Presentation delivered to a Global CCS Institute symposium on Policy and Regulatory Frameworks for CCS in Tokyo on 3 September 2013. Presentation by Ian Havercroft of the Global CCS Institute.
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Status of Policy and Regulatory Frameworks for CCS
1. CURRENT STATUS OF POLICY AND REGULATORY
FRAMEWORKS FOR CCS
IAN HAVERCROFT
CCS Symposium on Policy and Regulatory Framework, Tokyo, Japan
3 September 2013
2. OVERVIEW
International action on CCS
United States – Federal and State-level regulation
Implementation of the European CCS Directive
Australia – completing the policy and regulatory picture
Canadian regulatory initiatives
Developing country activity
Long-term liability – a critical issue for deployment
Developing frameworks – considerations for policymakers
and regulators
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3. INTERNATIONAL ACTION
Significant developments under the auspices of international
and regional agreements have reinforced global
commitments to CCS, including:
o inclusion of CCS in the London Protocol and OSPAR
Convention;
o adoption of rules for including CCS in the Clean
Development Mechanism (CDM); and
o recognition of CCS in discussions leading up to a 2015
climate change agreement.
Establishment of an ISO Technical Committee to progress
the standardisation of CCS across the capture, transport and
storage phases.
Despite these successes, a number of outstanding issues
remain:
o ‘transboundary movement’ under the London Protocol. 2
4. UNITED STATES
Federal and State-level governments have implemented a
number of policy initiatives, which will impact upon the
development and deployment of CCS in the US.
Despite the absence of an over-arching Federal regulatory
regime for CCS:
o amendments to legislation aimed at protecting
underground sources of drinking water; and
o provide a regulatory basis for the injection of CO2 (‘Class
VI Rule’).
State-level action constitutes a far-greater body of CCS-
specific legislation.
Detailed and historical pathways for the regulation of
Enhanced Oil Recovery (EOR).
Federal and State-level regulation:
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5. UNITED STATES
Recent announcements in President Obama’s Climate Action
Plan include several issues of relevance to CCS:
o EPA directed to propose and finalise pollution standards
for both new and existing power plants;
o End of US support for the public financing of new coal
plants overseas – save for those deploying CCS.
Several anticipated legal and regulatory developments
remain outstanding:
o further guidance documents on the Class VI ‘transition’;
and
o conditional exemption from the RCRA hazardous waste
regulations for geological storage activities.
Federal and State-level regulation:
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6. EUROPE
The Directive on the geological storage of carbon dioxide
(Directive 2009/31/EC) provides a comprehensive, but
efficient regulatory model:
o addresses the novel aspects of the technology;
o utilises several familiar concepts to regulate and
incentivise;
o affords discretion to Member States (MSs) to implement
many aspects; and
o complemented by a series of guidance documents.
Original transposition deadlines were not met by the majority
of MSs, however this position has improved:
o Commission is now focusing upon the adequacy of the
national implementing legislation.
Implementation of the EU CCS Directive:
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7. EUROPE
Project proponents and regulatory agencies are already
using these nascent permitting regimes in many MSs:
o divergent approaches to transposing the Directive in
many of the jurisdictions.
However, a number of legal and regulatory issues are still to
be addressed – particularly evident in the responses to the
Institute’s annual survey of LSIPs.
Directive operates as part of a broader policy framework
developed to support the deployment of the technology.
Consultative Communication on CCS and broader Green
Paper were issued by the Commission in March 2013:
o consultation period for the Green Paper ended 2 July
2013.
Implementation of the EU CCS Directive:
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8. AUSTRALIA
Australia is an ‘early-mover’ jurisdiction - substantial policy,
legal and regulatory interventions have sought to support the
technology’s deployment.
Federal government has introduced a number of direct
support programmes for the technology, as well as enacting
a regulatory framework:
o Offshore Petroleum and Greenhouse Gas Storage Act
2006 governs storage activities in Commonwealth
waters; and
o secondary legislation provides further detail to the
permitting regimes and processes.
States of Queensland, Victoria and South Australia have also
developed regulatory models and project-specific legislation
in Western Australia.
Completing the policy and regulatory picture:
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9. AUSTRALIA
Australia’s climate change policy approach continues to evolve:
o earlier transition to an emissions trading scheme (2014);
and
o linkages with the EU ETS also brought forward.
Some regulators have indicated their regulatory frameworks are
largely complete, however:
o further work is necessary to ensure that a nationally
consistent approach is adopted; and
o legislation has yet to be enacted in New South Wales and
Western Australia.
State of Victoria has been working with the Institute to deploy
the Institute’s regulatory test toolkit:
o final report to be released by the end of the year.
Completing the policy and regulatory picture:
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10. CANADIAN REGULATORY INITIATIVES
Canada committed to CCS, which remains an integral aspect
of its climate change policies.
Legal and regulatory development has principally occurred at
the provincial level:
o Alberta, Saskatchewan, British Columbia and Nova
Scotia have all undertaken legal and regulatory activities.
Alberta remains at the forefront of legal and regulatory
developments in Canada:
o enacted amendments to oil and gas regulatory regime in
2010, which remove barriers to the technology;
o multi-stakeholder Regulatory Framework Assessment
(RFA) process concluded in December 2012; and
o RFA report was published in August 2013.
Federal and provincial action:
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11. DEVELOPING COUNTRY ACTIVITY
Increasing interest from developing countries in reducing
their domestic legal and regulatory uncertainties with regard
to CCS:
o assessment of the capacity of existing regulatory
capacity; and
o early consideration of the approach to be adopted in
regulating the technology.
The Institute has recently worked with the government of
Malaysia to undertake an assessment of their existing legal
and regulatory regime:
o considered the application of existing regulatory regimes
to a hypothetical project;
o report published by the Institute in July 2013.
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12. LONG-TERM LIABILITY
Legislation, where it addresses the issue, has largely focused
upon managing operational and long-term liabilities across
the project life-cycle:
o examples to be found in EU and Australian legislation.
Operational liabilities to be largely borne by the operator:
o obligations under a permit, remediation of damage to the
environment and ‘climate damage’.
Closure of the storage site and potential for transfer to a
competent authority:
o operator’s obligations for closure of a storage site; and
o potential for post-closure transfer of responsibilities for a
storage site under some legislation.
A critical issue for deployment:
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13. LONG-TERM LIABILITY
Uncertainties remain in some jurisdictions:
o legislation is ‘silent’ on long-term liabilities;
o possibility of residual liabilities post transfer (e.g. under
the common law); and
o ambiguity in some of the terminology and definitions.
Project surveying reveals that some issues around liability
remain critical for projects:
o ROAD permitting study includes a detailed assessment
of the legal liabilities for the project.
Efforts to clarify legislation surrounding long-term liability:
o EU Guidance Documents provide expanded analysis of
terminology and requirements in the Directive.
A critical issue for deployment:
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14. DEVELOPING REGULATORY FRAMEWORKS
Progress made to date with the development of CCS-specific
legislation, reveals several important considerations.
Pathways to regulating the technology are jurisdiction-
specific:
o Important considerations around how to address the
novel aspects of the technology;
o Interactions with existing energy and environmental
legislation – to regulate or provide incentives; and
o Specificities of domestic situation must be addressed.
Body of material which may provide useful examples and
models for new legislation:
o Work of international organisations in the L&R space –
fora for discussion and publication of resources.
Considerations for policymakers and regulators:
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