WRI Stories Feed: Carbon Capture and Sequestration (CCS)

Carbon Dioxide Capture & Storage and S. 1733, The Clean Energy Jobs & American Power Act of 2009

Sarah Forbes — Wed, 28 Oct 2009 09:50:02 -0400

The Clean Energy Jobs and American Power Act of 2009 (CEJAPA) provides a number of provisions that facilitate the demonstration and deployment of carbon dioxide capture and storage (CCS) technologies. This document provides a brief overview of the most important of these. Coal use is responsible for over 40 percent of global carbon dioxide emissions¹, and significant, deliberate action will be required to reduce these emissions. The CEJAPA lays a foundation for moving CCS technology to scale by reducing costs and providing funding for demonstrations.

Note: This summary was originally posted on October 22nd. It was revised to reflect changes in the Chairman’s markup.

The provisions for CCS in the CEJAPA include the following:

Develops a comprehensive national strategy for deployment. The bill requires Federal agencies, with EPA leadership, to develop a comprehensive strategy for commercial deployment and deliver a report to Congress within one year. The report will identify barriers and regulatory challenges and will recommend regulation, legislation, and other actions to facilitate CCS deployment (Sec. 121).
Establishes regulations for geologic storage. Amends the Clean Air Act and Safe Drinking Water Act to establish regulations for geologic storage. Requires EPA to finalize the rules for carbon dioxide geologic sequestration wells, including financial responsibility requirements, within one year. The bill also requires EPA to identify a coordinated process for certifying and permitting geologic storage sites within two years. Standards must include rules on financial responsibility of injected CO2, monitoring, record keeping, public participation and certification rules, among other things. Rules must minimize redundancy between CAA and SDWA authority (Sec. 122 and Sec. 813).
Requires emissions reporting for geologic storage sites. Geologic storage sites are regulated sources under the cap and trade program. Mandatory emissions reporting is required beginning in 2011 (Sec. 700 and Sec. 722).
Requires a formal report and evaluation of regulatory framework every three years. The bill requires EPA to formally report data on geologic storage sites, evaluate the performance of the geologic storage sites, and reassess the regulatory framework for geologic storage sites to Congress once every three years (Sec. 813).
Establishes a task force to design legal frameworks. The bill establishes a task force to provide recommendations to Congress within eighteen months that include a study of the ability of existing laws and insurance mechanisms to manage risks associated with CCS, the implications and considerations for different models for liability assumption, and subsurface property rights. The bill also requires EPA to study the means and circumstances under which existing environmental statute would apply to CCS and to present a formal report to congress within one year (Sec. 123).
Promotes R&D and early deployment of CCS. The bill establishes a Carbon Storage Research Corporation to be run by the Electric Power Research Institute (as proposed in HR 1869, introduced by Rep. Boucher). The Corporation would use funds collected through a feed-in tariff to issue grants and financial assistance for commercial-scale CCS demonstrations. Funding is capped at $1.1B per year for no more than 10 years. The bill also includes provisions for governance, government oversight, information sharing and intellectual property for both the Corporation and projects it would undertake. Commercial-scale projects undertaken by private, public, academic and non-profit organizations are eligible for funding, with an emphasis on supporting a diversity of technologies and fuels. Funding will go towards at least 5 commercial-scale integrated CCS projects, with 50% of funds to utilities that have already committed resources towards such projects (Sec.125).
Provides bonus allowances for stored carbon dioxide. The bill provides bonus allowances to the first 72 GW of facilities that implement capture and secure geologic storage or convert the carbon dioxide into a stable form. To qualify a project should reduce the facility’s annual carbon dioxide emissions by at least a 50 percent Payment is available for electric generating units fired by coal or petroleum coke at least 50 percent of the time and with a nameplate capacity of 200MW or greater (or retrofit equivalent of 200MW), and to industrial sources that emit more than 50,000 tonnes of carbon dioxide per year and do not produce liquid transportation fuel. Funds will be divided into tranches with the payment on sliding scales with higher payments for greater percentage capture, with a lower bonus provided for projects that combine geologic storage with enhanced oil recovery. Conditions for eligibility and advanced distribution of emissions allowances for these projects are specified. This program provides a mechanism for offsetting the technical risk assumed by early-adopters and a financial incentive to capture and store greater percentages of carbon dioxide than is required under the performance standards. Specifics of the bonus allowance payments are outlined below (Sec. 780):

Phase I (first 20 GW of treated CCS generating capacity, divided into two tranches):

First tranche (first 10 GW of treated generating capacity):
- Units achieving capture and storage of 90% or more of the carbon dioxide that would have otherwise been emitted would receive $96 bonus allowance value for each ton of CO2 captured and sequestered.
- Bonus allowance payment for lower percentage capture will be determined by the EPA administrator, with a minimum payment of $50 per ton of CO2 captured and sequestered for a 50 percent reduction in carbon dioxide. The payment should vary in direct proportion with increasing rates of capture receiving proportionally larger payments.
- An extra $10 per tonne bonus allowance is given for early-adopters, or those that begin operating at a 50% capture and storage rate before 2017.
- Industrial source projects are excluded under the first tranche.
Second tranche (10-20 GW of treated generating capacity):
- Units achieving capture and storage of 90% or more of the carbon dioxide that would have otherwise been emitted would receive $85 bonus allowance value for each ton of CO2 captured and sequestered.
- Bonus allowance payment for lower percentage capture will be determined by the EPA administrator, with a minimum payment of $50 per ton of CO2 captured and sequestered for a 50 percent reduction in carbon dioxide. The payment should vary in direct proportion with increasing rates of capture receiving proportionally larger payments.
Phase II (20-72 GW):
- Allowances are distributed through an annual reverse auction (unless otherwise decided by the EPA) with bids based on the desired level of incentive for 10 years of geologic storage.
- At least two of these reverse auctions will be held, and a separate auction may be held for up to five separate project categories. These categories may be defined based on coal type, capture technology, type of geologic formation and new/retrofit application.
- The EPA Administrator may prescribe a schedule for providing bonus allowances if it is determined that a reverse auction would not result in efficient and cost-effective deployment. The established bonus allowance values should cover not more than the reasonable incremental capital and operating costs for CCS.
- Phase II will be divided into tranches of not more than 10 GW.
Sets performance standards for new coal-fired power plants. The bill amends the Clean Air Act to require new coal-fired power plants to meet performance standards. The EPA Administrator must review the standards and may tighten them depending on the performance of commercially-available technology (Sec. 812).
- Standards apply to all plants permitted after January 1, 2009 where 30% or more of their fuel is coal and/or petroleum coke.
- Plants permitted from 2009-2020 must achieve a 50 percent reduction in annual emissions by 2025 or earlier (if a threshold of 10 GW of commercial deployment is met).
- Plants permitted from 2020 onward must achieve a 65 percent reduction in annual CO2 emissions from the unit.
- The onset date may be extended to 2022, if the Secretary of Energy and Administrator find insufficient commercial deployment in 2017 and Congress approves this finding.
- The standards are reviewed by the Administrator before 2020 and at 5 year intervals afterwards. The maximum carbon dioxide emissions rate for new plants may be reduced (via rulemaking) to reflect the degree of reduction achievable.
Establishes allowance allocations for the bonus allowance program. 1.7 percent of allowances are allocated to CCS, beginning in 2014 (Sec. 771):
- 1.75% of allowances from 2014-2017
- 4.75% of allowances in 2018 and 2019
- 5% of allowances from 2020-2050

International Energy Outlook 2008, Figure 76 ↩

Summary of S. 1502: The Carbon Storage Stewardship Trust Fund Act of 2009

Sarah Forbes — Tue, 04 Aug 2009 12:53:36 -0400

S. 1502 would establish a program managed by the Department of Energy to create a trust fund to ensure prompt compensation for any damages from the geologic storage of carbon dioxide. Importantly, the bill also identifies the transfer of responsibility for stewardship of a geologic site to the Federal or State government following the receipt of a site closure certificate. Site closure certification and legislative clarity in the responsibility for post-closure stewardship activities were among the recommendations proposed in Guidelines for Carbon Dioxide Capture, Transport, and Storage.

Overview of Bill

Establishes a Federal trust fund for carbon storage stewardship. The bill establishes a revolving fund in the Treasury consisting of the deposits collected by the DOE from operators of carbon dioxide storage sites. The fund may be used for civil claims that arise during the post-closure stewardship phase, costs associated with any long-term stewardship MMV or remediation, and administrative costs.
Assures the collection of funds on a per ton of carbon dioxide basis to cover post-closure stewardship costs. The bill requires the DOE to collect a risk-based fee for each ton of carbon dioxide injected. The fee will be determined by the DOE based on the annual national quantity of carbon dioxide injected, the likelihood of risk, an estimated dollar value for damages as well as the impact on commercial viability of CCS and other applicable factors. The fee may be adjusted to match the site-specific risks associated with storage to provide an incentive for selecting low-risk sites. The fee may apply to hydrocarbon recovery projects and is reviewed and adjusted on an annual basis.
Establishes a mechanism for certification of site closure. Establishes a program for site closure certification, whereby the Federal or state regulatory authority issues a certificate of closure that the carbon dioxide storage facility has completed injection, closed all wells, and completed requiring monitoring to ensure that the stored carbon dioxide does not pose harm or present a risk to human health, safety, and the environment, including drinking water supplies.
Transfers the responsibility of long-term stewardship of closed sites to the government. After the site receives a closure certificate responsibility for long-term stewardship is transferred to the Federal government (under the oversight of the Department of Energy), unless a State requests management responsibilities.
Establishes standards for measurement, monitoring and verification (MMV) and remediation during post-closure stewardship. The bill requires the DOE, in coordination with the EPA, to establish standards for post closure stewardship MMV and remediation. Responsibility for such activities would be led by DOE in coordination with EPA.
Requires private liability assurance during the active project period. The bill requires operators to maintain adequate assurance of liability prior to receipt of the site closure certificate. Such assurance may include: third-party insurance, self insurance, performance ponds, trust funds, letters of credit, and surety bonds.
Establishes a limit on liability for damages during post-closure Stewardship. The bill requires DOE to set a limit on claims for damages during post closure stewardship, based on the volume of the fund which is determined via actuarial modeling of probable damages and net present value analysis. After receipt of the certificate of closure, the operator is no longer liable for any damages, except for claims that result from gross negligence or intentional misconduct.

A First-Hand View of China’s Carbon Capture and Storage Actions

Sarah Forbes — Tue, 28 Jul 2009 16:20:51 -0400

A first-hand tour of CCS sites in China suggests possibilities for cooperation with the United States—to their mutual benefit.

Carbon capture and storage (CCS) technology involves capturing carbon dioxide emissions from fossil fuel use (coal, oil, and natural gas) and some industrial processes, (such as cement production) and storing it permanently underground. As the world’s two largest CO2-emitting countries, the United States and China are in a unique position to act together to advance CCS deployment worldwide. Both Peng China (PDF) and the U.S. already have significant CCS R&D programs, but there is growing consensus that China and the U.S. together could develop CCS more quickly than if they acted alone. The announcement last week by Energy Secretary Chu of a U.S.-China Joint Clean Energy Research Center—with CCS as one of the research tracks—is a good step forward.

Last month, a team of American CCS experts (led by Tsinghua University and WRI) got a first-hand look at China’s latest CCS development efforts. The team is part of a steering committee to develop environmental regulatory guidelines for responsible CCS deployment in China, an effort supported by the Asia Pacific Partnership. Here are a few of WRI’s key findings, based on the site visits (summaries of two visits are below) and subsequent meetings of the steering committee:

Despite the costs associated with CCS technology, China is further along than many might expect. For instance, China’s substantial experience in coal gasification (gained in a large part with recent projects that convert coal to other products), provides opportunities for CCS-ready CO2. (Our group saw more gasifiers in one-week in China than are operating today in the United States) China has announced plans to begin underground CO2 storage at research scales later this year.
China’s energy projects are very large in scale, millions of tons/year of coal per site, and get quick approval (finding ways to reduce emissions from these facilities is essential in making global reductions in carbon dioxide emissions).
Chinese industry is being proactive and together with government they are pushing the envelope with respect to innovation and plant efficiency
There are opportunities to collaborate on demonstrating CO2 storage in China using the carbon dioxide from industrial sources.

Below is a short description of two of the sites the CCS team visited during its visit to China—sites which provide opportunities for near term on-the-ground CCS demonstrations in China:

Shenhua Direct Coal to Liquids Plant in Ordos, Inner Mongolia

This project (approximately 10 billion RMB, or $1.46 billion) is a first-of-its-kind facility (PDF) which employs a Chinese-developed technology for direct coal liquefaction (DCL). The project was initiated in 2004 and completed a successful first commissioning with 303 hours of successful operations last December. The plant will soon conduct a second, 1,000 hour commissioning with full-scale operations to follow. The geology in the region looks promising, with an estimated 4.4 billion tons of CO2 storage capacity in saline formations in the Ordos basin. Geologic storage site selection and characterization efforts are underway with an anticipated CCS demonstration injecting 100,000 tons per year beginning in late 2009.

CCS team at Shenhua Plant in Ordos

GreenGen IGCC Power Plant, Tianjin

GreenGen is China’s most prominent IGCC project, owned by a consortium of all of China’s major power producers, led by Huaneng, its top coal producer, Shenhua, and potential participation by Peabody Energy. Construction of the 250MW IGCC plant began in 2008, and NDRC granted final approval in May 2009. The project will use hydrogen turbines, and a 400MW addition is planned for 2014-2016. This second phase will likely include CO2 injection of 1 million tons per year for enhanced oil recovery.

CCS team at GreenGen site in Tianjin

Steering Committee Members

In addition to the WRI CCS team, the steering committee attending this tour includes many of the leading U.S. experts on CCS technology:

Scott Anderson (EDF)
Sally Benson (Stanford University)
Robert Finley (University of Illinois and lead for one of the US DOE’s regional partnerships)
Robin Newmark (Lawrence Livermore National Laboratory)
Ming Sung (Clean Air Task Force)
Elizabeth Wilson (WRI Fellow and University of Minnesota professor)
Julio Friedmann of Lawrence Livermore, also serves as an advisor to this effort

In addition, the steering committee includes China’s industry and government leaders on CCS technology, research directors from:

Tsinghua University
China’s Institute of Mining and Technology
Shenhua (largest coal company in the world)
PetroChina (state-owned oil company)
Huaneng (one of the major utilities, implementing China’s GreenGen project, and integrated IGCC and CCS demonstration).

Officials from the National Development and Reform Commission and the National Energy Administration also met with the steering committee.

Updated: Carbon Capture and Storage and The American Clean Energy and Security Act

Sarah Forbes — Thu, 18 Jun 2009 09:55:37 -0400

This summary is an update to a previous analysis.

Inquiries can be directed to Sarah Forbes.

For more information, visit the U.S. Federal Climate Policy home page.

Coal use is responsible for over 40 percent of global carbon dioxide emissions, and significant, deliberate action will be required to reduce these emissions. The ACESA lays a strong foundation for moving CCS technology to scale by reducing costs and providing funding for demonstrations.

The American Clean Energy and Security Act of 2009 has the following strengths:

Develops a comprehensive national strategy for deployment. The bill requires Federal agencies, with EPA leadership, to develop a comprehensive strategy for commercial deployment and deliver a report to Congress within one year. The report will identify barriers and regulatory challenges and will recommend regulation, legislation, and other actions to facilitate CCS deployment. (Sec. 111)
Establishes regulations for geologic storage. Amends the Clean Air Act and Safe Drinking Water Act to establish regulations for geologic storage. Requires EPA to finalize the rules for carbon dioxide geologic sequestration wells, including financial responsibility requirements, within one year. The bill also requires EPA to identify a coordinated process for certifying and permitting geologic storage sites within two years. (Sec. 813)
Requires emissions reporting for geologic storage sites. Geologic storage sites are regulated sources under the cap and trade program. Mandatory emissions reporting is required beginning in 2011. (Sec. 700 and Sec. 722)
Requires a formal report and evaluation of regulatory framework every three years. The bill requires EPA to formally report data on geologic storage sites, evaluate the performance of the geologic storage sites, and reassess the regulatory framework for geologic storage sites to Congress once every three years. (Sec. 813)
Establishes a task force to design legal frameworks. The bill establishes a task force to provide recommendations to Congress within two years that include a study of the ability of existing laws and insurance mechanisms to manage risks associated with CCS, the implications and considerations for different models for liability assumption, and subsurface property rights. (Sec. 113)
Promotes R&D and early deployment of CCS. The bill establishes a Carbon Storage Research Corporation to be run by the Electric Power Research Institute (as proposed in HR 1689, introduced by Rep. Boucher). The Corporation would use funds collected through a feed-in tariff to issue grants and financial assistance for commercial-scale CCS demonstrations. Funding is capped at $1.1B per year for no more than 10 years. The bill also includes provisions for governance, government oversight, information sharing and intellectual property for both the Corporation and projects it would undertake. (Sec.114)
Provides bonus allowances for stored carbon dioxide. The bill provides bonus allowances to the first facilities that implement capture and secure geologic storage that results in a 50 percent reduction in annual carbon dioxide emissions. Payment is available for electric generating units fired by coal or petroleum coke at least 50 percent of the time and with a nameplate capacity of 200MW or greater, and to industrial sources that emit more than 50,000 tonnes of carbon dioxide per year and do not produce liquid transportation fuel. Funds will be divided into tranches with the payment on sliding scales with higher payments for greater percentage capture. This program provides a mechanism for offsetting the technical risk assumed by early-adopters and a financial incentive to capture and store greater percentages of carbon dioxide than is required under the performance standards.

Specifics of the bonus allowance payments are outlined below (Sec. 786).

Phase I (first 6 GW of CCS equipped plants)

Units achieving capture and storage of 85% or more of the carbon dioxide that would have otherwise been emitted would receive $90 bonus allowance value for each tonne of CO2 captured and sequestered
Bonus allowance payment for lower percentage capture will be determined by the EPA administrator, with a minimum payment of $50 per tonne of CO2 captured and sequestered for a 50 percent reduction in carbon dioxide
An extra $10 per tonne bonus allowance is given for early-adopters, or those that begin operating at a 50% capture and storage rate before 2017
A lower but undefined bonus allowance will be given to projects that combine geologic storage with enhanced oil recovery

Phase II (6-72GW)

Allowances are distributed through an annual reverse auction (unless otherwise decided by the EPA) with bids based on the desired level of incentive for 10 years of geologic storage
Allowances will be divided into a series of 6 GW tranches
Value of allowances will be on a sliding scale with higher values for greater percentage capture. Precise values will be determined by the administrator and re-evaluated every 8 years
Sets performance standards for new coal-fired power plants. The bill amends the Clean Air Act to require new coal-fired power plants to meet performance standards. The EPA Administrator must review the standards and may tighten them depending on the performance of commercially-available technology. (Sec. 812)
- Standards apply to all plants permitted after January 1, 2009 where 30% or more of their fuel is coal and/or petroleum coke
- Plants permitted from 2009-2020 must achieve a 50 percent reduction in annual emissions by 2025 or earlier (depending on the level of commercial deployment of CCS technology)
- Plants permitted from 2020 onward must achieve a 65 percent reduction in annual emissions from the unit
Allows for retrofits of existing plants to apply for bonus allowances. The bill provides criteria for retrofit facilities and specifies that such facilities should apply CCS to at least 200 MW with a 50-65 percent annual reduction in carbon dioxide emissions from the portion of the unit that has been retrofitted (as proposed in the Space amendment).

Governments Investing in CCS Demonstrations

Sarah Forbes — Mon, 08 Jun 2009 09:52:17 -0400

Recent global action to fund carbon capture and storage (CCS) technology is unprecedented. (Update: U.S. FutureGen Project revived.)

(The U.S. Department of Energy announced on Friday, June 12 that it is moving forward on the FutureGen Project in Mattoon, IL. Once built, FutureGen would be the country’s first commercial-scale integrated CCS project.)

New project funding announced last month in the European Union, Canada, Australia and the United States is building momentum for accelerating the use of CCS to reduce greenhouse gas emissions. The G8’s goal of 20 demonstrations announced by 2010–a goal that once seemed insurmountable–could be within reach.

In Australia, the federal government allocated USD$2 billion to build between two and four coal-fired power plants, each generating up to 1,000 MW, that have CCS capabilities. This funding action came shortly after Prime Minister Kevin Rudd announced the formation of the $70 million, investor-backed Global Carbon Capture and Storage Institute. (Note: All funding references in this article are in USD$.)

Canada, another coal-dependent country, announced a clean energy fund that offers nearly $600 million for CCS demonstration projects as part of its economic stimulus package.

The European Commission is also moving forward on CCS demonstrations. Last month, it submitted a call for proposals for large-scale plant demonstration. These plants would be the first in Europe to be equipped with CCS elements and would need to capture at least 250 MW of installed capacity. The proposal could cover newly built plants or existing plants, and nearly $1.5 billion will be allocated for this purpose.

The United States is also dedicating stimulus funding to CCS–$3.4 billion in total. $800 million will go to the Department of Energy’s Clean Coal Power Initiative to broaden its research on commercial-scale CCS deployment, and $1.52 billion will fund large-scale CCS from industrial sources (not coal-exclusive). While the scale of the projects are not as ambitious as those in Europe or Australia, $1 billion of remaining stimulus funding could be used to restart the cancelled FutureGen project. In addition, recent bills in Congress, including the American Clean Energy and Security Act and S. 1013, may also speed demonstration in the United States.

However, the size of the projects matter. CCS has already been demonstrated to work at small plants, but in order for CCS to contribute substantially to reducing greenhouse gases, the projects need to be demonstrated at a large power plant.

Recent global government action is a step in the right direction, but we need to move forward with implementation quickly.

Summary of S. 1013: Department of Energy Carbon Capture and Sequestration Program Amendments Act of 2009

Sarah Forbes — Mon, 11 May 2009 16:20:28 -0400

S. 1013 authorizes the Department of Energy to conduct a program to demonstrate ten commercial-scale integrated geologic storage projects, and provides a framework for selection criteria for these demonstrations. Importantly, the bill addresses the long term-stewardship challenges associated with demonstration, including both long-term monitoring requirements and liability protection.

Overview of Bill

Authorizes the Department of Energy to conduct up to 10 commercial scale demonstrations of geological storage. The bill states that such demonstrations should inject over 1 million tons of carbon dioxide each year from an industrial source for a period of 10 years. These demonstrations would be selected competitively and awarded as cooperative agreements by DOE.
Requires sufficient geologic information to prove that the storage will be safe and permanent. The bill specifies that project selection be based on geological site information, including characteristics of the storage reservoir, identification of potential leakage pathways and a plan for measurement, monitoring and verification during and after injection. The bill also requires that, prior to selection, project operators demonstrate their ability to obtain necessary environmental permits.
Provides liability protection and Federal indemnity for these demonstration projects. The bill authorizes the Secretary of Energy to indemnify projects for personal, property and environmental damages that might be above what is covered by insurance or other financial assurance measures; with the exception of liability that is caused by gross negligence or intentional misconduct. Upon receiving the closure certificate, the site may be turned over to the Federal government for long-term site management and ownership.
Addresses need for proving legal rights property rights. The bill requires proof of possessing land or land interests for injection, storage, monitoring and closure prior to project selection.
Requires compliance with existing relevant laws for environmental protection. The bill requires compliance with applicable existing regulations for well construction and operation.
Ensures that operators maintain financial assurances. The bill requires that project operators maintain financial assurances after injection until the Secretary of Energy issues a certificate of closure.
Requires the operator to remediate any leaks. The bill requires remediation of any carbon dioxide leaks that might pose danger to human health or natural resources.
Outlines criteria for site closure certification. The bill provides details on requirements for long-term monitoring, including monitoring for at least 10 years after operations cease and the injected carbon dioxide stabilizes. Proof of certification includes demonstration of four criteria:
1. location and extent of the project footprint (injected and displaced fluid)
2. no leakage of injected or displaced fluid that would endanger public health, drinking water or natural resources
3. the injected or displaced fluids are not expected to migrate in the future in a manner that would encounter a leakage pathway
4. the injection wells at the site are plugged and abandoned in accordance with applicable laws
Includes provisions for siting the demonstrations on public land. The bill authorizes the siting of a demonstration on public land, with the potential transfer of property rights, jurisdiction, and responsibility for long-term monitoring to another Federal Agency (such as the Department of Energy).
Establishes a training program for state regulators. The bill establishes and authorizes funding appropriations for a training program for state agencies involved in permitting, and oversight of carbon capture and storage demonstrations.

Summary of H.R. 1689: Carbon Capture and Storage Early Deployment Act

Sarah Forbes — Mon, 11 May 2009 16:13:47 -0400

H.R. 1689, the Carbon Capture and Storage Early Deployment Act, introduced by Rep. Rick Boucher (D-VA) in March 2009, is designed to accelerate the development and early deployment of carbon capture and storage technologies by providing a funding mechanism for commercial-scale demonstrations that is outside the traditional appropriations process.

Overview of Bill

Provides structure for establishments of the Carbon Storage Research Corporation. The bill allows for the establishment of the Carbon Storage Research Corporation; however, establishment is contingent on a referendum by a fossil-fuel based industry organization (such as Edison Electric Institute or the American Public Power Association), and state regulatory authorities maintain the right to oppose the establishment of the corporation. (Sec 3)
Collects at least $1B in annual funding from utilities. This bill authorizes the Carbon Storage Research Corporation to collect $1-1.1 billion dollars from utilities based on the amount of fossil-fuel generated electricity delivered to ratepayers. The carbon dioxide emission rates of different fossil fuels would be considered. The bill allows for use of average data and regional differences in methodology.
Allows full cost recovery for utilities. This bill includes provisions that allow the utility to recover the full costs of implementing the bill.
Provides financial assistance mechanism to support commercial-scale demonstration of carbon capture or storage technologies. This bill establishes the Carbon Capture and Storage Corporation to serve as the administrator for funding commercial-scale carbon capture or storage demonstrations, with competitive awards and preference given for projects that demonstrate and integrated approach for capture and storage.
Ensures that information learned will be publicly available while protecting intellectual property rights. This bill specifies that information learned as a result of projects funded by the Carbon Storage Research Corporation will be made publicly available and also requires establishment of policies for intellectual property rights, peer-review of program plans and publicly-accessible reports and meetings. (Section 4)
Management of the Carbon Storage Research Corporation. The bill specifies that the Corporation would operate as a division or affiliate of the Electric Power Research Institute (EPRI), and be managed by an appointed board that includes primarily distribution utilities, along with one representative each from publicly-owned utilities, rural electric cooperatives, fossil fuel producers, non-profit environmental organizations, independent generators or wholesale power providers, and consumer groups. The Secretary of Energy (or designee) and two state regulatory authorities will sit on the board as non-voting members, and an academic technical advisory committee will be established to independently assess the program and provide recommendations to the board. (Sec 3)
Texas provision ensures that renewable energy credits will be taken into account during the fee assessment. This bill includes provisions specific to the Electric Reliability Council of Texas that includes a more detailed assessment process for implementation in Texas. These provisions include specific mention of renewable energy credits.

Carbon Dioxide Capture and Storage and the American Clean Energy and Security Act of 2009

Sarah Forbes — Tue, 21 Apr 2009 14:42:00 -0400

This summary applies only to the discussion draft released on 3/31/2009 and not subsequent iterations. Inquiries can be directed to Sarah Forbes.

For more information, visit the U.S. Federal Climate Policy home page.

Note: this summary has been updated. Click here for the latest update.

The American Clean Energy and Security Act of 2009 (ACESA) provides a number of important provisions that will facilitate the demonstration and deployment of carbon dioxide capture and storage (CCS) technologies. This document provides a brief overview of the most important of these as well as some considerations for improvement. Coal use is responsible for over 40 percent of global carbon dioxide emissions, and significant, deliberate action will be required to reduce these emissions. The ACESA lays a strong foundation for moving CCS technology to scale by reducing costs and providing funding for demonstrations.

The American Clean Energy and Security Act of 2009 has the following strengths:

Establishes regulations for geologic storage. Amends the Clean Air Act and Safe Drinking Water Act to establish rules for geologic storage, including financial responsibility for injected carbon dioxide, monitoring, record keeping, public participation and certification for storage sites. (Sec. 813)
Requires emissions reporting for geologic storage sites. Geologic storage sites are included as a point of regulation, with mandatory emissions reporting required beginning in 2012. (Sec. 700 and Sec. 722)
Requires a formal report and evaluation of regulatory framework on 3-year intervals. The bill requires the EPA to formally report data on geologic storage sites, evaluate the performance of the geologic storage sites, and reassess the regulatory framework for geologic storage sites to Congress once every three years.
Establishes a task force to design legal frameworks. The bill establishes a task force to provide recommendations to Congress within two years that include a study of the ability of existing laws and insurance mechanisms to manage risks associated with CCS, the implications and considerations for different models for liability assumption, and subsurface property rights. (Sec. 113)
Requires interagency study on carbon dioxide pipelines. The bill requires the Energy Department to lead an interagency assessment of the need for and barriers to the construction and operation of carbon dioxide pipelines. The study will identify technical siting, financial and regulatory barriers, and evaluate market risk and safety requirements, with the goal of recommending regulatory, financing and siting options that could mitigate market risk and help ensure CCS-dedicated carbon dioxide pipelines are constructed. (Sec.113)
Promotes R&D and early deployment of CCS. The bill establishes a Carbon Storage Research Corporation to be run by the Electric Power Research Institute (as proposed in HR 1869, introduced by Rep. Boucher). The Corporation would use funds collected through a feed-in tariff to issue grants and financial assistance for commercial-scale CCS demonstrations. Funding is capped at $1B per year for no more than 10 years. The bill also includes provisions for governance, government oversight, information sharing and intellectual property for both the Corporation and projects it would undertake. (Sec.114)
Provides direct cash payments for stored carbon dioxide. The bill provides fixed payments to facility per tonne of carbon dioxide captured and stored. The precise payment is to be determined by the Administrator based on the incremental costs of CCS and other factors. Payment is available for coal or petroleum coke-fired electric generating units with 250MW or greater nameplate capacity, and to industrial sources that emit more than 250,000 tonnes of carbon dioxide per year (industrial source payments are not to exceed 15% total funding). Funds will be divided into tranches with the payment on sliding scales with higher payments for greater percentage capture as well as higher payment for the first installations. This provision provides a mechanism for offsetting the technical risk assumed by early-adopters and an incentive to capture and store greater percentages of carbon dioxide than is required under the performance standards (Sec. 115)
Sets performance standards for new coal-fired power plants. The bill amends the Clean Air Act to require new coal-fired power plants to meet performance standards. The EPA Administrator must review the standards and may tighten them depending on the performance of commercially-available technology. (Sec. 812)
- Standards apply to all plants permitted after January 1, 2009 where 30% or more of their fuel is coal and/or petroleum coke.
- Plants permitted from 2009-2014 must emit no more than 1,100 pounds/MWh no later than 225 and potentially earlier depending on the level of commercial deployment of CCS technology.
- Plants permitted from 2015-2019 must emit no more than 1,100 pounds/MWh at start
- Plants permitted from 2020 onward must emit no more than 800 pounds/MWh at start

Carbon Capture and Storage Critical to U.S. Climate Legislation, Says WRI’s Sarah Forbes

Paul Mackie — Tue, 21 Apr 2009 11:41:34 -0400

A briefing this morning on Capitol Hill examined the many outstanding questions about carbon dioxide capture and storage (CCS).

Sarah ForbesSarah Forbes, a senior associate and expert on CCS at the World Resources Institute (WRI), spoke at the briefing. She said, “The United States gets 40 percent of its energy from coal, so carbon dioxide capture and storage has to be a key part of climate and energy legislation. We have the full technical knowledge to begin demonstrations of this technology, and we should have started them yesterday.”

Last year, WRI released a series of detailed guidelines for carbon dioxide capture, transport and storage. The guidelines were the result of two years of research with hundreds of technical experts from federal and state governments, businesses and civil-society organizations.

“Many climate technologies seem far-fetched, but Congress can be confident that CCS is a smart technology for the United States. Establishing clear rules for how to do CCS safely would go a long way toward protecting people and ecosystems,” Forbes added.

The hearing was sponsored by <a href="http://tiberi.house.gov/">U.S. Rep. Patrick J. Tiberi</a> (R-Ohio) and <a href="http://www.charliewilson.house.gov/">U.S. Rep. Charlie A. Wilson</a> (D-Ohio)<b>.</b>

WRI’s Pershing Named No. 2 Climate Diplomat for Secretary Clinton

Paul Mackie — Mon, 23 Mar 2009 11:04:06 -0400

Dr. Jonathan Pershing today becomes the new Deputy Special Envoy for Climate Change under U.S. Secretary of State Hillary Clinton.

Dr. Jonathan Pershing

Pershing will work alongside U.S. Special Envoy for Climate Change Todd Stern, who was appointed by Clinton on January 26 as President Barack Obama’s lead climate negotiator.

For the past five-and-a-half years, since 2003, Pershing has been director of the Climate and Energy Program here at the World Resources Institute (WRI).

“I can think of no other person more fitting to handle the complexities and political considerations of creating domestic and international policy on climate, the most important issue of our time,” said WRI President Jonathan Lash. “We’ve been honored to have him build our climate team.”

At WRI, Pershing provided strategic vision for the Climate and Energy Program, which, under his leadership, grew from 4 to more than 40 people, and has a 2009 budget of more than $6.5 million.

Pershing said, “We have a huge task to do: the change in administration has not solved the problem, but rather opened a door to the possibility that we can do so. I am fortunate to have spent the past five years working with the extraordinary group at WRI and honing my thinking on how we might do this. Now the implementation phase begins.”

Pershing has served on the California Market Advisory Committee, was the facilitator for the Northeast states’ Regional Greenhouse Gas Initiative (RGGI) and for the Illinois Climate Change Advisory Group, and has testified numerous times before the U.S. Congress.

He has also advised major U.S. and multinational companies on the business strategies for climate change and building up green power. Pershing has been instrumental in WRI’s participation in the United States Climate Action Partnership.

On the international front, he is a regular participant in climate negotiations for the United Nations and was lead author for the recent Nobel-Prize winning Intergovernmental Panel on Climate Change (IPCC) Fourth Assessment Report. Pershing has led WRI’s initiative to grow the GHG Protocol into an international standard for greenhouse-gas accounting and reporting, and has been an active participant in the design of WRI’s new standards for carbon capture and storage.

Before joining WRI, he worked as the head of the energy and environment division at the International Energy Agency and served as deputy director and science advisor for the State Department’s Office of Global Climate Change.

Jennifer Layke, formerly Pershing’s deputy in WRI’s Climate and Energy Program, has been named acting director. She has been leading business and climate change initiatives at WRI since 1997.