Louisiana Tax Commission adopts rules to value carbon capture pipelines, wells and equipment ahead of 2025 tax year

BATON ROUGE, La. — The Louisiana Tax Commission adopted a set of rule changes on Oct. 23 that establish new valuation categories and tables for carbon capture, utilization and sequestration (CCUS) property — including pipelines, sequestration wells and related equipment — and approved an emergency rule to take effect Jan. 1, 2025.

At a meeting held in Senate Room E of the Louisiana State Capitol, Chairman Russo opened the session and commissioners considered a series of motions to amend the commission’s real and personal property rules and regulations for tax year 2025. An unnamed commissioner moved to “add a category for carbon capture pipelines,” a proposal described repeatedly as jointly recommended by the Louisiana Assessors Association and industry groups LOGA, LMOGA and LCA; Chairman Russo called for opposition and, hearing none, pronounced the motion adopted.

The commission adopted additional, related amendments in succession. A motion to add language on carbon capture pipelines to Chapter 13, §1303.a was approved; commissioners also approved adding language to Chapter 25, §2501D to address wells used for permanent sequestration of captured carbon and to amend §2501e so that those wells are valued “as the value per foot indicated in table 2503e times depth of the well.” The commission agreed to add a new business-activity listing in Table 2503a for CCUS property and to create a separate Table 2503e with values for carbon sequestration wells and related wells. The motions noted that CCUS equipment would generally be assigned an average economic life of 15 years and that the CCUS rules would be applicable on an interim basis until additional operational or market data support revisions.

An additional motion, made by an unnamed participant and attributed in the record to a recommendation from Assessor Conrad Como, amended Chapter 31 form 3103b to require the name, title and contact information for the owner or an authorized representative on submitted forms.

Chairman Russo moved to approve the commission’s full package of real and personal property rule changes for tax year 2025 and to adopt the emergency rule upon promulgation with an effective date of Jan. 1, 2025; the motion was adopted with no recorded opposition. Chairman Russo said the adopted motions will be posted on the commission’s website and that an update will appear in the December 2024 Louisiana Register.

The meeting record shows each change was moved and adopted without recorded opposition; no roll-call tallies or individual yes/no votes were recorded in the transcript. The meeting adjourned after acceptance of the package and publication directions.

Why it matters: The adopted changes create specific valuation categories and tables for CCUS pipelines, wells and equipment, providing assessors and property owners interim guidance for taxing emerging carbon capture infrastructure and related property while the commission waits for further operational and market data that could prompt future rule updates.

What to watch next: The commission said the adopted motions and the emergency rule will be published and posted; further revisions may follow as additional data or market information becomes available.