By J. Wylie Donald
The Congress may be dysfunctional but the administrative agencies are still moving the ball. A case in point is last month's Christmas present from EPA to the carbon capture and storage community. On December 17 EPA issued its final rule, Hazardous Waste Management System: Conditional Exclusion for Carbon Dioxide (CO2) Streams in Geologic Sequestration Activities. In so doing, EPA provided “regulatory clarity to help facilitate the implementation of [CCS] technology in a safe and responsible way.”
Carbon capture and storage is a technology with three distinct steps:
1. “the capture and compression of the CO2 stream from fossil-fuel power plants or other industrial sources,”2. ”[the transportation of] the CO2 stream (usually in pipelines as a supercritical fluid) to an on-site or off-site location,” and3. “inject[ion] underground for purposes of sequestration.”
The new rule addressed the third element. The rule had been foreshadowed by a 2010 recommendation from the government’s Interagency Task Force on Carbon Capture and Storage. The Task Force, instituted by President Obama, “was charged with proposing a plan to overcome the barriers to the widespread, cost-effective deployment of CCS within ten years,” and in its report assessed the progress and impediments to developing carbon capture and storage as a viable technology to combat climate change. Among other things, the Task Force recommended that EPA ““propose a Resource Conservation and Recovery Act (RCRA) applicability rule for CO2 that is captured from an emission source for purposes of sequestration.” The goal was a final rule by 2011. EPA was only two years late, which in the current climate should probably be considered timely.
Carbon dioxide is not a listed RCRA waste. Nevertheless there was concern that substances derived from the source materials and the capture process could render the carbon dioxide stream a characteristic RCRA hazardous waste. Accordingly, RCRA regulations potentially applied. EPA concluded, however, that RCRA regulation was not necessary because the stream being injected already was being regulated by Department of Transportation requirements for pipeline operations and EPA permitting requirements for underground injection in UIC Class VI injection wells. “[E]limination of exposure routes through these requirements, which are implemented through a [Safe Drinking Water Act] UIC permit, will ensure protection of human health and the environment such that RCRA subtitle C regulation would be duplicative and unnecessary.” “The UIC Class VI requirements are designed to ensure that the CO2 streams (which may include low concentrations of hazardous constituents) remain isolated in the injection zone and confined by confining zones in an appropriate, well-characterized geologic setting that is continuously monitored to ensure that the CO2 streams remain in the injection zone. “
Thus, advocates for CCS should be heartened that EPA has removed a potential impediment to deployment of CCS. But the realities of CCS implementation may make all this for naught. The Task Force report notes that ”the incremental costs of new coal-fired plants with CCS relative to new conventional coal-fired plants typically range from $60 to $95 per tonne of CO2 avoided.” With no federal program limiting CO2 emissions, the incentive to incur such costs is vanishingly small. EPA acknowledges this in its comments: “based upon current market conditions and the existing regulatory framework (i.e., lack of Federal legislation), it appears unlikely that there would be any significant expansion in CCS management for CO2 over the next several years.” Simply stated, lack of RCRA regulation is not going to be the trigger that unleashes a wave of CCS projects.
J. Wylie Donald, a partner at McCarter & English, LLP, counsels and litigates for clients on insurance coverage, environmental and products liability matters. Mr. Donald co-chairs the firm's Climate Change and Renewable Energy Practice. He draws on his substantial environmental experience, his prior non-legal technical work, and his deep involvement in risk management to assist clients in understanding and controlling the coming regulatory and non-regulatory impacts of climate change. He has tried cases and argued appeals in the state courts in New Jersey and Maryland, conducted private arbitrations and mediations, and argued motions in federal courts across the nation.
Read more at Climate Lawyers Blog by McCarter & English, LLP.
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