The Nickel Report

Many involved in carbon capture utilization and storage (CCUS) policy foresaw several years ago the situation we are in now:  lots of Class VI Underground Injection Control (UIC) permit applications to store CO₂, not enough speed at the US Environmental Protection Agency (EPA) to get them processed, and not enough speed by EPA to divvy up the work by delegating the permitting authority to the States. 

That’s why Congress included funding in the Bipartisan Infrastructure Law for Class VI UIC permitting:  $50 million for EPA to help States defray costs of taking over the Class VI permitting program and $25 million total for fiscal years 2022-26 for EPA itself to get the job done.

So far this assistance doesn’t seem to be working.  Two years ago EPA had roughly a dozen applications pending for Class VI permits.  Today there are 159 Class VI injection wells waiting to be permitted by the EPA. 

And the problem is likely to get worse before it gets better.  Companies with whom we have spoken are considering, and many near to announcing, more Class VI permit applications.  However, EPA does not appear to have been able to hire sufficient additional technical staff to review current and future applications.  The Department of Energy recently revealed that it is providing technical assistance to EPA’s application review process, which is the kind of goal-oriented collaboration we should promote within government.

The key to handling the backlog is getting the permitting authority out to the States.  In many cases the States are far better resourced than EPA to oversee the permitting, and many States have much more relevant experience.  Thirty-seven States have primacy for the Class II UIC permitting program, which includes underground injections of CO₂ for enhanced oil recovery and disposal of CO₂ and other gases from oil and gas production. 

Thus, many of these States already are permitting subsurface CO₂ injections in accordance with regulations to prevent endangerment of underground sources of drinking water. 

Notwithstanding differences between the Class II and Class VI regulatory programs, experts we have consulted have said that the regulatory expertise required to administer the two programs essentially is the same.

EPA needs to speed up the permit application approval process by recognizing State expertise when it reviews State applications to run the Class VI program.  Congress can help by slightly broadening the uses of the funding it provided in the Bipartisan Infrastructure Law to allow EPA to allocate more resources, if necessary, to speed up approvals of State primacy applications.

One of the public concerns about large-scale carbon storage through the Class VI program is fear of the unknown – that there are few examples of industry doing it so far.  That’s not quite true, given lengthy experience injecting CO₂ along with other gases through the Class II program.  As for lack of experience with Class VI, it’s certainly not for lack of trying.

(See our previous blog posts on Class VI primacy here and here.)