H.R. 1003 – Enhancing Energy Recovery Act

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Updated November 24, 2025 at 3:03 AM UTC

The Enhancing Energy Recovery Act amends the Internal Revenue Code's carbon oxide sequestration credit (Section 45Q) to create equal treatment for different ways qualified carbon oxide can be used or stored. It updates the credit amount and adds new categories for how the carbon oxide may be disposed of or utilized. The changes affect any taxpayer that claims the carbon oxide sequestration credit, such as companies involved in carbon capture, storage, or enhanced oil and gas recovery projects.

Key Provisions

Adds three specific uses for qualified carbon oxide: (i) disposal in secure geological storage, (ii) use as a tertiary injectant in enhanced oil or natural gas recovery followed by storage, and (iii) utilization as described in a new subsection, ensuring parity among these options.
Sets the credit amount at $17 per unit for tax years beginning in 2025 and 2026, then ties future amounts to an inflation adjustment factor based on $17, with a substitution of $36 for $17 in certain calculations.
Removes outdated paragraph references and updates cross‑references throughout Section 45Q and related code sections to reflect the new definitions and credit calculations.
Specifies that the amendments apply to taxable years beginning after December 31, 2024.

Legislative Activity

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1 earlier action

HouseIntro Referral Latest Action

Referred to the House Committee on Ways and Means.

Ways and Means Committee

February 5, 2025

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HouseIntro Referral

Introduced in House

February 5, 2025

HouseIntro Referral

Referred to the House Committee on Ways and Means.

Ways and Means Committee

February 5, 2025

Bill Text

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Introduced in HouseIssued February 5, 2025

I

119th CONGRESS

1st Session

H. R. 1003

IN THE HOUSE OF REPRESENTATIVES

February 5, 2025

Mr. Hern of Oklahoma introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to modify the carbon oxide sequestration credit to ensure parity for different uses and utilizations of qualified carbon oxide.

1.

Short title

This Act may be cited as the Enhancing Energy Recovery Act.

2.

Parity for different uses and utilizations of qualified carbon oxide

(a)

In general

Section 45Q of the Internal Revenue Code of 1986 is amended—

(1)

in subsection (a)—

(A)

in paragraph (2)(B)(ii), by adding and at the end,

(B)

in paragraph (3), by striking subparagraph (B) and inserting the following:

(B)

(i)

disposed of by the taxpayer in secure geological storage and not used by the taxpayer as described in clause (ii) or (iii),

(ii)

used by the taxpayer as a tertiary injectant in a qualified enhanced oil or natural gas recovery project and disposed of by the taxpayer in secure geological storage, or

(iii)

utilized by the taxpayer in a manner described in subsection (f)(5).

, and

(C)

by striking paragraph (4),

(2)

in subsection (b)—

(A)

in paragraph (1)—

(i)

by striking subparagraph (A) and inserting the following:

(A)

Except as provided in subparagraph (B) or (C), the applicable dollar amount shall be an amount equal to—

(i)

for any taxable year beginning in a calendar year after 2024 and before 2027, $17, and

(ii)

for any taxable year beginning in a calendar year after 2026, an amount equal to the product of $17 and the inflation adjustment factor for such calendar year determined under section 43(b)(3)(B) for such calendar year, determined by substituting 2025 for 1990.

, and

(ii)

in subparagraph (B), by striking shall be applied and all that follows through the period and inserting shall be applied by substituting $36 for $17 each place it appears.,

(B)

in paragraph (2)(B), by striking paragraphs (3)(A) and (4)(A) and inserting paragraph (3)(A), and

(C)

in paragraph (3), by striking the dollar amounts applicable under paragraph (3) or (4) and inserting the dollar amount applicable under paragraph (3),

(3)

in subsection (f)—

(A)

in paragraph (5)(B)(i), by striking (4)(B)(ii) and inserting (3)(B)(iii), and

(B)

in paragraph (9), by striking paragraphs (3) and (4) of subsection (a) and inserting subsection (a)(3), and

(4)

in subsection (h)(3)(A)(ii), by striking paragraph (3)(A) or (4)(A) of subsection (a) and inserting subsection (a)(3)(A).

(b)

Conforming amendment

Section 6417(d)(3)(C)(i)(II)(bb) of the Internal Revenue Code of 1986 is amended by striking paragraph (3)(A) or (4)(A) of section 45Q(a) and inserting section 45Q(a)(3)(A).

(c)

Effective date

The amendments made by this section shall apply to taxable years beginning after December 31, 2024.