1.This Act may be cited as the
Carbon Storage Stewardship Trust Fund
Act of 2009
.
2.The purposes of this Act are—
(1)to promote the commercial deployment of
carbon capture and storage as an essential component of a national climate
mitigation strategy;
(2)to require private liability assurance
during the active project period of a carbon dioxide storage facility;
(3)to establish a Federal trust fund
consisting of amounts received as fees from operators of carbon dioxide storage
facilities;
(4)to establish a limit on liability for
damages caused by injection of carbon dioxide by carbon dioxide storage
facilities subject to certificates of closure;
(5)to establish a program—
(A)to certify the closure of commercial carbon
dioxide storage facilities; and
(B)to provide for the transfer of long-term
stewardship to the Federal Government for carbon dioxide storage facilities on
the issuance of certificates of closure for the facilities;
(6)to provide for the prompt and orderly
compensation for damages relating to the storage of carbon dioxide; and
(7)to protect the environment and public by
providing long-term stewardship of geological storage units.
3.In this Act:
(1)The term active project period
means the phases of the carbon dioxide storage facility through receipt of a
certificate of closure, including—
(A)the siting and construction of the
facility;
(B)carbon dioxide injection;
(C)well capping;
(D)facility decommissioning; and
(E)geological storage unit monitoring,
measurement, verification, and remediation.
(2)The term Administrator means
the Administrator of the Environmental Protection Agency.
(3)Carbon dioxide storage
facilityThe term
carbon dioxide storage facility means a facility that receives and
permanently stores or sequesters carbon dioxide within a geological storage
unit, including carbon dioxide permanently stored as a result of enhanced
hydrocarbon recovery.
(4)The term certificate of
closure means a determination issued by the Administrator or other
Federal or State regulatory authority with respect to a carbon dioxide storage
facility that certifies that the operator of the carbon dioxide storage
facility has completed injection operations, well closure, and any required
monitoring and remediation to ensure that any carbon dioxide injected into a
geological storage unit would not harm or present a risk to human health,
safety, and the environment, including drinking water supplies.
(5)The term civil claim means a
claim, cause of action, lawsuit, judgment, court order, administrative order,
government or agency order, fine, penalty, or notice of violation, for civil
relief with respect to damages or harm to persons, property, or natural
resources from the injection of carbon dioxide by a carbon dioxide storage
facility.
(6)
(A)The term damage means any
direct or indirect damage or harm to persons, property, or natural resources
from the injection of carbon dioxide into geological storage units.
(B)The term damage
includes
personal injury, sickness, real or personal property damage, natural resource
damage, trespass, subsidence losses, revenue losses, and loss of
profits.
(7)Enhanced hydrocarbon recoveryThe term enhanced hydrocarbon
recovery means the use of carbon dioxide to improve or enhance the
recovery of oil or natural gas from oil or natural gas fields.
(8)The term Fund
means the
Carbon Storage Trust Fund established by section 5(d)(1).
(9)The term geological storage
unit includes saline formations, hydrocarbon formations, basalt
formations, salt caverns, unmineable coal seams, or any other geological
formation capable of permanently storing carbon dioxide.
(10)The term liability assurance
means privately funded financial mechanisms, including third-party insurance,
self-insurance, performance bonds, trust funds, letters of credit, and surety
bonds.
(11)The term long-term stewardship
means the monitoring, measurement, verification, and remediation and related
activities associated with a carbon dioxide storage facility after issuance of
a certificate of closure.
(12)The term Program
means the
Carbon Storage Stewardship and Trust Fund Program established by section
5(a).
(13)The term Secretary means the
Secretary of Energy.
4.Long-Term Stewardship
responsibility
(a)Subject to subsection (b), the Secretary
shall be responsible for the long-term stewardship of a carbon dioxide storage
facility on the issuance of a certificate of closure for the carbon dioxide
storage facility.
(b)
(1)A State may request that the management
responsibilities associated with long-term stewardship of a carbon dioxide
storage facility located in the State be transferred to the State in accordance
with regulations established by the Secretary.
(2)If the Secretary approves a request under
paragraph (1), the State shall be responsible for the long-term stewardship of
the applicable carbon dioxide storage facility beginning on the date of the
approval in accordance with applicable Federal and State laws (including
regulations).
(3)In accordance with any regulations
established under paragraph (1), if the Secretary determines that a State that
has accepted management responsibilities under paragraph (1) has failed to
carry out the responsibilities of the State with respect to the carbon dioxide
storage facility, the Secretary shall assume long-term stewardship of the
carbon dioxide storage facility as soon as practicable after the date of the
determination.
(c)The Secretary, in coordination with the
Administrator, shall establish standards for any monitoring, measurement,
verification, and site remediation activities necessary to protect health,
safety, and the environment during long-term stewardship performed by a State
or the Federal Government.
(d)Coordination with
administratorIf long-term
stewardship is vested with the Secretary, the Secretary may coordinate
responsibility for site monitoring, measurement, verification, and remediation
and related activities with the Administrator.
5.Carbon Storage Stewardship and Trust Fund
Program
(a)There is established in the Department of
Energy the Carbon Storage Stewardship and Trust Fund Program.
(b)Liability assurance required for operators
of commercial carbon dioxide storage facilitiesNotwithstanding any other provision of
Federal or State law, in carrying out the Program, the Secretary shall require
operators of carbon dioxide storage facilities to maintain adequate liability
assurance during the active project period.
(c)
(1)In carrying out the Program, the Secretary
shall require operators of carbon dioxide storage facilities to pay a
risk-based fee, in an amount to be established in accordance with paragraph
(2), for each ton of carbon dioxide injected by the carbon dioxide storage
facility into geological storage units during the operation phase of the
facility.
(2)
(A)As soon as practicable after the date of
enactment of this Act and after taking into account the criteria described in
subparagraph (B), the Secretary shall establish—
(i)the minimum and maximum balance for the
Fund; and
(ii)the amount of the fee required under
paragraph (1).
(B)The criteria referred to in subparagraph
(A) are—
(i)the estimated quantity of carbon dioxide to
be injected annually into geological storage units by all operating commercial
carbon dioxide storage facilities;
(ii)the likelihood or risk of an incident
resulting in liability;
(iii)the likely dollar value of any damages
relating to an incident;
(iv)other factors relating to the risk of the
carbon dioxide storage facility and associated geological storage unit;
and
(v)impact on commercial and economic viability
of carbon dioxide storage facilities.
(C)In establishing the amount of the fee under
subparagraph (A)(ii), the Secretary may consider using a fee system that is
based on the level of risk associated with a specific geological storage unit
to provide an incentive for the selection and operation of the best carbon
dioxide storage facilities.
(D)Enhanced hydrocarbon recoveryThe Secretary shall determine the most
appropriate approach for charging a fee on the quantity of carbon dioxide
injected into oil and gas fields, after taking into consideration—
(i)the quantity of carbon dioxide that is
permanently stored;
(ii)whether or not the enhanced hydrocarbon
recovery operation is also being operated as a carbon dioxide storage facility;
and
(iii)any other factors that the Secretary
determines to be appropriate.
(E)The Secretary shall, on at least an annual
basis, review the Fund balance—
(i)to ensure that there are sufficient amounts
in the Fund to make the payments required under subsection (d)(3)(A);
and
(ii)to determine whether or not to increase or
decrease the amount, or discontinue collection, of the fee, after taking into
consideration—
(I)the annual quantity of carbon dioxide
injected by carbon dioxide storage facilities;
(II)the number and estimated value of claims
against the Fund; and
(III)any other relevant factors, as determined
by the Secretary.
(3)Notwithstanding section 3302 of section 31,
United States Code, the fees collected under paragraph (1) shall be deposited
in the Fund.
(d)Carbon storage trust fund
(1)There is established in the Treasury of the
United States a revolving fund, to be known as the Carbon Storage Trust
Fund
, consisting of such amounts as are deposited under subsection
(c)(3).
(2)
(A)Amounts in the Fund shall be made
available, without further appropriation or fiscal year limitation—
(i)to the Secretary for the payment of civil
claims from a carbon dioxide storage facility that are brought after a
certificate of closure for the carbon dioxide storage facility has been
issued;
(ii)to the Secretary for long-term stewardship
after the date of issuance of a certificate for closure; and
(iii)to the Secretary or other appropriate
regulatory authority to pay any reasonable and verified administrative costs
incurred by the Secretary or regulatory authority in carrying out the
Program.
(B)Amounts in the Fund shall only be used for
the purposes described in clause (i), (ii), or (iii) of subparagraph
(A).
(C)
(i)Subject to clause (ii), an aggregate claim
for damages brought under subparagraph (A)(i) shall be limited to an amount to
be established by the Secretary as soon as practicable after the date of
enactment of this Act, based on mechanisms such as—
(I)actuarial modeling of probable damage;
and
(II)net present value analysis.
(ii)If estimated or actual aggregate damages
exceed the amount established under clause (i)—
(I)the Secretary shall notify Congress;
and
(II)on receipt of notice under subclause (I),
Congress may provide for payments in excess of that amount, in accordance with
guidelines established by Congress by law.
(D)Exception for gross negligence and
intentional misconductNotwithstanding subparagraph (A), no
amounts in the Fund shall be used to pay a claim for liability arising out of
conduct of an operator of a carbon dioxide storage facility that is grossly
negligent or that constitutes intentional misconduct, as determined by the
Secretary.
(E)Procedures for adjudication of
claimsClaims of damage
brought under subparagraph (A)(i) relating to carbon dioxide in a carbon
dioxide storage facility subject to a certificate of closure shall be—
(i)filed in the United States Court of Federal
Claims; and
(ii)adjudicated in accordance with procedures
established by the United States Court of Federal Claims.
(3)
(A)If sufficient amounts are not available in
the Fund to cover potential claims during the first years of the Program, the
Secretary may request from the Secretary of the Treasury an interest-bearing
advance in funding from the Treasury to carry out the Program, subject to
subparagraph (B).
(B)The terms and conditions for the repayment
of an advance under subparagraph (A) shall be specified by the Secretary of the
Treasury.
6.Limitation on civil claims
(a)Except as provided in subsection (b), on
issuance of a certificate of closure, a civil claim or claim for the
performance of long-term stewardship responsibilities under applicable Federal
and State law, may not be brought against—
(1)the operator or owner of the carbon dioxide
storage facility subject to the certificate of closure;
(2)the generator of the carbon dioxide stored
in the applicable geological storage unit; or
(3)the owner or operator of the pipeline used
to transport the carbon dioxide to the carbon dioxide storage facility subject
to the certificate of closure.
(b)Subsection (a) shall not apply in the case
of a civil claim involving the gross negligence or intentional misconduct of an
owner, operator, or generator.