EPA could improve permitting for carbon dioxide storage wells and make the process more transparent for communities affected by those projects, the agency’s independent watchdog said Tuesday. The agency has received millions in funding since 2021 to speed up processing of permits for carbon dioxide injected deep underground. A federal tax credit known as 45Q has made those wells more attractive to oil and gas companies, spurring a slew of new permit applications at EPA, which regulates the practice to safeguard drinking water. But while EPA has expanded its capacity to approve Class VI injection wells, it failed to spend $1.2 million appropriated for the program in 2023 within the appropriate time frame, the agency’s Office of Inspector General said in a new report.