Hunton Andrews Kurth LLP
August 1, 2013 - Virginia
The Layered Approach to Liability for Geologic Sequestration of CO2, Environmental Law and Policy Annual Review
by Fred Eames and Scott Anderson
Does the brief history of carbon capture and sequestration (“CCS”) teach that we need to make wholesale changes in liability rules to make sure people do it right, or that we need favorable economic conditions within a normal liability framework to get people to do it at all? The arguments of Professors Adelman and Duncan1 proceed from the former notion; we submit the latter.
CCS is viewed as essential if mankind is going to make a serious attempt to limit atmospheric CO2 emissions.2 Yet despite the fact that the technology of both carbon capture and sequestration have been shown at demonstration scale, we have only a limited number of permitted geologic sequestration projects in the United States and internationally. There are many oil and gas wells into which CO2 has been injected, and will in most cases remain, for enhanced recovery. We set those aside for this discussion because in those wells, something goes in and something comes back out. They do not pose significant groundwater contamination risks from brine displacement. The Adelman-Duncan article focuses on brine displacement from saline aquifers.
Adelman and Duncan argue for ranking potential sequestration sites based on risk factors, and imposing strict liability—i.e., liability even in the case of exemplary conduct—for what they term “lower-quality sites (such as sites with poor cap rock or valuable overlying aquifers).”3
There are many reasons we don’t yet have a facility permitted to inject CO2 into a deep saline aquifer under the U.S. Environmental Protection Agency’s Class VI Underground Injection Control rules (the principal rules that apply to geologic sequestration of CO2 in the U.S.), but in the opinion of some observers the reasons include the specter of liability and that the Class VI rules are viewed as onerous, particularly the rules regarding site selection.4
Footnotes:
1. David E. Adelman & Ian J. Duncan,
The Limits of Liability in Promoting
Safe Geologic Sequestration of CO
2
, 22 Duke Envtl. L. & Pol'y F. 1 (2011).
2. “The Intergovernmental Panel on Climate Change (IPCC) has concluded
that CCS can contribute between 15-55% of the cumulative emission reduction
effort to 2100, providing it with a central role within a portfolio
of low carbon technologies needed to address climate change.”
The Role of
CCS
, World Coal Ass’n, http://www.worldcoal.org/coal-the-environment/
carbon-capture-storage/the-role-of-ccs/ (accessed Mar. 18, 2013).
3. Adelman & Duncan,
supra note 1, at 53.
4. To be fair, in most circumstances there also is little economic motivation for
such projects at present. Also, a small number of Class VI permit applications
are pending.
5. Federal Requirements Under the Underground Injection Control (UIC)
Program for Carbon Dioxide (CO
2) Geologic Sequestration (GS) Wells, 75
Fed. Reg. 77230, 77233, (Dec. 10, 2010).
6
. Id, at 77247.
7. 40 C.F.R. §146.82 (2010).
8.
Id.
9.
Id. §§146.82, 146.89.
Read full article at: http://www.worldservicesgroup.com/files/emails/Hunton_Layered%20approach%20to%20liability.pdf