EPA FINANCE ADVISERS EYE PRICE-ANDERSON MODEL FOR CCS LIABILITY

An EPA panel that advises the agency on environmental financing is eyeing the Price-Anderson Act -- which insures nuclear power facilities -- as a potential model to address financial assurance and long-term stewardship issues for the agency’s ongoing rulemaking for carbon capture and sequestration (CCS).

Liability and long-term stewardship issues have long been a concern for both industry and environmentalists during the course of the rulemaking, with many sources saying that legislation may be necessary to clear up concerns. Industry officials fear that even if they follow EPA’s rule, they may still face cleanup liability under Superfund or other waste cleanup laws. And environmentalists fear that industry could be excused from liability, leaving cleanup or post-closure monitoring to states and the federal government, and encouraging less stringent closure of wells by industry.

EPA’s proposed rule provides authority for EPA’s Safe Drinking Water Act Underground Injection Control (UIC) program to create a new class of UIC wells to oversee underground storage of carbon dioxide (CO2) and other greenhouse gas emissions -- a critical issue for any climate change control program. The proposed rule, released July 15, is designed to ensure that the large-scale CO2 injections do not escape the saline storage aquifers and geologic formations that hold the gas, keeping it from coming to the surface and harming vegetation or human life, or the main concern, keeping it from moving into potential sources of drinking water through various leaks or cracks in the storage system.

A panel of EPA’s Environmental Financial Advisory Board (EFAB) at a meeting in Washington, DC, March 17 discussed ongoing research for an upcoming report and set of recommendations to the agency over its rulemaking for UIC wells for geologic sequestration of carbon dioxide (CO2).

“Our recommendations are going to have some input,” panel chair Jim Tozzi told the group, noting that they have to date had a number of meetings with EPA staff in the water office. The group, as requested by the agency has been looking at fixes based on the Resource Conservation & Recovery Act (RCRA), but is “not going to be inhibited by the organic statutes of EPA,” he said.

Mainly, Tozzi noted, there is the “likelihood . . . [that for] long term stewardship . . . there’s gonna need to be statutory authority” provided by Congress.

Consequently, the group is looking to the 1957 Price-Anderson Act as a guide. Price Anderson established a liability scheme for nuclear power plants in the incident of a nuclear incident. “By limiting liability in the event of an accident, while at the same time providing some level of public compensation for damages, the legislation served as an incentive and the nuclear power industry grew from one reactor in 1957, to 104 today,” notes released at the EFAB meeting March 17 say.

The members of the workgroup hope that a liability scheme for CCS could provide the same stability to the process, allowing industry the confidence to invest in sequestration projects.

“I am not suggesting we use the content of the Price Anderson Act and map them right into” CCS regulations, Tozzi said. Instead, the workgroup plans to use the act as a guide for determining long-term responsibility, such as looking to the act’s three tiers of liability: individual site responsibility; collective responsibility of all nuclear generators; and the responsibility of the U.S. government. .

I want to judge those . . . three topics,” Tozzi said, adding, “there may be other metrics . . . added to that.”

The group plans to focus on two recently released studies that Tozzi says meet his focus on long-term stewardship and high levels of environmental protection: one from the University of Minnesota and another by Carnegie Mellon University. The Minnesota paper, written by Elizabeth Wilson, looks at liability and accounting issues for CCS.

The Carnegie Mellon project , known as the CCSReg Project, is led by Granger Morgan of Carnegie Mellon University, the former chair of EPA’s Science Advisory Board. The project earlier this year released a report, Carbon Capture and Sequestration: Framing the Issues for Regulation, that suggested congressional action could replicate what the experts say is a worldwide trend of giving permitting authority for geological sequestration to a country’s natural resources agency, while delegating monitoring oversight to the environment agency (Inside EPA, Jan 16).

The EFAB panel plans to issue a number of papers in the coming months. The papers will address RCRA-like actions for closure/post closure; operating principles to guide the development of a long-term stewardship liability program; CCS actions by states; CCS actions by foreign governments; and the views of EPA staff on the workgroup reports, according to a summary of the workgroup’s activities provided at a March 17 EFAB meeting. -- Erica Martinson

INSIDEEPA-30-11-11