Greenstein, Singleton Bill To Provide Tax Credits To Low Carbon Concrete Manufacturers Advances
Trenton – In an effort to encourage the use of low carbon concrete throughout the state, the Senate Environment and Energy Committee today approved legislation sponsored by Senator Linda Greenstein and Senator Troy Singleton that would provide corporation business tax (CBT) credits and gross income tax (GIT) credits to concrete manufacturers that deliver certain forms of concrete associated with reduced greenhouse gas emissions for State-funded construction and improvement projects that require the use of 50 or more cubic yards of concrete.
“More than 10 billion tons of concrete are produced globally each year, with state and local governments accounting for 40 percent of all concrete consumption,” said Senator Greenstein (D-Mercer/Middlesex). “As the demand for this material continues to grow, we must ensure we are doing all that we can to lower the harmful emissions released during the production of concrete. By encouraging the use of low embodied carbon concrete, we will be able to drastically decrease our carbon emissions while still meeting the demands of construction projects. This bill would be an important step towards decarbonization in New Jersey and ensure that future generations will be able to enjoy our beautiful state and all that it offers.”
The bill, S-287, would provide a CBT or GIT credit to concrete manufacturers that deliver low embodied carbon concrete, equaling up to five percent of the project’s total concrete cost. The bill would also provide a CBT credit for the delivery of concrete that incorporates carbon capture, utilization, and storage, equaling up to three percent of the cost of concrete. Additionally, CBT credits would be provided to taxpayers that produce concrete or a major component of concrete for the costs of conducting environmental product declaration analyses.
"Carbon is the second most consumed material on Earth after water and it is responsible for almost eight percent of the world’s carbon dioxide emissions,” said Senator Singleton (D-Burlington). “Currently, the State has a goal to curb carbon emissions by 2050. With this proposal, we're incentivizing the production of low carbon concrete with an eye toward that goal."
Under the bill, the Department of Environmental Protection would be authorized to determine formula for the tax credit amounts, providing that the amount of the tax credits would be proportional to the reduction in greenhouse gas emissions below the baseline that is achieved by the concrete. An individual concrete manufacturer would be limited to a maximum CBT credit of $1 million annually. The cumulative total of tax credits issued annually would be capped at $10 million.
The bill was released from committee by a vote of 5-0.