On July 4, 2025, President Donald J. Trump signed into law H.R.1, commonly known as the One Big Beautiful Bill (OBBB). Touted by its supporters as a sweeping rollback of Green New Deal-era subsidies and a pro-growth, pro-fossil energy realignment, the OBBB is already reshaping the landscape for clean tech, carbon removal, and rural infrastructure. While many climate-forward industries face headwinds under this legislation, Verenovo Energy and the broader waste-to-energy biochar sector find themselves at a rare inflection point—with both challenges and profound opportunities ahead.
This piece offers Verenovo’s detailed analysis of how the OBBB will affect our operations, our technology customers, and the national markets we serve.
Analysis Approach
Verenovo conducted a thorough analysis of the OBBB using primary legislative sources, policy synopses, and congressional summaries available on congress.gov. Rather than relying on secondhand interpretations, we employed targeted keyword searches and cross-referenced linked sections to develop a clear and grounded understanding of the bill’s structure and implications. This approach ensured our assessment was rooted in substantive content, providing a reliable foundation for evaluating the bill’s impact on our operations and the biochar sector at large.
We believe this legislation, while controversial, creates clear market signals and strong incentives that align directly with Verenovo’s integrated model: decentralized waste-to-energy infrastructure, premium carbon-negative materials, and industrial decarbonization partnerships. We hope this analysis is helpful in informing your business decisions, and we welcome criticism and constructive feedback.
Key Provisions of the OBBB Relevant to Verenovo
| Provision | Description | Impact on Verenovo |
|---|---|---|
| Section 10201 | Rescission of IRA forest funding | Reduces federal grant flow for landowner-based carbon projects, but increases urgency for private-market solutions like biochar credits. |
| Section 10605 | Extension of USDA Bioenergy Program for Advanced Biofuels | Supports feedstock payments and could enhance co-product monetization. |
| Section 70431 | Expansion of Qualified Small Business Stock (QSBS) exclusion | Encourages investment into pre-revenue tech companies like Verenovo. |
| Section 70521 | Extension of Clean Fuel Production Credit (45Z) | Offers potential revenue for biogenic syngas utilization if the fuel pathway is certified. |
| Section 70522 | Restricts 45Q Carbon Sequestration Credit | Raises bar for point-source CCS, making biochar removal comparatively more attractive. |
| Section 50301 | Long-term timber contracting authorized | Creates stable input stream opportunities for forest co-location partners. |
| Section 10604 | Research funding for Agricultural Research Facilities | Opens grant pathways with NCSU, App State, and others on biocarbon R&D. |
Impact on Verenovo Business Model
1. Carbon Credits and 45Q Shift: A Competitive Advantage
OBBB restricts the 45Q carbon credit for point-source carbon capture and storage (CCS) (especially post-combustion) by introducing more rigid standards and caps. This fundamentally reduces competitiveness for fossil-linked removals while bolstering net-negative approaches like biochar. Our ongoing Puro.Earth certification effort, coupled with partnerships like Offstream for MRV, positions us to offer credible, high-quality carbon credits at a time when other removal options are facing regulatory and economic pressure.
2. Syngas Monetization through 45Z and Clean Fuel Markets
Section 70521 extends the 45Z Clean Fuel Production Credit. While originally intended for renewable diesel and ethanol, this credit now includes fuels derived from carbon-negative biomass—such as syngas from pyrolysis—if validated through the GREET life-cycle emissions model.
Verenovo’s syngas output depends on feedstock. When processing woody biomass, the BTU content is generally below natural gas pipeline thresholds (typically 950+ BTU/scf), limiting its direct injection potential. However, the same pyrolysis technology has been tested with alternative feedstocks like tires and municipal solid waste (MSW), producing syngas in the 800–1000 BTU/scf range. These values make the gas suitable for localized energy applications, including gensets, microgrids, and thermal systems.
If a fuel pathway is validated under GREET, this gas could qualify for 45Z tax credits, potentially generating up to $1.00 per gallon-equivalent depending on carbon intensity. This opens a powerful revenue stream—especially in rural or industrial deployments where local energy production can be paired with carbon sequestration. The ability to toggle between high-grade biochar and energy-optimized syngas modes gives Verenovo flexibility in system design and market alignment.
3. Biochar in Place of Metallurgical Coal and 45X Implications
The OBBB controversially added metallurgical coal as a “critical mineral” under Section 45X of the Internal Revenue Code, entitling it to advanced manufacturing production tax credits. This move, while politically symbolic in reaffirming support for domestic steel production, has drawn criticism from climate policy experts and environmental advocates. The inclusion of metallurgical coal highlights a broader tension between conventional carbon-intensive inputs and emerging low-carbon alternatives. It creates a wedge issue that could spur industrial buyers—especially steelmakers using electric arc furnaces (EAFs)—to seek carbon-negative feedstocks to mitigate reputational and regulatory risk.
Verenovo’s biochar, with a fixed carbon content exceeding 92% and a hydrogen-to-carbon ratio well below the 0.3 biochar standard threshold, is already being trialed by steel manufacturers and extrusion technology providers as a biocoke substitute. Our pyrolysis systems allow for scalable, on-site or regional production of biochar that meets stringent industrial criteria. Furthermore, with the Big Beautiful Bill introducing FEOC constraints (particularly for entities tied to Chinese supply chains), domestic carbon-negative material sourcing becomes not just preferable, but essential.
This transition dovetails with broader U.S. efforts to build a domestic critical materials supply chain. North Carolina is particularly well-positioned: new mining ventures have launched to support major manufacturers like Toyota, which continues to seek secure domestic sources for battery and steel-related supply chains. Against this backdrop, our team is exploring co-development opportunities with North Carolina-based research labs to validate post-processing of biochar into battery-grade materials and pilot end-use integration. By anchoring this work in academic collaboration and rigorous R&D, we aim to demonstrate that high-value carbon materials—whether for metallurgy, energy storage, or water filtration—can and should be produced domestically, sustainably, and credibly.
4. Forestry and Sawmill Partnerships Post-IRA Repeals
With IRA forestry incentives repealed, landowners and mills lose subsidies for thinning and fire mitigation. Verenovo fills the vacuum: offering sawmills a high-value pathway for slash, bark, and sawdust through on-site or near-site biochar systems. The Section 50301 authorization for long-term timber sales provides planning certainty, making mill co-location more attractive.
Complementing this shift is the recently introduced SAWMILL Act (Supporting American Wood and Mill Infrastructure with Loans for Longevity), a bipartisan proposal led by Senators Jeff Merkley (OR) and Tim Sheehy (MT). The SAWMILL Act would permanently authorize the USDA’s Timber Production Expansion Loan Guarantee Program (TPEP), providing low-interest, long-term loans to sawmills investing in modernization and capacity expansion—especially those that process hazardous fuels from public lands. This aligns powerfully with Verenovo’s strategy: as sawmills retool to process more biomass, we offer a downstream pathway that turns low-grade or hazardous wood waste into high-value carbon products. Should the Act become law, it would dramatically improve capital access for Verenovo’s prospective technology customers in the wood processing sector, lowering deployment friction and accelerating co-location agreements across the U.S. Southeast and Pacific Northwest.
5. Clean Energy and Tax Credit Rollbacks: A Differentiator
While solar and wind developers scramble to complete projects before tax credits expire, Verenovo’s platform—which does not rely on intermittent generation—becomes relatively more bankable and insulated from legislative headwinds. The OBBB dramatically accelerates the sunset of major clean energy tax credits such as Section 45Y (Clean Electricity Production Credit) and 48E (Clean Electricity Investment Credit), with projects required to commence construction by July 4, 2026, or be placed in service by December 31, 2027, to remain eligible. Additionally, the law imposes new restrictions tied to Foreign Entities of Concern (FEOC), barring eligibility for credits if projects source components or financing from certain countries (notably China) or are majority owned by such entities.
These changes have triggered a scramble in the utility-scale solar and wind markets, resulting in significant financing risk, anticipated Power Purchase Agreement (PPA) price hikes, and cancellation of delayed projects. Moreover, the bill allows the IRS to recapture credits if FEOC compliance is violated post-award, compounding uncertainty. In contrast, Verenovo’s decentralized pyrolysis systems are manufactured domestically, run on continuous biomass feedstock, and generate both energy and sequestered carbon byproducts without dependency on volatile global supply chains. Our model is not subject to Section 45Y/48E phaseouts, FEOC restrictions, or multi-year permitting bottlenecks. This positions us as a lower-risk, high-reward climate infrastructure investment in the emerging post-OBBB landscape.
Strategic Recommendations for Partners and Policymakers
For Municipal Leaders: The loss of federal climate block grants (Sec. 60016) creates pressure to seek decentralized, capital-light infrastructure. A Verenovo deployment can solve waste burdens, generate local jobs, and offer performance-based carbon credit revenue.
For Industrial Buyers: As 45Q becomes less viable, biochar emerges as the lowest-friction, climate-aligned input for EAF steel, aquaculture, filtration, and regenerative ag. Engage now to secure pre-commission offtake.
For Policymakers in North Carolina: With several municipalities and counties engaged in early-stage partnerships, North Carolina has a chance to lead the post-OBBB climate economy. We recommend:
- Fast-tracking permitting for biochar sites under forestry/ag zoning
- Directing Golden LEAF and AgWRAP funds to biochar-integrated infrastructure
- Advocating for state-level biochar credits pegged to sequestration value
Conclusion
Despite the rollback of many federal clean energy policies, the OBBB positions Verenovo to grow. Our diversified model—built on science, decentralization, and direct customer value—offers resilience in a volatile policy era. As others retool or retreat, we are doubling down on deployment, licensing, and research. This is a turning point. We are ready.