Requirements for Long Term Carbon Dioxide (CO2) Storage

CO2 Responsibility Requirements – The U.S. EPA regulates two classes of storage sites under the Federal Class II wells (those used for oil- and gas-related Injection) and Class VI wells (those used for geological sequestration of CO2). States have flexibility in regulating carbon dioxide (CO2) injection and storage under those programs. Some states have passed their own legislation specifying which state agencies are authorized to regulate underground injection wells and how they may exercise their authority, including specifically which types of financial assurances and other responsibility requirements they may impose on CO2 injection and storage operators.

CO2 Storage Trust Fund – Several states have established public trust funds to pay for a state’s long-term oversight of geologic storage of CO2. These funds are often intended for mitigation of any potential environmental damage arising from geologic storage of CO2. Typically, CO2 geologic storage project operators are to be assessed a fee for each ton of CO2 injected, which is to be deposited into the trust fund.

Fourteen states implemented CO2 storage regulations in response to the 2008 enactment of the original Federal 45Q tax credit for CO2 storage. The 2018 extension and amendments to 45Q have created renewed interest in CO2 storage in these and other states.

Last updated November 2019