University of Wyoming faculty members recently published a comparative study identifying the regulatory shortcomings slowing the deployment of carbon dioxide utilization and storage technologies across the country.
Tara Righetti, a UW professor at the College of Law and School of Energy Resources, along with Kris Koski, an associate lecturer at SER, authored the study.
The Wyoming researchers partnered with researchers at the West Virginia University of Law and the U.S. Energy Association to prepare the study for the U.S. Department of Energy.
Scientists are working to find commercial ways to capture and store carbon dioxide deep underground. But carbon dioxide can also be used at oil fields, by injecting it into reservoirs to remove residual oil that traditional drilling processes could not extract.
As these processes become more widespread in a low-carbon future, researchers contend policy makers need to know both the legal and regulatory obstacles facing energy developers trying to advance these technologies. For examples, developers hoping to establish these technologies on federal, state or private lands can run into issues involving land, mineral, pore space or water rights, pipeline regulations, eminent domain or limits to carbon dioxide storage regulation, among others.
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“We are exceedingly proud to have our faculty members at the forefront of a decisive topic in energy development and working proactively to support Wyoming and its economy,” said Holly Krutka, executive director of the School of Energy Resources. “This publication is an important step to bridge the gap between our energy research efforts and commercial implementation.”
Federal incentives adopted in recent years could accelerate the advancement of CO2 storage and utilization across the 12 states studied.
For one, in 2018 Congress revised Section 45Q of the tax code to provide more favorable tax incentives to companies engaged in carbon capture and sequestration. The 45Q federal tax credit is given to companies for each ton of carbon dioxide they sequester in the ground. Since then, the program has received feedback from potential claimants, and the Internal Revenue Service recently proposed rules to regulate the program. The tax credit will be extended, if the federal government funding bill is signed by the president.
The study’s findings could help eliminate regulatory blindspots that pop up when projects are proposed with federal or private surface and subsurface interests.
“With the recent expansion of the 45Q tax credit and passage of House Bill 200 requiring carbon capture use and storage retrofits to power plants, we expect increased interest in the legal and regulatory requirements for CO2-EOR (enhanced oil recovery) and geologic storage,” Righetti said. “This report summarizes and illustrates the comparative completeness of Wyoming’s regulatory framework as well as identifying opportunities for additional legislative and agency action.”
House Bill 200 was passed by Wyoming’s Legislature earlier this year to encourage power producers to adopt carbon capture when producing electricity for customers. The new law gives Wyoming’s Public Service Commission the authority to set low-carbon electricity generation standards for utilities that include carbon capture.
“Wyoming’s statutes and existing law are encouraging to CO2 EOR storage projects, but there are gaps there,” Koski, one of the authors of the study said during a Dec. 3 webinar on the study.
The Energy Association hosted a webinar outlining the results of the study early this month. A recording is available on UW’s news site or here.
Follow the latest on Wyoming’s energy industry and the environment at @camillereports