EPA Publishes Permitting Tracker For Carbon Capture And Storage Projects
EPA’s tracker provides federal guidelines and updates for carbon capture and storage (“CCS”) projects but no guarantee of a timely Class VI permit approval.
The U.S. Environmental Protection Agency (“EPA”) recently published a new tracker (available at this link) that details the EPA’s progress in reviewing Class VI permit applications. As we explained in this article, federal law requires a Class VI permit before any CCS operator may inject carbon underground.
According to the tracker, 61 CCS projects are currently under EPA review. Other CCS projects in North Dakota and Wyoming are not on the tracker because those states have taken primacy to issue Class VI permits within their borders.
EPA says it “aims to review complete Class VI applications and issue permits when appropriate within approximately 24 months.” To that end, EPA estimates the following timeline for its permitting process:
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- 30-day completeness review,
- 18-month technical review,
- 60-day preparation of draft permit,
- 30- to 45-day opportunity for public comment; and
- 90-day preparation of final permit.
That timeline, however, is no guarantee. EPA’s tracker shows several Class VI permits applications that will take more than three years to obtain approval. And, EPA’s timelines are in addition to permitting requirements at the state or local level.[1]
Delays in permitting are costly to a CCS project and can reduce the benefits to a project’s proponents. Time-sensitive benefits, for instance, may include federal grants and the section 45Q tax credit.[2] Also, state policies like California’s low-carbon fuel standard currently incentivize companies to incorporate CCS by providing marketable tax credits.[3] Those benefits may not last at their funding current levels for long. CCS operators should thus consult competent counsel to navigate the permitting system and mitigate costly delays.
Attorneys at Baird Holm LLP specialize in environmental, energy and tax law at the federal, state and local levels. Please do not hesitate to contact us if you have questions about CCS, environmental permitting or any related matter.
[1] See e.g. this article analyzing Nebraska’s Geological Storage of Carbon Dioxide Act, Neb. Rev. Stat. section 57-1601 et seq.
[2] 26 U.S.C. § 45Q. In this article, we analyzed how the Inflation Reduction Act of 2022 extends and enhances that credit in an effort to drive additional investments into CCS.
[3] See Cal. Code Regs. tit. 17, § 95480 et seq. We analyzed similar market opportunities in this article.