Taxpayers (including middle‑class families) may ultimately finance substantial new federal spending—e.g., a $25 billion State Department climate appropriation and formula payments tied to new tax revenues—raising federal expenditures and potential tax pressure.
Consumers and taxpayers may face higher prices because the carbon intensity charge and program priorities can raise production costs for some goods.
Small businesses and manufacturers must provide at least 50% of project costs and face recapture and penalties for underperformance, increasing financial risk and potentially deterring participation.
Based on analysis of 2 sections of legislative text.
Adds a new IRC chapter creating a carbon intensity charge framework and authorizes DOE grants/rebates/low‑interest loans to deploy advanced industrial technologies.
Creates a new Internal Revenue Code chapter establishing a “carbon intensity charge” framework and adds a competitive Department of Energy program to fund deployment of advanced industrial technologies. The bill defines key terms (carbon intensity measures, baseline/benchmark values, eligible facilities/goods, Administrator/Secretary roles) and authorizes DOE to award grants, rebates, or low‑interest loans to facilities that adopt qualifying technologies or produce eligible goods tied to reduced carbon intensity.