S. 2304

119th CONGRESS 1st Session

To amend of the Internal Revenue Code of 1986 to establish the mine methane capture incentive credit.

IN THE SENATE OF THE UNITED STATES · July 16, 2025 · Sponsor: Mr. Warner · Committee: Committee on Finance

S. 2304
- SEC. 1. Short title
- SEC. 2. Mine methane capture incentive credit

SEC. 1. Short title

This Act may be cited as the Methane Reduction and Economic Growth Act.

SEC. 2. Mine methane capture incentive credit

(a) In general
- of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph: Section 45Q(f)
  - (10) Methane capture
    - (A) In general
      - In the case of qualified methane—
        
        (i) paragraph (4) of subsection (a) shall be applied—
        
        by substituting for , per metric ton of CO2e (as defined in section 45Z(d)(2)) of qualified methane per metric ton of qualified carbon oxide
        
        by substituting for , and methane capture equipment carbon capture equipment
        
        by applying the following in lieu of subparagraph (B) thereof:
        
        (i) either—
        
        injected by the taxpayer for energy use—
        
        in a pipeline which satisfies the pipeline integrity management guidelines of section 192 of title 49, Code of Federal Regulations, and is in compliance with instrumental leak monitoring and other preventive and mitigative measures under section 192.935 of title 49, Code of Federal Regulations, or
        
        in a gathering system that feeds a pipeline described in subclause (I), or
        
        otherwise used for producing heat (for industrial use or to heat a structure) or other energy, in a manner that does not involve more than de-minimis release of methane into the atmosphere.
        
        (ii) the term shall mean any individual source of qualified methane such as borehole, well, or vent shaft constructed at a mining facility— qualified facility
        
        the construction of which begins before January 1, 2036,
        
        for which construction of methane capture equipment begins before such date, and
        
        which captures not less than 2,500 metric tons of CO2e methane during the taxable year,
        
        (iii) subsection (b)(2)(A)(ii) shall be applied by substituting for , and the greatest amount of methane captured at such facility in any year ending prior to the total amount of the carbon dioxide capture capacity of the carbon capture equipment in service at such facility on the day before
        
        (iv) this section shall be applied by substituting for and for in subsection (b)(2), (f)(1), (h), and (i)(1). methane capture carbon capture qualified methane qualified carbon oxide
    - (B) Qualified methane defined
      - For purposes of this paragraph, the term qualified methane means any methane which—
        
        (i) is captured from mining activities, including underground mines, abandoned or closed mines, or surface mines, by methane capture equipment,
        
        (ii) would otherwise be released into the atmosphere as industrial emission of greenhouse gas or lead to such release, and
        
        (iii) is measured at the source of capture and verified at the point of injection or utilization.
    - (C) Methane capture equipment defined
      - For purposes of this paragraph, the term methane capture equipment means equipment built to connect a qualified facility to—
        
        (i) a preexisting or new pipeline system, or
        
        (ii) to energy generation equipment, to capture qualified methane from such source.
(b) Effective date
- The amendments made by this section shall apply to qualified methane captured after December 31, 2024.

S. 2304

Table of contents

SEC. 1. Short title

SEC. 2. Mine methane capture incentive credit