Guest “Mr. Loyola nailed it!” by David Middleton
It Takes Lots of Permits to Save the Planet
Every new energy project has to go through a convoluted and unpredictable federal approval process.
THE WALL STREET JOURNAL
Mario Loyola • 04/04/2021
President Biden’s infrastructure plan proposes to spend trillions of dollars toward achieving zero greenhouse emissions by 2050. It won’t reach that goal, for two reasons. First, Democrats refuse to accept that natural gas and nuclear power have to be part of any green-energy plan. Second and even more daunting, every new energy project has to go through the same federal approval process as any other infrastructure project—a process so convoluted, costly, time-consuming and unpredictable that it’s a wonder any infrastructure project gets built in America. Many don’t.
The system requires every agency with authority over a project to grant a separate permit after an independent environmental review. Project sponsors routinely spend hundreds of millions of dollars without knowing when or whether a decision will ever be made.
As lawmakers prepare to spend trillions, they should ponder that the government wouldn’t have to spend an additional cent on infrastructure if the permit-review system were rational. There is a vast supply of capital in the private economy for infrastructure projects, including the many renewable-energy projects that show a positive return on investment given subsidies that already exist.
Setting aside the obviously sarcastic remark about saving the planet, Mr. Loyola nailed it. Many governments, including our own are relying on Carbon Capture and Storage (CCS) and Carbon Capture Utilization and Storage (CCUS) as key components of their “Net Zero” strategies, offering fairly lucrative incentives for CCS/CCUS. While there is a lot of industry interest in this, there are very few commercial CCS wells in operation. CCS requires a UIC Class VI permit and it generally takes two years or longer to secure approval of a Class VI permit. As of January 2020, there were only two operational Class VI wells in the U.S.
Class VI Geologic Sequestration Wells
Underground injection for the purpose of long-term geologic sequestration of CO2 is subject to SDWA UIC regulations for Class VI wells. Class VI requirements may also apply to CO2 injection for EOR using Class II wells when EPA or the delegated state determines that there is an increased risk to USDWs.47
Two Class VI wells, both in Illinois, are currently permitted in the United States. EPA issued these final permits in 2017 for two wells injecting CO2 into a saline aquifer at the ADM ethanol plant in Illinois. In 2015, EPA issued a final Class VI permit for the FutureGen project, but the permit expired after the project was cancelled without any CO2 injection taking place.48 No state has issued a permit for a Class VI well. EPA requires that state primacy for Class VI wells would be implemented under SDWA Section 1422.
Unique Class VI Requirements
When developing minimum federal requirements for Class VI wells, EPA generally built upon Class I hazardous waste requirements. The agency added new requirements to address the unique properties of CO2 and geologic sequestration in the Class VI rule. In the preamble to the Class VI rule, EPA noted that “tailored requirements, modeled on the existing UIC regulatory framework, are necessary to manage the unique nature of CO2 injection for geologic sequestration.”49 EPA bases the regulation of CO2 injection as a separate class of wells on several unique risk factors to USDWs:
* the large volumes of CO2 expected to be injected through wells;
* the relative buoyancy of CO2 in underground geologic formations;
* the mobility of CO2 within subsurface formations;
* the corrosive properties of CO2 in the presence of water that can effect well materials; and
* the potential presence of impurities in the injected CO2 stream.50
This ironic statement was also in the CRS report:
CO2 itself is not federally regulated as a toxic or hazardous substance.
CCUS wells for enhanced oil recovery only require Class II permits, which are more easily obtained. Yet CO2 injection wells for geologic sequestration require a permitting process just as onerous as Class I wells for hazardous waste disposal:
Table 1. UIC Well Classes
|Class||Estimated Number of Permitted Wells||Percentage of Total Wells||Type of Fluid Injected|
|Class I||781||0.11%||Injection of hazardous and non-hazardous wastes into deep, isolated rock formations|
|Class II||177,763||24.22%||Injection of fluids associated with oil and natural gas production (including injection of CO2 for enhanced recovery and produced water disposal)|
|Class III||26,714||3.64%||Injection of fluids for solution mining (e.g., extracting uranium or salt)|
|Class IV||103||0.01%||Injection of hazardous or radioactive wastes through shallow wells into or above formations that contain a USDW (these wells are banned unless authorized under a federal or state groundwater remediation project)|
|Class V||528,300||72.00%||Any well used to inject non-hazardous fluids underground that does not fall under the other five classes, including storm water drainage wells, septic system leach fields, aquifer storage and recovery wells, and experimental wells; most Class V wells are used for injection of wastes into or above USDWs|
|Class VI||2||Less than .01%||Injection of CO2 into geologic formations for long-term storage or geologic sequestration (both wells at one site)|
Currently, only two states, North Dakota and Wyoming, have Class VI primary enforcement authority (AKA primacy).
States with primacy can approve permits more quickly than the EPA…. So, maybe primacy can save the planet!
Speaking of saving the planet…