[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]






                    SCIENCE OF CAPTURE AND STORAGE:
                   UNDERSTANDING EPA'S CARBON RULES 

=======================================================================

                             JOINT HEARING

                               BEFORE THE

                     SUBCOMMITTEE ON ENVIRONMENT &
                          SUBCOMMITTEE ENERGY

              COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY
                        HOUSE OF REPRESENTATIVES

                             SECOND SESSION

                               __________

                             MARCH 12, 2014

                               __________

                           Serial No. 113-68

                               __________

 Printed for the use of the Committee on Science, Space, and Technology

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       Available via the World Wide Web: http://science.house.gov
       
       
       
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              COMMITTEE ON SCIENCE, SPACE, AND TECHNOLOGY

                   HON. LAMAR S. SMITH, Texas, Chair
DANA ROHRABACHER, California         EDDIE BERNICE JOHNSON, Texas
RALPH M. HALL, Texas                 ZOE LOFGREN, California
F. JAMES SENSENBRENNER, JR.,         DANIEL LIPINSKI, Illinois
    Wisconsin                        DONNA F. EDWARDS, Maryland
FRANK D. LUCAS, Oklahoma             FREDERICA S. WILSON, Florida
RANDY NEUGEBAUER, Texas              SUZANNE BONAMICI, Oregon
MICHAEL T. McCAUL, Texas             ERIC SWALWELL, California
PAUL C. BROUN, Georgia               DAN MAFFEI, New York
STEVEN M. PALAZZO, Mississippi       ALAN GRAYSON, Florida
MO BROOKS, Alabama                   JOSEPH KENNEDY III, Massachusetts
RANDY HULTGREN, Illinois             SCOTT PETERS, California
LARRY BUCSHON, Indiana               DEREK KILMER, Washington
STEVE STOCKMAN, Texas                AMI BERA, California
BILL POSEY, Florida                  ELIZABETH ESTY, Connecticut
CYNTHIA LUMMIS, Wyoming              MARC VEASEY, Texas
DAVID SCHWEIKERT, Arizona            JULIA BROWNLEY, California
THOMAS MASSIE, Kentucky              MARK TAKANO, California
KEVIN CRAMER, North Dakota           ROBIN KELLY, Illinois
JIM BRIDENSTINE, Oklahoma
RANDY WEBER, Texas
CHRIS COLLINS, New York
VACANCY
                                 ------                                

                      Subcommittee on Environment

                 HON. DAVID SCHWEIKERT, Arizona, Chair
JIM BRIDENSTINE, Oklahoma            SUZANNE BONAMICI, Oregon
F. JAMES SENSENBRENNER, JR.,         JULIA BROWNLEY, California
    Wisconsin                        DONNA F. EDWARDS, Maryland
DANA ROHRABACHER, California         MARK TAKANO, California
RANDY NEUGEBAUER, Texas              ALAN GRAYSON, Florida
PAUL C. BROUN, Georgia               EDDIE BERNICE JOHNSON, Texas
JIM BRIDENSTINE, Oklahoma
RANDY WEBER, Texas
LAMAR S. SMITH, Texas
                                 ------                                

                         Subcommittee on Energy

                  HON. CYNTHIA LUMMIS, Wyoming, Chair
RALPH M. HALL, Texas                 ERIC SWALWELL, California
FRANK D. LUCAS, Oklahoma             ALAN GRAYSON, Florida
RANDY NEUGEBAUER, Texas              JOSEPH KENNEDY III, Massachusetts
MICHAEL T. McCAUL, Texas             MARC VEASEY, Texas
RANDY HULTGREN, Illinois             MARK Takano, California
THOMAS MASSIE, Kentucky              ZOE LOFGREN, California
KEVIN CRAMER, North Dakota           DANIEL LIPINSKI, Illinois
RANDY WEBER, Texas                   EDDIE BERNICE JOHNSON, Texas
LAMAR S. SMITH, Texas















                            C O N T E N T S

                             March 12, 2014

                                                                   Page
Witness List.....................................................     2

Hearing Charter..................................................     3

                           Opening Statements

Statement by Representative David Schweikert, Chairman, 
  Subcommittee on Environment, Committee on Science, Space, and 
  Technology, U.S. House of Representatives......................    10
    Written Statement............................................    10

Statement by Representative Suzanne Bonamici, Ranking Minority 
  Member, Subcommittee on Environment, Committee on Science, 
  Space, and Technology, U.S. House of Representatives...........    11
    Written Statement............................................    13

Statement by Representative Eric Swalwell, Minority Ranking 
  Member, Subcommittee on Energy, Committee on Science, Space, 
  and Technology, U.S. House of Representatives..................    14
    Written Statement............................................    15

Statement by Representative Cynthia Lummis, Chairman, 
  Subcommittee on Energy, Committee on Science, Space, and 
  Technology, U.S. House of Representatives......................    16
    Written Statement............................................    17

Statement by Representative Eddie Bernice Johnson, Ranking 
  Member, Committee on Science, Space, and Technology, U.S. House 
  of Representatives.............................................
    Written Statement............................................    17

                               Witnesses:

                                Panel I

David Hawkins, Director of Climate Change Programs, Natural 
  Resources Defense Council
    Oral Statement...............................................    18
    Written Statement............................................    20

Robert G. Hilton, Vice President, Power Technologies for 
  Government Affairs, Alstom Power Inc.
    Oral Statement...............................................    45
    Written Statement............................................    48

Robert C. Trautz, Senior Project Manager, Electric Power Research 
  Institute
    Oral Statement...............................................    62
    Written Statement............................................    64

Scott Miller, General Manager and CEO, City Utilities of 
  Springfield Missouri, American Public Power Association
    Oral Statement...............................................    72
    Written Statement............................................    74

Panel I Discussion...............................................    86


                                Panel II

Janet McCabe, Acting Assistant Administrator, Office of Air and 
  Radiation, U.S. Environmental Protection Agency
    Oral Statement...............................................   106
    Written Statement............................................   108

Panel II Discussion..............................................   115

             Appendix I: Answers to Post-Hearing Questions

Robert G. Hilton, Vice President, Power Technologies for 
  Government Affairs, Alstom Power Inc...........................   136

Robert C. Trautz, Senior Project Manager, Electric Power Research 
  Institute......................................................   142

Scott Miller, General Manager and CEO, City Utilities of 
  Springfield Missouri, American Public Power Association........   149

Janet McCabe, Acting Assistant Administrator, Office of Air and 
  Radiation, U.S. Environmental Protection Agency................   156

            Appendix II: Additional Material for the Record

Article submitted for the record by Cynthia Lummis, Chairman, 
  Subcommittee on Energy, Committee on Science, Space, and 
  Technology, U.S. House of Representatives......................   190

Letter submitted for the record by David Schweikert, Member, 
  Subcommittee on Energy, Committee on Science, Space, and 
  Technology, U.S. House of Representatives......................   195

Letter submitted for the record by Ralph Hall, Member, Committee 
  on Science, Space, and Technology, U.S. House of 
  Representatives................................................   197

Article submitted for the record by Ralph Hall, Member, Committee 
  on Science, Space, and Technology, U.S. House of 
  Representatives................................................   201

Study submitted by Representative Randy Neugebauer, Member, 
  Subcommittee on Energy, Committee on Science, Space, and 
  Technology, U.S. House of Representatives......................   204

Letter submitted by Representative Kevin Cramer, Member, 
  Subcommittee on Energy, Committee on Science, Space, and 
  Technology, U.S. House of Representatives......................   211

White paper submitted by Representative Randy Weber, Member, 
  Committee on Science, Space, and Technology, U.S. House of 
  Representatives................................................   218

Report submitted by Representative Jim Bridenstine, Member, 
  Subcommittee on Energy, Committee on Science, Space, and 
  Technology, U.S. House of Representatives......................   222

Letter submitted by Representative Jim Bridenstine, Member, 
  Subcommittee on Energy, Committee on Science, Space, and 
  Technology, U.S. House of Representatives......................   229

 
                    SCIENCE OF CAPTURE AND STORAGE:
                    UNDERSTANDING EPA'S CARBON RULES

                              ----------                              


                       WEDNESDAY, MARCH 12, 2014

                  House of Representatives,
   Subcommittee on Environment and Subcommittee on 
                                            Energy,
               Committee on Science, Space, and Technology,
                                                   Washington, D.C.

    The Subcommittees met, pursuant to call, at 10:07 a.m., in 
Room 2318 of the Rayburn House Office Building, Hon. David 
Schweikert [Chairman of the Subcommittee on Environment] 
presiding.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    Chairman Schweikert. The joint hearing of the Subcommittee 
on Environment and the Subcommittee on Energy will come to 
order, and there is the gavel.
    I want to thank everyone for joining us today. Welcome to 
today's joint hearing titled ``Science of Capture and Storage: 
Understanding EPA's Carbon Rules.''
    In front of each Member are packets containing the written 
testimony, biographies and Truth in Testimony disclosures for 
today's witnesses.
    Before we get started, since this is a joint hearing 
involving two subcommittees, I want to explain how we will 
operate procedurally to all the Members and understand how the 
question-and-answer periods are going to work. After 
recognition of the Chair, and Ranking Members of the 
Environment and Energy Committee, we will recognize those 
Members present at the gavel in order of seniority on the Full 
Committee? Okay. It probably should be--well, we will go with 
the full Committee because that is how we wrote it before. And 
those coming in after the gavel will be recognized in order of 
arrival.
    Let me recognize myself for just a couple minutes as sort 
of an opening statement. And I always drive staff a little nuts 
when I do this. I am going to go somewhat off script. I spent 
the last two days trying to read everything I get my hands on, 
the individual testimonies, data and information provided from 
the EPA and other just random articles. Fascinating subject 
area.
    But my fear is, let us see if I can find an elegant way to 
express this, is sort of the law of unintended consequences. So 
as we are having the weaving of the discussion, what I would 
love woven into that discussion is the underlying technology, 
the underlying science. And symbolically, let us see if I can 
make this make sense. At home in my desk, I have the first-
generation iridium phone--many of you remember that--will a 
little plaque on it saying just because you can engineer it, 
doesn't mean you should do it. That actually sort of weaves 
through this. We have much of the scientific capability, at 
least theoretically, but have we stressed it? Do we truly 
understand the unintended consequences? Do we also understand 
what carbon sequestration, or ACO2, as it is often 
referred to in the literature, where we would be 50 years from 
now, 100 years from now, even after some of those capturing 
facilities have been shuttered? Where are we truly technology-
wise? And then also then the weaving of the discussion of the 
proposed rule sets and are those rule sets appropriate, robust, 
and what is the cost curve on those for adoption, you know, 
have we made the cost curve something where now it is a 
theoretical discussion that we have now actually priced out of 
practice.
    [The prepared statement of Mr. Schweikert follows:]

     Prepared Statement of Environment Subcommittee Chairman David 
                               Schweikert

    I want to thank the witnesses for being here today. Your expertise 
is invaluable in helping this committee understand the practical and 
sometimes negative and damaging effects of EPA rulemaking. We are here 
to learn the facts about carbon capture and storage. And more 
specifically, we are here to see whether those facts support what EPA 
has proposed.
    When I look at the EPA's new source performance standards proposal, 
I'm reminded of the Air Force's plans to develop a nuclear powered 
plane. That's right--a nuclear powered plane! They called it Project 
Pluto or ``The Flying Crowbar.''
    Americans knew the power of atomic weaponry and military tools. The 
components had been tested. We had jet planes and nuclear reactors.
    But something happened in moving from a dream to reality. The 
reality was that nuclear power worked, but only under specific 
controlled conditions, and in limited applications. And with a lot of 
supervision, testing and well trained staff.
    Of course in hind sight, we understand that ``Project Pluto's'' 
nuclear powered aircraft would have been a disaster--and we luckily 
avoided that. We never built a fleet of ``Flying Crowbars.'' In this 
way, Carbon Capture Storage is similar. It might work under specific 
conditions, but not everywhere. And we have no reason to believe it 
will work at the scale EPA is expecting us to believe.
    This Administration has made no secret that it is an enemy to 
affordable fossil fuels, including coal. From what I have witnessed it 
appears the Administration would rather see carbon capture and storage 
fail altogether.
    It was candidate Obama who famously said that if you want to build 
a coal plant you can--it's just that it will bankrupt you. With this 
rule it looks like the President is keeping that old campaign promise--
to bankrupt coal. But at least they are being upfront about CCS for 
coal power. What's more troubling is what's hinted at but left unsaid. 
I want to know what this rule will really do, not just today but five, 
ten, twenty years down the road.
    While the Administration likes to tout the economic benefits the 
natural gas revolution is bringing us, they are simultaneously 
attacking this affordable and renewable energy source. Likewise, this 
rule is at odds with the Administration's claimed goal: addressing 
global CO2 concentrations. The EPA's rule on carbon capture and storage 
would actually halt CCS research and development.
    These rules are simply a thinly veiled attempt to prevent new coal 
power and eventually take down natural gas.
    Does the EPA think Americans cannot see past their empty rhetoric? 
There are towns and communities all across this nation that want this 
administration to uphold their all of the above energy strategy.
    But even if environmental extremists could prevent American's from 
enjoying reliable and affordable fossil fuels, developing countries 
have no intention of giving up fossil fuels. So an EPA rule that 
derails carbon capture and storage development will be disastrous.
    Here's the bottom line: The Administration's rhetoric is 
disingenuous at best.
    America is long overdue for a frank conversation about the future 
of our domestic energy solutions. No more hiding-the-ball. Let's take a 
step back from the end-of-the-world-scenarios-on both sides. Gather the 
facts. And have an honest discussion about the consequences of our 
policy choices. EPA's new source performance standards rule requires 
something that doesn't exist yet-full-scale power with at least 40% 
carbon capture and storage.
    The Agency largely justifies the proposal on an assumption that 
captured CO2 will be used in enhanced oil recovery (EOR) operations.
    The EPA has touted that the sale of CO2 would help offset the 
incredible costs of the capture side of CCS systems. But EPA's new 
source performance standards for power plants require full scale power 
with at least forty perfect carbon capture systems. In addition, the 
standards add new requirements to enhanced oil recovery options that 
effectively remove it as a compliance option.
    These Oil Recovery operators can't comply, leaving power plants 
with no option but geologic sequestration. But permanent geologic 
sequestration has serious, unresolved scientific, legal, and regulatory 
problems.
    This rule twists the clear language of the Clean Air Act and allows 
the EPA to require energy producers to use unproven technology. It sets 
up obstacles to compliance that undercut the very technology it claims 
to promote. This isn't about climate change. It's about expanding 
federal power and it sets a dangerous precedent.
    Let's have a discussion that plays this rule out to its logical 
conclusion. Then we can consider if that's a place we want to go as a 
nation.

    Chairman Schweikert. So with that as an opening statement, 
I will turn to my Ranking Member, Ms. Bonamici, for her opening 
statement.
    Ms. Bonamici. Thank you very much, Mr. Chairman, and thanks 
to the Chair of the Energy Subcommittee--I know Ms. Lummis is 
on her way--for holding this morning's hearing.
    Today we are going to be discussing the performance 
standards proposed by the Environmental Protection Agency --
EPA--for carbon dioxide emitted from new power plants. This is 
a hearing that is similar to one we held last fall, but this 
time we have the opportunity to hear directly from the EPA 
about this important issue, and I would like to thank Acting 
Administrator Janet McCabe for being here today and I would 
also like to thank the witnesses on our first panel for their 
thoughtful testimony, which I have reviewed.
    Last year, President Obama laid out an agenda to address 
one of the biggest environmental challenges of our time: 
climate change. A key component of that plan, and any effort to 
reduce the amount of carbon emitted by the United States, is 
the need to significantly lower the amount of carbon produced 
during electricity generation. Emissions from power plants 
represent about a third of the greenhouse gases produced by the 
United States, and EPA's proposed rule takes an important first 
step in tackling this major source of carbon pollution.
    To emphasize: the proposed rule sets carbon limits on new 
power plants, not existing plants or those under construction. 
Looking at current and future market conditions, especially 
competitive natural gas prices, it is likely that many if not 
most new power plants will be able to meet the proposed carbon 
limits. It is the market, not the proposed rule, that is 
contributing to the proliferation of natural gas power plants 
over coal. In my home State of Oregon for example, our last 
coal plant is scheduled to be closed by 2020, and some of that 
generation capacity will be replaced with a natural gas plant.
    The proposed EPA rule will create a market incentive for 
the continued development and promotion of carbon capture and 
storage, or CCS, technologies. The advancement of CCS 
technologies is essential if new coal power plants are to 
operate in the low-carbon future we must achieve.
    I also want to point out that when EPA determines the best 
system of emission reduction, it is actually required to 
promote the development of technology. I am sure we will hear 
much more on the state of CCS technologies from today's 
witnesses. That technology development is good for the economy 
and good for the earth.
    Last week, we debated the EPA's proposed carbon limits on 
the House Floor. Some called into question whether CCS was 
adequately demonstrated because the technology is not 
commercially available. There is a difference between the two. 
The legal requirement is ``adequately demonstrated,'' and the 
EPA has met that burden.
    Let me close by saying that I know many of my colleagues 
across the aisle are skeptical about whether humans contribute 
to climate change. But the scientists, overwhelmingly, are not. 
And my constituents are not, and indeed they are seeing the 
impacts of climate change and asking policymakers to act. This 
winter's reduced snowpack not only means a shorter ski season 
and less of an economic boost from tourism, but it means less 
water for agriculture and salmon migration this spring and 
summer. The acidity of the Pacific Ocean is increasing, putting 
Oregon's fisheries and shellfish industries at risk. Warmer 
temperatures are leading to increased outbreaks of the mountain 
pine beetle, harming the Northwest's forest industry. And 
warmer temperatures are making it more challenging to grow our 
region's famous Pinot Noir grapes, a big part of the economy in 
Oregon.
    So the impacts are real and we must do all that we can to 
mitigate the effects of climate change. The carbon dioxide we 
release now will affect generations to come. I am supportive of 
the Administration's efforts to transition the United States to 
a lower-carbon economy, and the EPA's proposed rule for new 
power plants is a critical step in that direction.
    Thank you. I yield back, Mr. Chairman.
    [The prepared statement of Ms. Bonamici follows:]

 Prepared Statement of Environment Subcommittee Ranking Member Suzanne 
                                Bonamici

    Thank you, Mr. Chairman, and thanks to the Chair of the Energy 
Subcommittee, Ms. Lummis, for holding this morning's hearing.
    Today we will discuss the performance standards proposed by the 
Environmental Protection Agency (EPA) for carbon dioxide emitted from 
new power plants. This hearing is similar to a hearing we held last 
fall, but this time we have the opportunity to hear directly from EPA 
on this important issue. I'd like to thank Acting Assistant 
Administrator Janet McCabe for being here today. I'd also like to thank 
the witnesses on our first panel for their thoughtful testimony.
    Last year, President Obama laid out his agenda to address one of 
the biggest environmental challenges of our time-climate change. A key 
component of that plan, and any effort to reduce the amount of carbon 
emitted by the United States, is the need to significantly lower the 
amount of carbon produced during electricity generation. Emissions from 
power plants represent about one-third of the greenhouse gases produced 
by the United States, and EPA's proposed rule takes an important first 
step in tackling this major source of carbon pollution.
    To emphasize--the proposed rule sets carbon limits on new power 
plants, not existing plants or those under construction. Looking at 
current and future market conditions, especially competitive natural 
gas prices, it is likely that many if not most new power plants will be 
able to meet the proposed carbon limits. It's the market, not the 
proposed rule, that is contributing to the proliferation of natural gas 
power plants over coal. In my home state of Oregon, our last coal plant 
is scheduled to be closed by 2020, and some of that generation capacity 
will be replaced with a natural gas plant.
    The proposed EPA rule will create a market incentive for the 
continued development and promotion of carbon capture and storage, or 
CCS, technologies. The advancement of CCS technologies is essential if 
new coal power plants are to operate in the low carbon future we must 
achieve. I also want to point out that when EPA determines the ``best 
system of emission reduction,'' it is actually legally required to 
promote the development of technology. I am sure we will hear much more 
on the state of CCS technologies from today's witnesses. That 
technology development is good for the economy and the earth.
    Last week, we debated the EPA's proposed carbon limits on the House 
floor. Some called into question whether CCS was ``adequately 
demonstrated'' because the technology is not commercially available. 
There is a difference between the two. The legal requirement is 
``adequately demonstrated,'' and the EPA has met that burden.
    Let me close by saying that I know many of my colleagues across the 
aisle are skeptical about whether humans contribute to climate change. 
But the scientists, overwhelmingly, are not. And my constituents are 
not, and indeed they are seeing the impacts of climate change now and 
asking policymakers to act. This winter's reduced snowpack not only 
means a shorter ski-season and less of an economic boost from tourism, 
but it means less water for agriculture and salmon migration this 
spring and summer. The acidity of the Pacific Ocean is increasing, 
putting Oregon's fisheries and shellfish industries at risk. Warmer 
temperatures are leading to increased outbreaks of the mountain pine 
beetle, harming the Northwest's forest industry. Warmer temperatures 
are making it more challenging to grow our region's famous Pinot Noir 
grapes.
    The impacts are real and we must do all that we can to mitigate the 
effects of climate change. The carbon dioxide we release now will 
affect generations to come. I am supportive of the Administration's 
efforts to transition the United States to a low carbon economy. The 
EPA's proposed rule for new power plants is a critical step in that 
direction.Thank you and I yield back.

    Chairman Schweikert. Thank you, Ms. Bonamici.
    Mr. Swalwell.
    Mr. Swalwell. Thank you, Chair, and thank you for holding 
this hearing today, and I agree with my colleague, Ms. 
Bonamici: global climate change is one of the greatest 
challenges of our time, and last September the 
Intergovernmental Panel on Climate Change released a report 
which states with 95 percent certainty that human activities 
are indeed responsible for climate change, and this report was 
based on a rigorous review of thousands of scientific papers 
published by over 800 of the world's top scientists. And this 
report makes it clear that if we don't take steps now, if we 
don't take steps today to halt what is causing climate change, 
the repercussions for humans and the environment will be 
catastrophic.
    And the problem, as I see it, is that right now too few 
recognize that this is happening. I was giving a college 
lecture just 2 nights ago, and a student asked me, well, isn't 
it that Republicans think climate change isn't happening and 
Democrats think climate change is happening and it is caused by 
mankind, and I told the student, I look at this as I would look 
at my cases when I was a prosecutor, and as a prosecutor, if I 
was proving a homicide and I had DNA evidence, I wouldn't sit 
in a witness chair and testify, I would call an expert DNA 
analyst to the witness chair and that expert, based on that 
expert's training and experience and education, would tell the 
jury that indeed the DNA evidence was present and relevant, he 
is qualified as an expert. And here as I look at it with 
climate change, it is no different. We have called in the 
experts, and the experts are Republican scientists and the 
experts are Democratic scientists, and they have reached a 
bipartisan, nonpartisan, actually, conclusion, which is that 
humans are affecting climate change, and I think the sooner we 
all agree on that, the sooner we all sing off of the same sheet 
of music, the better off we will be and the better suited we 
will be to address what we can actually do to reduce its 
impact.
    And so I have repeatedly said on this Committee that I am 
for an all-of-the-above approach to energy production as we 
transition to clean energy technologies, but I have also made 
it clear that this all-of-the-above approach we must make sure 
that we are taking steps to reduce our greenhouse gas emissions 
and lessening their impact on human health, the environment, 
and global climate.
    And so I want reinforce also that the proposed standards 
going forward are only for new plants that may be built and are 
not intended and will have no effect on existing plants, so we 
are not going to see a wave of shuttered plants and massive 
layoffs as a result of their implementation. So again, I want 
to repeat this for folks in the coal industry who rightfully 
may be fearful of what this means. These regulations from the 
EPA are for future plants, not for existing plants. And there 
are in-depth discussions underway right now about establishing 
standards for existing plants, which the EPA currently plans to 
produce in June, but there is an ongoing, extensive engagement 
with all the stakeholders to make sure that those standards 
will be flexible and won't have negative effects on state 
economies and job creation.
    So my colleagues on the other side of the aisle often talk, 
and I think for good reason, about not wanting to saddle our 
children with our national debt, and for that same reason, that 
same principle, I think we want to make sure that we do not 
saddle our children with the effects of climate change. So I am 
interested in what this hearing produces and what our witnesses 
have to say about carbon sequestration and what we can do to 
address climate change.
    And with that, I yield back.
    [The prepared statement of Mr. Swalwell follows:]

 Prepared Statement of Energy Subcommittee Ranking Member Eric Swalwell

    Thank you Chairman Stewart and Chairman Lummis for holding this 
hearing, and I also want to thank the witnesses for their testimony and 
for being here today.
    Global climate change is one of the greatest challenges that we 
face. Last September, the Intergovernmental Panel on Climate Change 
released a report which states with 95 percent certainty that human 
activities are responsible for climate change. This report was based on 
a rigorous review of thousands of scientific papers published by over 
800 of the world's top scientists. The report also makes it clear that 
if we don't take steps to halt this change, the repercussions for 
humans and the environment will be catastrophic. We now need to move 
forward and take the necessary steps to combat the warming of our 
planet before these impacts become inevitable.
    We know that humans are impacting the climate in a number of ways--
through emissions from the vehicles we drive, deforestation, and 
changes in agricultural practices among other things.But electricity 
generation is the biggest producer of greenhouse gasses, accounting for 
roughly a third of our total emissions.
    I have repeatedly said that I am for an ``all of the above'' 
approach to energy production as we transition to clean energy 
technologies. But I have also made it clear that, as part of this ``all 
of the above'' approach, we must take steps to ensure that we are 
reducing greenhouse gas emissions and lessening their impact on human 
health, the environment, and the global climate.
    That is exactly what the proposed standards for new coal and 
natural gas burning plants aim to do, which is why I support their 
implementation. And, like Ms. Bonamici, I want to reinforce that these 
are only proposed standards for any new plants that may be built and 
will have no effect on existing plants, so we aren't going to see a 
wave of shuttered plants and massive layoffs as a result of their 
implementation. There are in-depth discussions underway about 
establishing standards for existing plants, which the EPA currently 
plans to propose in June, and there is ongoing, extensive engagement 
with all stakeholders to make sure that those standards will be 
flexible and won't have negative effects on state economies and job 
creation.
    It has been my hope that Congress would act on this issue 
immediately. Unfortunately, too many of my colleagues choose to ignore 
the scientific consensus that human beings are playing a significant 
role in the warming of our planet, so I'm not expecting that much will 
be done legislatively to sufficiently address this issue anytime soon. 
The President has made it clear that, in the absence of Congressional 
action, his Administration is going to take the lead in efforts to 
reduce greenhouse gas emissions. These proposed standards reflect that 
commitment, and I fully support the President in this effort.
    My colleagues on the other side of the aisle often say that our 
children and grandchildren are going to be left holding the bag if we 
don't reduce our deficits and the national debt, and I agree that it 
would be irresponsible of us not to take serious steps to put our 
fiscal house in order. Similarly, future generations will be the ones 
who will suffer if we don't take immediate and meaningful steps to 
confront climate change, and in this case--as the global scientific 
community has made clear again and again--the consequences of our 
inaction could be far more severe.
    With that I yield back the balance of my time.

    Chairman Schweikert. Thank you, Eric--I mean, excuse me, 
Mr. Chairman--or excuse me, Ranking Member, and let us hope it 
stays that way.
    Chairwoman Lummis.
    Mrs. Lummis. Thank you Mr. Chairman. I want to congratulate 
you on your new position on the Committee, and I look forward 
to working with you through the rest of this year. Our 
Environment and Energy Subcommittee joint hearings should be 
interesting, and I am happy to have you on board.
    Last fall, the Science Committee held a similar hearing on 
the status of technology for carbon capture and storage. It was 
confirmed that CCS is not operating in any commercial-scale 
power plant in the United States and thus should not be 
considered adequately demonstrated technology under EPA's New 
Source Performance Standards.
    Today we will also discuss the transportation and storage 
of captured carbon and what viable solutions currently exist 
for industry. I look forward to the hearing and hearing from 
EPA witness as well on the storage options under the proposed 
NSPS. Is recycling carbon in enhanced oil recovery possible on 
a large scale or will untested long-term geological 
sequestration be needed?
    The EPA has implied that the rule does not need to speak to 
the issue of sequestration, that the cost and feasibly of 
carbon storage is outside the scope of their rulemaking. 
Staying silent on the last steps of the process proves the lack 
of demonstrated commercial viability.
    Instead of focusing on real solutions, the EPA assumes this 
proposed rule will result in negligible CO2 
emissions changes, quantified benefits, and costs by 2022. 
Since it effectively bans the building of new coal plants, it 
has no impact.
    The EPA is ignoring the consequences of their rulemaking to 
instead set a legal precedent for mandating unproven 
technologies. They need to go back and assess the impacts of 
this rule on non-air issues. There is no science behind the de 
facto mandated storage requirement. This is a policy of picking 
winners and losers through environmental regulations. New 
natural gas-fired units, boilers and heaters and existing plant 
standards are next. We need to see an all-of-the-above energy 
policy, not one based purely on politics.
    I look forward to hearing from this first panel of 
witnesses on the larger effects of this rulemaking to the 
energy supply chain from research to delivery. I thank you for 
joining us.
    I might also comment that in my State of Wyoming, in 
Gillette, Wyoming, the Neil Simpson coal-fired power unit will 
be shut down on March 21st, just in about 10 days. That is a 
unit that is only shutting down because of EPA regulations on 
industrial boiler MACT. The maximum obtainable control 
technologies don't exist to allow that boiler to continue 
through its remaining useful life of ten years, so it is going 
to be shut down. They are going to run it right up until the 
day that the EPA rules take effect because it is the most 
economical way to deliver affordable energy to the consumers it 
serves. It will be replaced by something more expensive. So 
rather than allowing it to continue through its useful economic 
life, it is being retired. It will be disassembled. It will be 
moved to another country. It will be reassembled and burn in 
another country. This is not sound policy.
    So I am looking forward to hearing what sound policy that 
we can derive as a result of EPA's work.
    Thank you, Mr. Chairman, and thank you, panel, for joining 
us.
    [The prepared statement of Mrs. Lummis follows:]

   Prepared Statement of Energy Subcommittee Chairman Cynthia Lummis

    Thank you Chairman Schweikert. I want to congratulate you on your 
new position on the Committee and look forward to continuing our work 
through environment and energy Subcommittee joint hearings this year.
    Last fall, the Science Committee held a similar hearing on the 
status of technology for Carbon Capture and Storage. It was confirmed 
that CCS is not operating in any commercial scale power plant in the 
U.S. and thus should not be considered adequately demonstrated 
technology under EPA's New Source Performance Standards (NSPS).
    Today we will also discuss the transportation and storage of 
captured carbon and what viable solutions currently exist for industry. 
I look forward to hearing from the EPA witness on the storage options 
under the proposed NSPS. Is recycling carbon in enhanced oil recovery 
(EOR) possible on a large scale or will untested long-term geological 
sequestration be needed?
    The EPA has implied that the rule does not need to speak to the 
issue of sequestration--that the cost and feasibly of carbon storage is 
outside the scope of their rulemaking. Staying silent on the last steps 
of the process proves the lack of demonstrated commercial viability.
    Instead of focusing or real solutions, the EPA assumes ``this 
proposed rule will result in negligible CO2 emissions changes, 
quantified benefits, and costs by 2022.'' Since it effectively bans the 
building of new coal plants, it has no impact.
    The EPA is ignoring the consequences of their rulemaking to instead 
set a legal precedent for mandating unproven technologies. They need to 
go back and assess the impacts of this rule on non-air issues--there is 
no science behind the ``de facto'' mandated storage requirement.
    This is a policy of picking winners and losers through 
environmental regulations. New natural gas fired units, boilers and 
heaters and existing plant standards are next. We need to see an all-
of-the-above energy policy, not one based purely on politics.
    I look forward to hearing from this first panel of witnesses on the 
larger effects of this rulemaking to the energy supply chain--from 
research to delivery. Thank you for joining us.

    Chairman Schweikert. Thank you, Chairwoman Lummis.
    If any of the Members wish to submit additional opening 
statements, your statements will be added to the record at this 
point, and I believe you can do that for--in this Committee, it 
is seven days? Or two weeks. to be able to add an opening 
statement.
    [The prepared statement of Ms. Johnson follows:]

   Prepared Statement of Full Committee Ranking Member Eddie Bernice 
                                Johnson

    Thank you Mr. Chairman. I am pleased that we will be able to hear 
testimony on this very important topic, and I want to thank the 
witnesses for appearing before us today.
    Our climate is changing. These changes are resulting in more 
extreme weather, rising sea levels, and altered food webs. We must 
accept these new climate realities and be open to solutions if we are 
at all serious about protecting the health of American families. So I 
am happy to join my colleagues Ms. Bonamici and Mr. Swalwell in 
expressing my approval of the steps being taken by the Administration 
and by EPA, to advance clean energy technologies and protect future 
generations from the harmful effects of carbon pollution.
    Throughout history industry has often resisted addressing 
environmental problems that emerge from a greater scientific 
understanding of how human activities impact the environment and our 
health. And in many of these cases, industry simply refuses to act 
without regulatory intervention and proper government oversight. The 
technology which we are discussing today, carbon capture and storage, 
or CCS technology, is an example of the type of innovative solutions 
that will not be implemented without a regulatory incentive to lower 
the amount carbon being emitted.
    I, like many of my colleagues, wish that Congress would enact 
legislation to address climate change. Unfortunately, the current 
political realities will not allow us to act. So I say let us not stand 
in the way of EPA and necessary change. Let the Administration continue 
to move us forward, so that the U.S. can be a leader and we as 
Americans can do what we always do--rise to the challenge and move with 
great purpose to solve this crisis. I challenge industry to be leaders, 
and be a helpful partner in reducing our carbon emissions going 
forward.
    I look forward to the testimony of our witnesses. Thank you again, 
and I yield back the balance of my time.

    Chairman Schweikert. Having read all of your statements, 
you are all very, very bright and you are very smart. I will 
beg of you as we go through this hearing, I see this is a 
technical hearing, help us raise our level of technical 
understanding of this technology. And so instead it is less 
policy, it is more math and science, shall we say.
    Our first witness is David Hawkins, Director of Climate 
Change Programs at the Natural Resource Defense Council. He 
joined NRDC in 1971 as one of the organizers' first staff 
members. In 1977, Mr. Hawkins was appointed to be the Assistant 
Administrator for Air, Noise and Radiation at EPA under the 
Carter Administration. In 1981, he returned to NRDC's Air and 
Energy Program, and in 2000 became director for NRDC's Climate 
Center. Instead of introducing everyone at once, I thought we 
will introduce each person as they get ready.
    Mr. Hawkins, five minutes. And you know the routine: yellow 
light; talk faster.

                  TESTIMONY OF DAVID HAWKINS,

              DIRECTOR OF CLIMATE CHANGE PROGRAMS,

               NATURAL RESOURCES DEFENSE COUNCIL

    Mr. Hawkins. Thank you very much for inviting me to testify 
on behalf of NRDC. Several points I would like to make.
    First, as numerous scientific and industrial organizations 
have concluded, we have to act with urgency to bring low-carbon 
electricity resources to market. We can't protect the climate 
without them.
    Second, the Clean Air Act, passed by a bipartisan vote and 
signed by President Nixon, calls on EPA to set standards for 
pollutants like CO2 that present a danger to health 
and welfare. Now, Congress did not give EPA free rein in 
setting these standards but it did not tie EPA's hands either.
    The Act sets sensible limits on EPA's authority for these 
standards. First, EPA must show that the technology is 
available that could be applied to meet the proposed standards, 
and second, it must show that the cost of meeting those 
standards is reasonable. The EPA proposal is on solid ground 
legally and technically in the standards for new coal plants 
that it has proposed based on the capability of carbon capture 
and storage, or CCS, because in writing the Act, you did not 
require that EPA must point to a technology that is already in 
use in the regulated industry. To have done so would have been 
to put the polluters in charge of deciding whether they would 
ever have to clean up. Instead, the law directs EPA to survey 
approaches that can work in a given sector, even if there is 
little or no current use of those approaches in the category 
that is being regulated, and that is a commonsense approach.
    As my testimony details, carbon capture and storage is 
proven technology at industrial scale with decades of 
experience for each of the component processes. Even without a 
standard in place, there are several vendors who are already 
offering commercial carbon capture systems and pipeline 
transport and geologic storage of CO2 is fully 
commercial. EPA in its record has established a substantial 
body of evidence to support its technology conclusions, and the 
courts will review those conclusions when they consider 
challenges to the rule.
    Turning to costs, EPA conducted a comprehensive analysis 
using Department of Energy research and concluded that the cost 
of making electricity at a new coal plant with CCS would fall 
in the range of the costs for new nuclear or biomass energy 
plants. Now, compared to production costs of a new coal plant 
with CCS to a new coal plant without CCS, the costs of the 
plant with CCS as EPA found would be about 20 percent higher, 
and that is without considering any revenues for enhanced oil 
recovery. But customer rate impacts would be much less than 20 
percent, and that is because the cost of any given single unit 
is diluted by being folded into the rate base for that system.
    Now, some in the coal industry and some owners of coal 
plants are lobbying Congress to intervene and try to block 
EPA's standards. This would be profoundly bad policy. If we 
prevent EPA from setting sound standards, that will not allow 
us to escape the threat of climate disruption. That will 
continue no matter what laws Congress tries to enact. Instead, 
it would perpetuate uncertainty about what investments should 
be made in the power sector. Investors who are asked to commit 
billions of dollars to a new power plant will not believe that 
a Congressional bar on action by EPA, in the very unlikely 
event that such legislation were signed into law, will be a 
stable basis for making those billions of dollars of 
investments. New coal plants take ten years to build and 
another 15 or 20 years to earn their investment back in the 
best of times, and if you believe that there are investors out 
there that are willing to take the risk that no limits on 
carbon pollution will be forthcoming during that long period of 
time, I suggest you hold another hearing and invite them to 
testify.
    My advice to Members of Congress who are genuinely 
interested in creating space for coal to play a continuing role 
in the American economy would be to reject these efforts to 
hamstring EPA and instead support efforts that could enjoy 
bipartisan support to provide financial incentives for CCS used 
for enhanced oil recovery, for example. NRDC is on record 
supporting those kinds of initiatives, and we would be happy to 
work with Members that are interested in pursuing that approach 
to this important problem.
    Thank you very much.
    [The prepared statement of Mr. Hawkins follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

       
    Chairman Schweikert. Thank you for that.
    Today's second witness is Mr. Robert Hilton, Vice President 
of Power Technologies for Government Affairs at Alstom Power, 
Inc. Mr. Hilton has been in the air pollution control field for 
over 30 years. In his current role, Mr. Hilton provides 
information and technical data on power technology to state and 
federal regulators. He holds 15 U.S. and foreign patents and 
has authored numerous technical publications.
    Mr. Hilton, five minutes.

         TESTIMONY OF ROBERT G. HILTON, VICE PRESIDENT,

           POWER TECHNOLOGIES FOR GOVERNMENT AFFAIRS,

                       ALSTOM POWER INC.

    Mr. Hilton. Good morning. I would like to thank the 
Chairman and the Chairwoman and the Ranking Member the 
opportunity to present this testimony.
    Alstom is a global leader in the world of power generation, 
transmission and transportation infrastructure. We are a leader 
in the field of carbon capture, having completed work on four 
pilots and 10 pilot, validation and commercial-scale plants 
that are in operation, design and construction. These projects 
include both coal and gas.
    It is critical to be at commercial scale to define the risk 
of offering the technology. This will define contractual 
conditions and standard commercial terms including multiple 
performance guarantees, reliability, availability and other 
contractual guarantees.
    Finally, our customers would be reluctant to invest in 
carbon capture technologies that have not been demonstrated at 
full commercial scale. Based on these criteria, Alstom does not 
currently deem its technologies commercial, and to my 
knowledge, no one else is willing to offer this full suite of 
guarantees. I emphasize, however, that the technologies being 
developed by Alstom and others work.
    Let us take a look at the Clean Air Act criteria for best 
system of emission reduction. As proposed by EPA, feasibility, 
looking at the projects they cited, Kemper is under 
construction and not demonstrated. Sask is under construction 
and not demonstrated. Summit, HECA, Parish haven't even started 
construction. AEP Mountaineer was only 2.3 percent of the plant 
gas stream and does not qualify as significant. Dakota 
Gasification is producer of natural gas and fertilizer plant 
and not a power plant. Four of the six projects are gasifiers 
and high-pressure technology not suited to pulverized coal or 
natural gas combined cycle plants, which are atmospheric 
pressure, which really represent 95 percent or more of the 
fleet. These atmospheric technologies are not operating at 
significant scale at any site.
    Cost--Alstom cannot comment in detail on the status of 
projects proposed by other companies, but based on facts in the 
public domain, I am aware of no CCS projects that would be 
considered cost-competitive in today's energy economy. The five 
capture and sequestration projects cited in NSPS proposal all 
rely on either EOR or byproduct revenues and/or federal 
subsidies. EPA should consider the typical power plant, which 
will not have federal subsidies and will not likely have access 
to chemical and EOR revenues. EPA needs to recognize that both 
chemicals and EOR are niche opportunities.
    Then next comes the size of CO2 reductions. EPA 
admits in its rule that it will not achieve significant 
reductions; in fact, it will simply slow the rate of 
acceleration.
    As far as technology goes, this regulation will essentially 
stop the development of CCS since the proposed regulation 
provides a significantly lower cost alternative, natural gas, 
to the application of CCS on coal. There is unlikely to be a 
market for at least ten years. Industry-based R&D based on 
return on investment will stop. One only needs to look at the 
slowing pace already reported by the GCCSI.
    We differ with EPA on the notion that NSP regulations will 
spur development. Let us really look at the industry has done 
for the Clean Air Act. When they wanted to do particulate 
matter, the EPA had been--rather, industry had been doing 
precipitators and collectors since the 1920s. When they went to 
do sulfur dioxide, the first full-scale scrubbers were built in 
1942. I personally worked on one in 1970. When the NOX SIP call 
came in 1999, we had been doing reduction technologies since 
the 1980s. When mercury came in 2010, the industry had been 
deploying these since the mid-1980s, and in this case, we 
actually worked with EPA to revise the rule.
    NSPS is different. The issue we are now faced with is that 
industry did not in earnest begin work on CO2 from 
atmospheric gases until the early 2000s. The technology is not 
fully developed and the regulation proposed is ahead of the 
technology. It should be noted that this is a larger, more 
complex and technically sophisticated technology compared to 
any of the others in the Clean Air Act.
    With no new power generation being built, it is our view 
that this presents a real threat to the U.S. economy both in 
terms of employment and the industries that build and supply 
coal plants as well as the mining, transportation and 
maintaining the necessary technology leadership. The true state 
of the technology on conventional power plants is that today 
there have been a handful of small demos such as AEP's 
Mountaineer and Southern Company's Plant Barry on coal. There 
are two small pilots in Mongstad, Norway, on gas. EPA indicates 
it has done literature searches and reviews of other sources of 
information to determine all the components are available. 
However, an important point that EPA misses is that the true 
risk and the complex multistage process is in the integration 
of all of the processes.
    Let me make just a couple of quick points on that. How does 
the capture process respond with generation load? How does it 
respond when it is slaved to the unit? There are others that I 
could go on and on technically. I also would point out that DOE 
has developed a comprehensive roadmap and timeline for the 
commercialization of CCS technologies, which points to general 
deployment in the 2020s. We would encourage EPA to look at 
that.
    Finally, it is the issue of cost, and we do not believe in 
this market and our experience shows us that the public utility 
commissions, the regulators are trying to maintain lowest cost 
of electricity to ratepayers. It is highly unlikely that they 
are going to approve the development and/or deployment of CCS 
with coal when they can do it much cheaper with a natural gas 
plant.
    Thank you.
    [The prepared statement of Mr. Hilton follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

        
    Chairman Schweikert. Thank you, Mr. Hilton.
    Our third witness is Mr. Robert Trautz, Senior Technical 
Leader at the Electrical Power Research Institute. He has over 
30 years of experience in research and applied geology and 
hydrology involving CO2 storage. In his current 
capacity, Mr. Trautz manages demonstration projects funded by 
the Department of Energy, EPRI and other industry groups. Mr. 
Trautz has previously worked at Lawrence Berkley National 
Laboratory and the U.S. Geological Survey.
    Mr. Trautz, five minutes.

                 TESTIMONY OF ROBERT C. TRAUTZ,

                    SENIOR PROJECT MANAGER,

               ELECTRIC POWER RESEARCH INSTITUTE

    Mr. Trautz. Thank you very much, Mr. Chairman.
    My name is Robert C. Trautz. I am a Senior Technical Leader 
at the Electric Power Research Institute. EPRI conducts 
research related to the generation, delivery and use of 
electricity for the benefit of the public. EPRI is working with 
the Southern States Energy Board within the Southeast Regional 
Carbon Sequestration Partnership program to assess CO2 
storage opportunities in the southeastern United States. My 
testimony reflects the independent views of EPRI and isn't 
defined by SSEB or SECARB.
    At the heart of the proposed New Source Performance 
Standard is a mandatory reduction in CO2 emission 
intensity using CCS technology that will require coal-fired 
power units to reduce CO2 emissions to less than 
1,100 pounds per megawatt-hour gross. To place EPA's emissions 
limit in perspective, the amount of CO2 that will 
need to be stored to meet the limit is approximately 40 percent 
of the CO2 output from a pulverized-coal plant. For 
a moderate-sized, 1,000-megawatt plant, this equates to about 
3.1 million tons per year. Over a 40-year lifespan, for this 
example, the plant will need to store over 120 million metric 
tons of CO2.
    To understand the significance of storing this quantity of 
CO2, I offer the following storage example for 
illustrative purposes only. Using the Lower Tuscaloosa 
Sandstone located within the Gulf Coast region of the United 
States, injection of 120 million tons of CO2 into 
this regionally extensive saline reservoir would create a 
CO2 plume with a subsurface area of several square 
miles. This example illustrates the importance of 
characterizing and utilizing large regional reservoirs for 
CO2 storage due to the very large quantities of 
CO2 that we are talking about for multiple plants.
    The U.S. Department of Energy estimates there are 
approximately 226 billion metric tons of CO2 storage 
capacity in depleted oil and gas reservoirs and up to 20 
thousand billion metric tons in saline formations in the United 
States and Canada. The stark contrast in these storage 
estimates reflects the widespread distribution and importance 
of saline reservoirs. The potential use of depleted oil and gas 
reservoirs for CO2 storage could be adversely 
affected by potential regulatory requirements associated with 
CO2 storage. Preliminary feedback from oil producers 
indicates that a requirement for EOR operators to monitor and 
certify CO2 storage under subpart RR of the EPA's 
mandatory greenhouse gas reporting requirements could be a risk 
that many companies may not be willing to take. Thus, such 
requirements may have the unintended consequence of 
discouraging the use of depleted oil and gas reservoirs. The 
limited geographic distribution and storage capacity of these 
reservoirs in any case will eventually limit their long-term 
use. One of the benefits of using depleted oil and gas 
reservoirs for CO2 storage is the wealth of geologic 
knowledge available for these reservoirs. In contrast, little 
is known about saline reservoirs because they currently have 
little to no economic value. To date, there are only three 
large-scale saline storage projects in the world that have or 
are currently injecting CO2 at a rate approaching 1 
million metric tons per year. It is important to note that 
these projects involve CO2 separation from natural 
gas and store an annual amount equal to about a third of the 
CO2 from a single 1,000-megawatt power plant. From a 
geologic storage perspective, these projects are very important 
for the following reasons.
    The Sleipner Project in the North Sea is the flagship of 
the global CO2 saline storage project injecting 
CO2 at a sustained rate of 1 million metric tons per 
year for nearly 20 years. The Snohvit Project in the Barents 
Sea is injecting at a rate of 820,000 metric tons per year. 
Initially, however, this project found that the formation 
permeability was too low and pressures climbed rapidly, 
requiring injection into a different zone. The In Salah Project 
in central Algeria suspended CO2 injection in 2011 
after monitoring data indicated that the lower caprock above 
the storage reservoir had likely fractured due to injection.
    The projects illustrate the risks and geologic uncertainty 
associated with selecting a saline storage site. They also 
illustrate the need to gain experience at scales commensurate 
with full-scale commercial power projects. The DOE's field 
demonstration projects are invaluable because of their ever-
increasing storage scale. However, given that the NSPS is 
clearly focused on reducing emissions from fossil fuel-fired 
plants, further government investment in research is needed 
that integrates power projects with capture and saline storage 
at full scale. Only two of the DOE demonstration projects 
fielded to date have included small-scale capture and saline 
storage on coal-fired units of less than 100,000 tons each, and 
only one large-scale, million-ton-per-year saline injection 
project is currently planned.
    In addition, given that more is known about oil and natural 
gas reservoirs, future storage research and funding may need to 
focus more on saline reservoirs to help close the knowledge 
gap.
    Thank you for the opportunity to testify before you today, 
and I welcome your questions.
    [The prepared statement of Mr. Trautz follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Chairman Schweikert. Our fourth witness today is Scott 
Miller, General Manager and CEO of City Utilities of 
Springfield, Missouri, a member of the American Public Power 
Association. Mr. Miller joined the City Utilities in 2002 as 
the Associate General Manager for Electrical Supply and was 
named General Manager and CEO in 2011. Mr. Miller also serves 
on the board of directors of the American Public Power 
Association and the Missouri Joint Municipal Electric Utility 
Commission. He has 27 years of experience in the utility 
industry.
    Mr. Miller, five minutes.

                   TESTIMONY OF SCOTT MILLER,

                    GENERAL MANAGER AND CEO,

            CITY UTILITIES OF SPRINGFIELD MISSOURI,

               AMERICAN PUBLIC POWER ASSOCIATION

    Mr. Miller. Thank you, Mr. Chair.
    I have been in the industry 27 years. I represent City 
Utilities of Springfield. We are a municipal utility. We offer 
electric, natural gas, water, broadband and transit services to 
the Springfield area. We have over 1,100 megawatts of 
generation and we serve over 220,000 customers. I am also a 
member of the board of directors at APPA, and we represent the 
interests of over 2,000 community-owned utilities, not-for-
profit utilities, that provide services to over 47 million 
Americans. We provide locally controlled, low-cost, reliable, 
efficient and environmentally responsible energy.
    The public power utilities are concerned about the 
potential for likely impacts the EPA regulating greenhouse gas 
emissions from new power plants by establishing New Source 
Performance standards under the Clean Air Act. In particular, 
public power utilities strongly disagree with EPA's conclusion 
that carbon capture and storage is the best system of emission 
reduction, or BSER, for reducing CO2 emissions. The 
conclusion is premature, given that there are no commercially 
operating coal plants using this technology, and the agency's 
failure to address the variety of regulatory hurdles that are 
impeding sequestration and CO2 in the United States.
    City Utilities was recently involved with a carbon 
sequestration project within our state. Our experience 
highlights some of the issues that would be addressed before 
CCS could be deemed as adequately demonstrated. In 2005, we got 
together with the generating utilities across the state to 
determine what were we going to do if carbon emissions were 
regulated. At the time, over 70 percent of our generation came 
from coal-fired generation. Much of the research that we had 
seen did not address shallow sequestration issues that we would 
have had for geologic formations within our state. In 2008, 
City Utilities received $4.7 million of federal funding 
administered through DOE so that we could do the Missouri 
Shallow Carbon Sequestration Project. City Utilities with 
Kansas City Power and Light, the Empire District Electric, 
Ameren Missouri, and Associated Electric Cooperative also 
matched funds of $1.2 million, so we had our customers' money 
involved with the project. The project's purpose was to 
evaluate the feasibility of onsite sequestration at the power 
plants. The project targeted sandstone formations that were 
approximately 2,000 to 3,500 feet, which mean that we would be 
injecting in a gas phase as opposed to the liquid or 
supercritical phase. The original plan targeted saline 
aquifers, which we just heard about, and small injections of 
food-grade CO2 to see how that would be encapsulated 
within the formation. Our research was conducted by Missouri 
State University, Missouri University of Science and 
Technology, and our DNR within the state.
    The John Twitty Energy Center at City Utilities was the 
primary site. The drilling was conducted and we reached the 
Precambrian level at about 2,200 feet, but we were not allowed 
to inject because what we found was the water quality in that 
area was potable. We were expecting saline and it was potable 
water. So federal regulations stopped us from injecting at that 
point. We had to change our project, and we decided to go to 
other sites within the state in the northwest, north central 
and near the St. Louis area so that we could determine if they 
were actually saline aquifers in a shallow formation within our 
state.
    In summary, we spent about $5.8 million for the testing. We 
found one area of the state that has now been eliminated 
because of the quality of the water. We have two others that we 
have identified in the state that we believe are acceptable, 
and we were also able to identify three areas where the 
confining layer looked to be a positive where it would confine 
the CO2 within the aquifer. However, we were not 
allowed or were not able to complete our pressure testing or 
aquifer permeability because of cost limitations, so we were 
not able to substantiate through CO2 injections that 
we had the ability for long-term storage within our state.
    Based upon the results of this project and others that we 
have seen across the United States and across the world, CCS 
technology is not really a realistic option for utilities 
seeking to reduce their CO2 emissions in the near 
future. As a CEO of a municipal utility, one of my 
responsibilities is to our city and our customers, that if we 
are going to spend their money, we need to know that it is 
going to go towards something that will function for them, and 
we do not have a high degree of confidence that CCS will do 
that for us.
    In looking at all the CCS research that is out there, it 
appears there is no factual basis that EPA may assert that 
carbon sequestration technology has met the Clean Air Act's 
three-part test, which is the technology needs to be adequately 
demonstrated, it needs to be widely available and it needs to 
be shown to be technically and economically feasible, and we 
don't believe that that is out there.
    Thank you.
    [The prepared statement of Mr. Miller follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
    
    Chairman Schweikert. Thank you, Mr. Miller.
    As all of you know, your written testimonies are being made 
now part of the record. I am going to turn to Chairwoman Lummis 
for the first five minutes of questions.
    Mrs. Lummis. Thank you, Mr. Chairman.
    First, I would like to ask all of our panelists for a show 
of hands, how many of you live on $1,226 a month right now? The 
record reflects that none of you raised your hands.
    Let me tell you about this woman who was written about in 
the day before yesterday's New York Times, and Mr. Chairman, I 
would like to without objection submit the New York Times 
article ``Coal to the Rescue but Maybe Not Next Winter'' to the 
record.
    Chairman Schweikert. Any objections on either of those? 
None heard.
    Mrs. Lummis. Thank you.
    [The information appears in Appendix II]
    Mrs. Lummis. Well, let me tell you about this article. This 
woman had on her $1,200-a-month income her utility bills go up 
$100 just in one month. This article by Matthew L. Wald states 
that ``At the end of the harshest winter in recent memory, the 
bill is coming due for millions of consumers who are not only 
using more electricity and natural gas but also paying more for 
whatever they use, and there might not be relief in future 
winters as the coal-fired power plants that utilities have 
relied on to meet the surge in demand are shuttered for 
environmental reasons.''
    Question, Mr. Miller. If the Nation's existing coal 
capacity cannot be replaced due to EPA's proposed New Source 
Performance Standards rule, where will you turn for new 
generation?
    Mr. Miller. We don't have a lot of options. I mean, coal is 
a foundation within our state. We would have to look to natural 
gas and we would have to look to purchases on the market, which 
would rely on mostly natural gas generation that would be 
coming online. The issue that we saw this winter is that we 
don't have the infrastructure for the natural gas for power 
generation at the same time that we are trying to make sure 
that people's homes stay warm. So when you have those in 
competition recently during the cold spell, we had to curtail 
our natural gas generation so that we had enough gas for people 
to heat their homes. So obviously it has a huge impact, and we 
have seen that push the price of natural gas up. So in general, 
I am not sure we have the natural gas infrastructure to support 
the transition from coal to other generation that is out there, 
and we have the same issue that you have--that was in that 
article. We have 22 percent of our customers that are living at 
the poverty level, so any time that you have additional costs 
implied through regulations, it goes right to their bottom 
line, and they are trying to figure out how to pay their bills.
    Mrs. Lummis. Thank you.
    Mr. Trautz, your testimony states that the new subpart RR 
requirements in the proposed rule could be a risk that EOR 
companies are not willing to accept. Where does this leave a 
power provider looking to invest in coal or natural gas if the 
EPA decides to require CCS for gas?
    Mr. Trautz. So for--the only thing that they would probably 
turn to is to saline reservoirs because those are broadly 
distributed and probably much closer to where the power plant 
is located, so they would turn to those reservoirs, which I 
indicated in my testimony, we know--we don't know as much about 
those reservoirs as we do the EOR fields.
    Mrs. Lummis. So there is no good demonstration of the 
efficacy of saline reservoirs for storage?
    Mr. Trautz. Well, we have the Sleipner Project, which I 
mentioned in my testimony, that's on a natural gas separation 
but we currently do not have a full-scale project that is 
planned for saline storage. That would be an integrated project 
with a power plant.
    Mrs. Lummis. Mr. Hilton, can you expand on your statement 
that NSPS hurt the development of CCS?
    Mr. Hilton. It is fairly simple. I mean, all of R&D is 
driven by what the market demands, and if there is no demand 
for CCS on gas and there is only on coal and coal is not built 
as a result of that, it becomes a decision, does industry 
continue to invest because we are already seeing frankly that 
DOE has run out of money to invest in it. They don't have any 
large funds available. So it is up to the individual companies 
whether they want to continue to invest, and 10 or more years 
of waiting for a market is a long time.
    Mrs. Lummis. Can you also discuss the importance of 
commercial guarantees and the commercial deployment of CCS?
    Mr. Hilton. Yeah, everything we do--our industry has been 
incredibly successful and has lulled us all into the fact that 
there is all the power in the world that we ever want, and so 
as suppliers to that industry, we are expected to meet not just 
performance, and there are multiple performance guarantees on 
energy, on additives, on--there is also availability and 
liability guarantees with this equipment, and those come into 
potentially billions of dollars of liability. And that is why 
we need to have this demonstrated, to know that the integration 
works because there is no one that is going to accept that 
billions of dollars of liability otherwise.
    Mrs. Lummis. Thank you, gentlemen.
    I yield back, Mr. Chairman.
    Chairman Schweikert. Thank you, Cynthia--Chairwoman Lummis.
    Ranking Member Bonamici.
    Ms. Bonamici. Thank you, Mr. Chairman.
    Mr. Hawkins, thank you for bringing your years of expertise 
to the Committee. On your testimony, you talk about how 
regulation has led to the development of technology. I think we 
are talking about a chicken-and-egg thing here. You note that 
CCS systems like sulfur scrubbers, mercury controls, fine 
particulate controls, nitrogen oxide controls, for example, 
were not used until they were regulatory requirements to 
control those pollutants. So I want to talk just a little bit 
about how the legislative history of the Clean Air Act supports 
the EPA's proposed rule on new power plants, and it is my 
understanding that the Senate committee that crafted Section 
111 stated that the section was designed to promote constant 
improvement in techniques for preventing and controlling 
emission from stationary sources and an emerging technology 
used as the basis for standards of performance need not be in 
actual routine use somewhere. So can you please discuss how EPA 
regulation has in the past led to the development of critical 
environmental technology?
    Mr. Hawkins. Yes, ma'am. The regulation as a driver of 
technology is well documented both in academic literature--I am 
thinking of reports by Ed Rubin of Carnegie Mellon University. 
The fact is that in the power sector in particular, it is a 
very competitive sector in terms of the hours of operation of 
individual power plants. So a power plant that has a 
fractionally higher cost of electricity production is not going 
to run as much, and that is going to lose money or not earn as 
much money for the owner of that power plant. So power plant 
operators are extremely reluctant to do anything that has the 
slightly increase, even if it would be invisible in the 
customer's bill because it determines the hours of operation 
and what is called the dispatch order of that power plant.
    So regulation or money are the essential ingredients to 
make advances, and if you don't have money, then you need 
standards, and that is why the Nixon Administration proposed 
what became the New Source Performance Standard in the 1970 
Clean Air Act to advance technology deployment in new sources 
of air pollution, and the power sector is an excellent example 
of how that has worked very well. The coal industry and the 
power industry tout in ads how much of a reduction in the 
conventional pollution has been achieved at the power sector, 
and they are correct. What they don't say is it all came about 
because of regulation. It came out because of regulation 
requiring scrubbers, it came about because of regulation 
requiring bag houses for particulate matter, it came about for 
regulation requiring nitrogen oxide controls, and most 
recently, mercury and other toxin controls, and the same 
process will happen as we turn to carbon dioxide. Carbon 
dioxide is just another chemical. There are industrial 
processes for separating it just as there have been for 
conventional pollutants, and the sooner we get on with it, the 
better off we will all be.
    Ms. Bonamici. Thank you. And I wanted to ask you also, Mr. 
Hawkins, to follow up on the discussion that we have been 
having about the research that has been done to be able to 
determine appropriate locations for carbon storage. Could you 
please respond to some of the comments that have been made 
about whether there are appropriate locations for storage?
    Mr. Hawkins. Yes. President George W. Bush's Administration 
began what has been a comprehensive approach to surveying the 
site availability for geologic storage. And fortunately, the 
United States is blessed with huge amounts of the geologic 
formations that are appropriate for storage of CO2. 
Essentially you need--as Dr. Trautz has indicated, you need a 
porous formation that is sufficiently below the surface of the 
earth to keep the injectant pressurized, and then on top of 
that, you need a permeable formation, and we have done surveys 
of the extent of these types of formations in the United 
States, and we have huge volumes of them, enough for more than 
100 years of all current power plant emissions as was----
    Ms. Bonamici. I want to get one more quick question in to 
you, Mr. Hawkins. How much will the proposed CCS reduce carbon 
emissions if you compare a plant with CCS and compare a plant 
without it?
    Mr. Hawkins. If you compare it with and without, it would 
be about a 50 to 60 percent reduction in that power plant's 
carbon dioxide emissions, and that is a very substantial 
emission reduction and one that would demonstrate world 
leadership and provide a market for U.S. manufacturers as this 
technology was deployed.
    Ms. Bonamici. Thank you. I see my time has expired. I yield 
back. Thank you, Mr. Chairman.
    Chairman Schweikert. Thank you, Ms. Bonamici.
    Mr. Miller. Mr. Chairman, may I respond to that first 
question?
    Chairman Schweikert. Actually, as we work our way around, 
we will get there, and I appreciate some of the technical 
responses. Actually, I am going to give myself a few minutes 
here and just sort of do a little bit of digging, because I 
wanted to try to get my head around some of the mechanics.
    And you corrected me before. Is it Trout?
    Mr. Trautz. It is Trautz, like the fish, spelled different.
    Chairman Schweikert. That is not spelled like it. You need 
to change your name and spell it the right way.
    Mr. Trautz. It is the German spelling. Sorry.
    Chairman Schweikert. In the notes on the mechanics that 
have been given to me, my understanding is, not too long ago in 
front of the Science Advisory Board at the EPA, there was a 
discussion that the sequestration of ACO2 just had 
to sort of demonstrate the adequacy and the achievability. But 
yet, you know, I am being sent letters, and here is one from 
the American Water Works Association, and without objection, I 
would like to put it into the record. No objections? Oh, good. 
Because I always hate to object to myself. I will put that in.
    [The information appears in Appendix II]
    Chairman Schweikert. And part of the question they are on 
is saying do we really have enough data of our threat to 
potable water supplies, and we heard Mr. Miller talk about his 
experience in his state where they thought they had a saline 
level and it turns out it did not work. Do we have a robust 
literature that says what our threats are and what they are not 
to potable water supplies?
    Mr. Trautz. So the answer to the question, there have been 
a number of research studies that have looked at CO2 
and the potential impact if it were to leak out of a reservoir, 
what the potential impact would be on potable groundwater.
    Chairman Schweikert. Can you answer this too? Tell me the 
nature of the studies
    Mr. Trautz. One of the studies EPRI performed, it was a 
field study where we actually introduced CO2 in the 
dissolved phase and groundwater into a potable reservoir and 
looked at the impact.
    Chairman Schweikert. And what scale was that done at?
    Mr. Trautz. It is a very small scale. It just was there to 
simulate hypothetical release of CO2.
    Chairman Schweikert. And when you are doing that sort of 
study, and this is just me sort of getting myself technically 
up to speed, you use actually human--I guess the term is food-
quality, food-grade CO2?
    Mr. Trautz. Yes, food-grade CO2.
    Chairman Schweikert. As part of your test mechanism?
    Mr. Trautz. That is correct.
    Chairman Schweikert. And what were the conclusions? What 
did the model tell you?
    Mr. Trautz. So what happened was the CO2 as it 
dissolves in the groundwater, it lowers the pH, and the pH can 
then start to dissolve mineral phases that are in the aquifer 
materials themselves and it can release heavy metals. It can 
also release heavy metals from the disassociation or the 
surface complexes that are on clays and other minerals. It can 
dissolve and come off of those surfaces and into solution, so 
heavy metal contamination is one of the biggest issues.
    Chairman Schweikert. Mr. Trautz, let us say you and I 
tomorrow were building a modern power generation facility that 
was using coal. How much CO2 would it produce for 
this model? Because you were telling me in northern Europe we 
have a couple projects that have been up and running for a 
while but they max out at about a million.
    Mr. Trautz. A million tons per year, yes.
    Chairman Schweikert. And that is metric tons?
    Mr. Trautz. Metric tons, yes.
    Chairman Schweikert. What would a modern facility produce?
    Mr. Trautz. Again, a 1,000-megawatt power plant, a 
pulverized-coal plant, would produce about 3.1 million metric 
tons per year and over a lifespan of 40 years, the example 
given in the testimony was 120 million metric tons.
    Chairman Schweikert. And do we have models that would say 
we even have places to do such storage that we would be safe 
and comfortable and long after the shutting down of such a 
facility we would have no fissures or other----
    Mr. Trautz. Yes, we do have geomechanical models that can 
be used to predict the behavior of pressurizing a reservoir, so 
those are available.
    Chairman Schweikert. And then to move on beyond the models, 
what demonstration projects do we have at scale?
    Mr. Trautz. As I mentioned in my testimony, on saline 
reservoirs only, the two that we have is the Mountaineer 
Project. That was about 37,000 metric tons total. And then 
there's Plant Barry, which is part of the SECARB Project, which 
EPRI is part of, and that is a little over 100,000 metric tons 
at this point.
    Chairman Schweikert. Okay. So in many ways, our 
demonstrations are still sort of fractional in scale?
    Mr. Trautz. They are very, very fractional, yes.
    Chairman Schweikert. Okay. If I were to look around the 
world, you are telling me right now that the largest scale we 
have is at a million metric tons, and that is a million metric 
tons on an annual basis?
    Mr. Trautz. That is correct.
    Chairman Schweikert. And for how many years?
    Mr. Trautz. The Sleipner Project has been going on since 
1996, so almost 20 years. It is the longest experience. The 
Snohvit Project has started up in 2008. The In Salah Project 
started up in 2008 and shut down or was suspended in 2011. We 
have one other large CO2 project that is coming 
online that will also be a gas separation project, and that is 
the Gorgon Project in northwestern Australia. That will be on 
the order of a power plant.
    Chairman Schweikert. Okay. So that we actually will have 
some demonstration coming on a large scale?
    Mr. Trautz. On natural gas, yes.
    Chairman Schweikert. Why was the one shut down in North 
Africa?
    Mr. Trautz. Because the CO2 pressure was too 
high and it ended up fracturing the lower part of the cap.
    Chairman Schweikert. And their models didn't predict that?
    Mr. Trautz. No, apparently not.
    Chairman Schweikert. Okay. All right. I am actually 
somewhat over my own time, so I am going to yield to Mr. 
Swalwell.
    Mr. Swalwell. Thank you, and Mr. Chair, I am moving left. I 
was over there, I am here, and by the end of the hearing I will 
be right here.
    I just want to start by asking our witnesses just a yes or 
no, and I will go down the line and start with Mr. Hawkins. Do 
you agree with the 97 percent of the scientists who say with 95 
percent certainty that climate change is happening as a result 
of activity by humans? Mr. Hawkins?
    Mr. Hawkins. Yes.
    Mr. Swalwell. Mr. Hilton?
    Mr. Hilton. Yes.
    Mr. Swalwell. Mr. Trautz?
    Mr. Trautz. Yes.
    Mr. Swalwell. Mr. Miller?
    Mr. Miller. I am not a scientist to say yes or no on that.
    Mr. Swalwell. Okay. So I want to start, Mr. Hilton, you 
stated that you had concerns that DOE is out of money and does 
not have enough money to implement this, and were you aware 
that back in December they announced an $8 billion loan 
guarantee for these programs?
    Mr. Hilton. Absolutely, but a loan guarantee doesn't give 
you money. It guarantees failure and recoup of the loan. The 
problem is to do a project and then get it financed, and you 
might notice, there has been no carbon capture projects 
applying for the $8 billion.
    Mr. Swalwell. Would hundreds of millions of dollars though, 
that we have for R&D that is proposed in the budget, would that 
be sufficient?
    Mr. Hilton. Well, there is only something on the order of 
about less than $100 million in the CCS program. What I am 
talking about is the kind of programs that lead to the 
demonstrations like the proposed Summit Project, the projects 
that have been delayed, where they put, our--if you will, our 
project at American Electric Power. But we had $450 million but 
the public utility commission refused because there was no 
regulatory requirement to allow the utilities to recover any 
costs on the project, so those are the kind of funds we need 
and those don't exist in the DOE budget.
    Mr. Swalwell. Mr. Hawkins, does NRDC, one of the country's 
most respected environmental organizations, believe that there 
is a role for coal in our Nation's energy future, and if so, 
why, if not, why not?
    Mr. Hawkins. We do believe that there is a role for coal. 
How long that role will last is a matter of conjecture. It 
will, in our view, depend on a combination of factors including 
whether coal can be brought into the 21st century and perform 
as an energy resource that is consistent with our other needs: 
to protect our society's dependence on a stable climate. Right 
now, it is not consistent, and whether it becomes consistent is 
precisely the topic of this hearing, and we thank you for 
holding it.
    Mr. Swalwell. Do you think that EPA standards are putting 
coal plants out of business or the clean natural gas boon 
putting coal plants out of business?
    Mr. Hawkins. The biggest challenge to coal investments 
today is the marketplace. We have slack power demand, in part 
due to the continuing effects of the recession, in part due to 
good things like energy efficiency and the improved renewables 
production, and we have abundant, low-cost natural gas, and 
that makes it very difficult for investors to look at a new 
coal project and say this is where we should put our money. It 
is just not attractive.
    Mr. Swalwell. And Mr. Hawkins, do you believe that it would 
be appropriate for the EPA to establish standards requiring 
implementation of CCS at existing plants? And I draw the 
distinction between those plants existing now and the proposed 
regulations for the future.
    Mr. Hawkins. We think that CCS should be permitted as a 
compliance technique for any regulation of existing power 
plants but we have not seen an analysis that would suggest that 
it should be required across the board and meet economic tests.
    Mr. Swalwell. And Mr. Hawkins, how can EPA determine that a 
technology is adequately demonstrated if it not yet 
commercially available? Any thoughts on that?
    Mr. Hawkins. Yes. The difference between commercial 
availability and adequate demonstration is very specific to the 
sector that is being looked at. So commercial availability asks 
the question, is there a vendor that can--that is willing to 
provide a commercial product to a particular type of industrial 
source, and if there is no market for it, the answer is often 
no. Actually in this case, there are vendors who provide 
commercial carbon capture systems for power plants so in this 
case, there is commercial availability, there just isn't 
commercial use because there is no reason for the power plant 
operators to use it.
    Mr. Swalwell. Great. Thank you, Mr. Hawkins.
    And with that, I will yield back the balance of my time.
    Chairman Schweikert. Well, you don't have any more. Thank 
you.
    Mr. Hall.
    Mr. Hall. I thank you, Mr. Chairman, for holding this 
combined hearing and very capably so.
    I appreciate hearing from the witnesses, or at least I 
appreciate hearing from some of them, their major concerns, not 
just concerns but major concerns with the proposed rule. Some 
of those concerns have been raised by the Attorney General of 
Texas. He has filed some 30 suits, I think, against this 
Administration, who seems like can't tell the truth, can't even 
call a terrorist a terrorist. But he has filed a number of 
suits, and not just him but the Attorney Generals from 
Oklahoma, Alabama, Michigan, Nebraska, South Carolina, Wyoming, 
in their February 28th letter to Administrator McCarthy. 
Without objection, I would like to enter their letter into the 
record.
    Chairman Schweikert. Without objection.
    Mr. Hall. Thank you, sir.
    [The information appears in Appendix II] MISSING
    Mr. Hall. I would like to commend the Texas Attorney 
General one more time, Mr. Greg Abbott, who has worked 
tirelessly to stand up against this Administration's what we 
call advanced federalism. Mr. Abbott and the other states' 
Attorney Generals are concerned about the EPA's draft 
underground injection control program guidance on transitioning 
class II wells to class VI wells. To move it would interfere 
with the authority granted to the states under this program. 
The proposed new class of wells, class VI wells, would create 
new regulations in connection with prospective carbon capture 
and storage operations. The Attorney General's letter states, 
and I quote, ``Notwithstanding this new class of wells intended 
to accommodate the underground injection of CO2, 
many oil and gas producers operating class II wells have been 
injecting CO2 for the past 40 years to manipulate 
well pressure and enhance the recovery of oil and gas. This 
process, commonly referred to as an enhanced oil recovery, has 
been used in more than 10,000 wells, about 7,000 of which are 
currently active, and EOR represents a critically important 
part of our state's and our country's energy infrastructure and 
plays an essential role in our Nation's economic stability and 
energy. The concern raised is that class II wells for EOR 
operations could be reclassified as class VI wells under the 
EPA's draft guidance, a situation that is creating an 
unnecessary level of uncertainty and risk to a mature area of 
industry that is already well regulated.'' So I join the 
Attorney General in calling for the EPA to take immediate 
action to rectify this situation created by the draft guidance 
and eliminate the uncertainty and ensure strict adherence to 
the applicable law. So I ask you a question, Mr. Trautz. Did I 
say that correctly, sir?
    Mr. Trautz. Trautz.
    Mr. Hall. That is what I said, I thought. Sir, in your 
testimony you noted that geology is not uniform. What 
specifically are the differences in geology that might make it 
more or less difficult to sequester carbon in different regions 
of the country?
    Mr. Trautz. Yes, so the geology is not created equal, so to 
speak. If you go to the northeastern United States, there is 
bedrock, crystalline rocks that will not hold CO2 
capacity. There isn't sufficient capacity up in the Northeast, 
so they make for poor reservoirs, and there is very limited 
availability of storage. Go to other areas of the United States 
and you will find much better reservoirs like in the Southeast.
    Mr. Hall. Let me ask you this. Are there parts of the 
country that simply does to have the geology for storage?
    Mr. Trautz. Yes, sir. The Northeast is one of those.
    Mr. Hall. And what other options would power plants in 
those locations have for managing carbon dioxide? Can they 
simply store the CO2 on site?
    Mr. Trautz. No, sir, because of the volume, but they would 
have the possibility of creating a pipeline that would then 
take that CO2 to better storage reservoirs.
    Mr. Hall. Do you think the EPA's proposed rule will put 
specific states and regions at a competitive disadvantage in 
terms of compliance?
    Mr. Trautz. In terms of compliance?
    Mr. Hall. Yes.
    Mr. Trautz. No, I don't think in terms of compliance.
    Mr. Hall. Well, then, let me ask you this. Do you believe 
CO2 pipelines can solve this problem?
    Mr. Trautz. That has been one of the possible avenues, yes, 
sir, because we do have CO2 pipelines that stretch 
down from Colorado into the Permian Basin in the----
    Mr. Hall. Thank you, and my time is just about up. I would 
also like to note that although environmentalists are 
supporting EPA's proposed New Source Performance Standards 
rule, I would like to enter into the record an article written 
this week explaining the Sierra Club and the other 
environmental groups that are actually opposing the Kemper 
Project that the EPA cites as an example of CCS.
    Chairman Schweikert. Without objection.
    [The information appears in Appendix II] MISSING
    Mr. Hall. With that, Mr. Chairman, I thank you and I yield 
back.
    Chairman Schweikert. Thank you, Mr. Hall.
    Mr. Veasey.
    Mr. Veasey. Thank you, Mr. Chairman.
    I wanted to touch on a little bit what Congressman Hall was 
just talking about a little bit. I know that many of the 
witnesses today have touched on the viability of storage 
technology for CO2, especially in EOR, and in Texas, 
you know, we have been doing this for a while, as it was 
already stated, particularly in the Permian Basin, and we have 
a complete pipeline structure that has been built around this 
process with the newest one being the Green Pipeline Project 
that was completed a short time ago transporting CO2 
from Louisiana to Texas, and the process has become so 
economically viable that now there is a shortage of 
CO2, raising the price upwards to about $30 per ton. 
I wanted to ask Mr. Hawkins and Mr. Miller, while CO2 
storage may not be feasible in one area of the country as it 
was stated a little bit earlier, aren't there other areas such 
as the Gulf Coast that actually have a high need and capacity 
for CO2 storage?
    Mr. Hawkins. Yes, Mr. Veasey. EOR is a great win-win-win 
opportunity for energy security, climate protection and I would 
argue for other environmental protection. We have lots of oil 
that is stranded in existing oil fields. It is not economic to 
get it out. It could be gotten out starting tomorrow if the 
CO2 were available. The CO2 isn't 
available because it is all going up into the air from 
uncontrolled industrial sources. We have an easy fix, which is 
to find a way of working the economics so that we put carbon 
capture on these power plants and then we use a pipeline 
network and expand pipeline networks, and the pipelining of 
this is easy. It is being done today. It goes hundreds of miles 
from southern Utah down into west Texas. It goes hundreds of 
miles from North Dakota up into Saskatchewan. Oil field 
operators are making money when the CO2 is 
available. This is proven technology. And in terms of 
distances, you know, the idea that it might rule out some 
locations in the United States for coal, that just doesn't hold 
water. We transport coal thousands of miles from Wyoming to the 
southeastern United States. We can transport the CO2 
from that same coal a few hundred miles back to EOR, no 
problem.
    Mr. Miller. My response would be on multiple levels. Number 
one, natural gas, or CO2 pipeline is feasible. 
Technologically, it is out there and it is happening. They are 
expensive. You run into some ``not in my backyard'' issues as 
you are putting in the pipeline, but they can be put in. You 
have--now you are transporting your CO2 to another 
area so you have a variety of environmental liabilities that 
you are going to be taking on and moving to another area of the 
country and so there is liability that goes back to your 
community.
    And then finally, on the EOR side--and this is not my 
specialty but what I have been reading on that is, CO2 
is a very expensive product and people are buying that and they 
are using that as a working fluid, but they are capturing that 
CO2 back out and continuing to use that as a working 
fluid. So it is not really a sequestration technology, it is a 
technology that is used to capture energy and recover energy 
and gas, so I don't see EOR as sequestration as much as a use 
of the CO2, and that is what is driving up the 
costs. They are trying to get that. They are using that fluid. 
But once they inject it in, they try to get that back out so 
they can use it again.
    Mr. Veasey. I think that both of you would agree that Texas 
has had a long history of using CO2 in plugged oil 
wells with very little environmental damage, and wanted to ask 
you specifically about the regulations for EPA's New Source 
Performance Standards. Based on what we heard from Mr. Hawkins 
just a second ago, wouldn't there--wouldn't we create more of a 
market under these regulations for CO2?
    Mr. Hawkins. Well, I think there would. The recycling that 
the witness mentioned is correct but it is only a fraction. 
About 30 percent of the injected CO2 comes up in the 
oil, and industry practice is to put that back down. But there 
is a net additional injection of about 50 million tons a year 
now, so it is storing lots of CO2, and yes, the oil 
industry would love to have additional supplies of CO2 
but we have a disconnect in the marketplace because there is no 
policy requirement to capture CO2, and given the 
other aspects of the marketplace, there is no economic 
rationale because the costs of capture are high enough that you 
can't earn money back in the typical situation for selling it 
for EOR. Now, there are some niche situations where you may be 
able to make a profit even today without a regulation, but to 
make this expand, you will need regulations to drive it.
    Mr. Veasey. Thank you. Thank you, Mr. Chairman.
    Chairman Schweikert. Thank you, Mr. Veasey.
    Mr. Rohrabacher.
    Mr. Rohrabacher. Thank you very much.
    First and foremost, we need to recognize that this debate, 
this discussion is predicated on certain premises that I 
disagree on, and those of us who think that the concept of 
global warming is fraudulent and that it has not been proven, 
we obviously are much more--those of us who don't accept the 
idea that there are--for example, when we hear that 97 percent 
of the scientists, we hear something like that quoted, we go my 
goodness, do 97 percent of the scientists believe that? Well, I 
am sorry but 97 percent of those scientists who replied from 
that questionnaire said that, not 97 percent of all the 
scientists as we hear repeated over and over again. It used to 
be repeated that we had global warming and now it is called 
climate change because it didn't get any warmer. We in fact had 
all of the people, those of us who have been around long enough 
to remember how adamant it was that there was going to be a 5-
degree jump in the temperature over the last 15 years, and 
instead we have had absolutely flat temperatures. So there is a 
premise that those of us on this side may disagree that maybe 
the whole basis of the discussion is wrong but let us get into 
the debate of the discussion today, which is we are talking 
about CO2 and the sequestration that is being pushed 
on us in the name of stopping global warming where they now 
call it climate change because the global warming stopped 15 
years ago.
    The gentleman from Texas just presented us a good picture 
of how in Texas they are utilizing CO2 in the 
production of oil. Now, let me ask the panel: If we then change 
the nature of the CO2 from being a natural source of 
CO2 put into the ground and we now are mandating 
that it is a byproduct of coal, the use of coal, that 
CO2, doesn't that change the regulatory mandates 
that the industry has to put up with and wouldn't that so 
dramatically change those regulatory mandates that it would 
make it almost impossible then to use even the coal that is 
our--even the CO2 that is now being used by the 
industry if you would intermix the CO2 from coal 
production with natural CO2? Does anyone on the 
panel know anything about that?
    Mr. Hilton. I think that the issue that you are addressing, 
sir, is, what has been expressed by people like Denbury is, you 
know, they would not choose to overlay the costs and the 
difficulty of subpart RR in regulations and they would--if they 
continued to use natural CO2, they are subject to 
those regulations.
    Mr. Rohrabacher. Right.
    Mr. Hilton. But if they were to bring in any CO2 
from a power facility, they would become subject to those 
regulations, and as I said, Denbury has issued a public 
statement saying that they would not use that because of cost 
and the impact on operations.
    Mr. Rohrabacher. So what we just heard from our very 
sincere colleague from Texas about--it would destroy the very 
thing that you are bragging about. The fact is, it would put a 
whole new regulatory burden just to utilize this CO2 
byproduct of coal production into the natural CO2 
would prevent or at least dramatically increase the cost of the 
very thing that you were talking about, which is CO2 
is used now by the oil industry.
    Yes, sir, go right ahead.
    Mr. Hawkins. Yes, Mr. Rohrabacher. Let me read a very short 
sentence from the Denbury Web site. ``CO2 EOR is 
increasingly being viewed as a strategy to reduce carbon 
emission from various current and proposed industrial 
facilities. Our CO2 process provides an economical 
and technically feasible method of CO2 disposal.'' 
So Denbury is holding itself out as being a source for disposal 
of industrial CO2, and we don't think it is 
sustainable for them at the same time to say if they are 
required to report on what happens to that CO2, they 
will refuse this business. We just don't think that washes.
    Mr. Rohrabacher. Well, we don't think it washes, but 
obviously there are a lot of people in business who have to put 
up with the regulations and the bureaucrats and the mandates 
and the government intrusions into the decision-making and the 
extra costs that government mandates will have have said we are 
concerned about that, and actually you are bringing a whole new 
set of fundamental laws that have to be dealt with by combining 
natural CO2 with a byproduct of coal. All of a 
sudden CO2 then is treated not as a natural material 
but as some sort of a toxic substance. As a toxic substance, it 
is highly regulated and a situation that would add dramatically 
to the cost and complication of doing business.
    Of course, it would be very well intended. Obamacare was 
very well intended as well. Thank you very much.
    Chairman Schweikert. Thank you, Mr. Rohrabacher.
    Mr. Neugebauer.
    Mr. Neugebauer. Thank you, Mr. Chairman, and thank you for 
holding this joint hearing.
    Mr. Miller, you know, this panel and previous panels have 
testified pretty consistently that CCS is not adequately 
demonstrated and not necessarily completely commercially 
available. So if that is the fact, then what are the 
implications for your customers, you know, City Utilities, 
retire older plants and need to add new sources of power? What 
is going to be the consequence if EPA moves forward with these 
regulations?
    Mr. Miller. Well, it could go a variety of directions but 
ultimately we have the obligation to serve our customers, and 
as a municipal utility, the money we spend is not shareholder 
money, it is our customer money, and so first of all, if we are 
in a retirement mode where we retire assets, it was mentioned 
earlier that some assets will be retired before the end of 
their useful life but you are still paying on those. Your 
customers have paid for those assets, so that is a loss of 
money there. Now you have to find either the ability to install 
not demonstrated technology--and I have been on the end where I 
have had to install demonstrated technology, whether it be a 
scrubber or selective catalytic reduction, and you buy those 
from vendors that are commercial. They have guarantees, and 
they are designed by nationally recognized engineers, and when 
you go to install those, you get surprises. Even commercial 
equipment, you still get surprises and there are some 
additional costs, and those costs flow back to your customers. 
So you are going to--our customers will pay more because you 
have assets that are retiring. You are putting in non-proven, 
non-demonstrated technology which ups the amount of risk that 
you are going to take on that you are going to find problems as 
you implement that technology, and that is cost. So those are 
all driving cost, increasing cost to customers, and so whether 
you buy it from the market or whether you install the 
technology that is not demonstrated, and when you retire the 
assets, that all flows back in our case right back to our 
customers. And so we are very protective of that because we 
have that obligation to serve, and they own us.
    Mr. Neugebauer. And so the next step of that is, okay, so 
you have those options out there, assuming that you have those 
options, it could increase the cost because of the increased 
cost in technology. Here is my question: If we keep going down 
this path of, you know, being anti-fossil fuel for the 
production of electricity in this country, whether it be coal 
or natural gas, you know, doesn't that begin to limit our 
options? In other words, your utility is not the only utility 
in the country that is, you know, facing this issue, and so we 
this massive consolidation of all these different communities 
or providers for communities looking for power sources, and if 
we begin to limit the choices, how do we keep the lights on?
    Mr. Miller. You are basically shrinking your subset of 
options, and these--as was mentioned earlier, it takes a long 
time to get these generating sources on and up and operating, 
and so you start limiting your capacity and you start running 
the potential of having reliability problems, not only in your 
region--or in your area but in the region, and you are putting 
a lot of pressure on these much reduced options available to 
your customers.
    So the answer is, we still have that obligation to serve. 
We are still going to do everything we can but you increase 
your risk of reliability issues across the Nation, and it also 
drives costs into the business world, and so your economic 
development picture changes too. Instead of adding jobs in your 
community, you might be freezing jobs or you might be reducing 
jobs or moving them elsewhere. So it impacts our low-income 
customers but it also impacts our economic development within 
our communities.
    Mr. Neugebauer. Mr. Miller, you were reading my mind 
because the next question I have is, okay, so we have got 
reduced capacity so we got a reliability factor and probably 
got a lot of price pressure then because you have got all of 
these people competing that have these contracts to deliver 
power, and they are looking for that power. And so the question 
is--and you mentioned it--is that, you know, job creation, you 
know, the impacts on businesses, manufacturing businesses, all 
kinds of business. It is pretty hard to run a business in this 
country without power.
    And so that is the reason I am going to ask unanimous 
consent, because Heritage just recently did a study that I 
think is important to the record, Mr. Chairman, and I will just 
read a little bit from that. It said that according to the 
report, by 2023 we can expect to see nearly 600,000 jobs lost 
nationwide with Texas losing 25,000 jobs and over 330,000 
manufacturing jobs could be lost because of this rule, and in 
my district alone we could expect to see maybe 400 people lose 
their job. So without objection, Mr. Chairman, I would like to 
put the Heritage report as a part of the record.
    Chairman Schweikert. Any objections? So ordered.
    [The information appears in Appendix II]
    Mr. Neugebauer. And I yield back the time I don't have.
    Chairman Schweikert. Thank you, Mr. Neugebauer.
    Mr. Cramer.
    Mr. Cramer. Thank you, Mr. Chairman, and I thank the 
witnesses for your testimony today.
    Before I forget, I want to do it right upfront or I almost 
certainly will, I want to place into the record without 
objection a letter from the North Dakota Industrial Commission 
that represents their comments on this rule. The Industrial 
Commission of North Dakota is made up of three separate elected 
officials who come together on the Commission. They are the 
Governor, the Attorney General and the Commissioner of 
Agriculture. So I would like to place that in the record.
    Chairman Schweikert. Without objection, so ordered.
    [The information appears in Appendix II]
    Mr. Cramer. Before I speak about what the Commission has 
written about, I am very pleased to know, Mr. Hawkins, that the 
Natural Resource Defense Council supports interstate pipelines, 
international pipelines even. Your reference to the CO2 
line from the Dakota gasification facility in North Dakota, 
which I helped site when I was on the Public Service 
Commission, to Weyburn, Canada, for enhanced oil recovery--by 
the way, when we sited it, we had a hearing and not a single 
person showed up. That is the way it is in North Dakota with 
good ideas.
    And so I am--however, your comment that pipelining is easy, 
I have to take some exception with. If building international 
and interstate pipelines was easy, we would have a lot more of 
them right now. We would have----
    Mr. Weber. Like Keystone.
    Mr. Cramer. Yes, for example. By the way, Chairman Hall, 
North Dakota's Attorney General is engaged so far in 12 
separate lawsuits against their federal Government, the EPA.
    In the comments that the Industrial Commission writes that 
North Dakota really focuses on this issue of CO2 as 
an asset. It is an asset. It is a resource. The EPA treats it 
as waste, same with the pore space. We treat it as an asset. 
The EPA treats it as waste and consequently there is tremendous 
regulatory confusion as a result, and so I know I might be a 
little redundant but I want to flesh this out even a little 
further. Maybe, Mr. Trautz, you could help me with this. Mr. 
Hilton made reference to it earlier. Can you describe the 
requirement that EOR operators, you know, have to operate under 
differently than, say, traditional sequestration? Can you maybe 
flesh that difference out a little bit for us so that I have a 
better scientific understanding and why should it be that way, 
if you think it should or why it shouldn't.
    Mr. Trautz. The difference between the reporting 
requirements on the greenhouse gas mandatory reporting 
requirement is under Subpart RR. That is for geologic storage 
or sequestration. There is a--sort of a burden of proof that 
you have to do a mass balance on the CO2 that you 
put into the ground. You have to ensure or at least look at, 
put through a monitoring program that it isn't coming back up 
to the surface.
    Mr. Cramer. Um-hum.
    Mr. Trautz. Under Subpart UU it is--the burden of proof is 
frankly not even there. It is really just monitoring the 
CO2 that goes into the field, as well as fugitive 
emissions from your operations or facilities, so there isn't 
the same level of reporting that is required in certainly 
monitoring.
    Mr. Cramer. Maybe, and this could be for all of the 
panelists because there was reference earlier to previous rules 
and previous technological advancements. I think mercury was 
specified, I think some of the others, I mean SOx, NOx. Is the 
commercially available or perhaps even the standard adequate 
demonstration of technology equal in this case in carbon 
capture as it was then with mercury and others, anybody or all 
of you? Mr. Hilton?
    Mr. Hilton. Congressman, I can really address that. The 
answer is we were doing the technologies required either not in 
this country or in other industries that everything that was--
that has been required under the Clean Air Act except for this. 
I mean, as I pointed out, we did scrubbers. The first scrubbers 
were at Battersea and Bankside, and they were there to protect 
the erosion of, you know, all of the buildings there. So we 
built these things for years.
    And as I said, I worked on my first one before the Clean 
Air Act existed. So I mean it is--you know, we have done these 
things. NOx reduction was developed in Japan, not here, but the 
technology was there. And I know because my company was a 
licensee of those companies.
    And so this is the first time we are dealing with something 
where we have nothing out there to show. And, you know, we are 
running down a path where Europe is not pushing this issue, 
China is not pushing this issue, India. We are alone out here. 
And so the technology has got to be developed here, you know, 
because--so I think, you know, this is the first issue where we 
haven't had the ability to--like in waste and energy where we 
had full-scale plans on mercury in the '80s.
    Mr. Cramer. Well, I thank you. I look forward to the day 
when the technology does catch up because I would love to burn 
more than, you know, that 30 million tons of coal we burn in 
North Dakota every year. We have an 800-year supply of it, so I 
would like to burn it for 800 years and use it to get even more 
oil out of the ground. That is a noble goal.
    Thank you.
    Chairman Schweikert. Okay. Thank you, Mr. Cramer.
    Mr. Hultgren.
    Mr. Hultgren. Thank you, Chairman. Thank you all for being 
here today for this really important hearing as we continue to 
assess technology as well as increased cost that EPA is 
mandating on the American people.
    While the Administration and EPA continue pushing for the 
uncertainty of a closed-door regulatory approach as opposed to 
the balanced long-term solution our legislative body is 
supposed to provide for the American people, it is crucial that 
Members of Congress understand the technologies being mandated, 
as well as how EPA made their decisions.
    While it is often hard even for Members of Congress to get 
answers from EPA, we unfortunately are the ones that have to go 
home and explain to our constituents what many see as 
unjustifiable. I am certainly glad to have such a diverse panel 
before us today, and it will be beneficial to have experts 
before us that understand the technology and can explain to us 
the process and hurdles of energy technology innovation.
    Mr. Hilton, I wanted to address my comments and questions 
to you if I may. Just to get an idea about how long the 
technology development process takes for energy technologies, I 
would like to discuss one of your projects with DOE that you 
briefly touched on in your testimony, the chemical looping 
combustion prototype for CO2 capture with the 
National Energy Technology Laboratories.
    I know that in December 2012 NETL technology readiness 
assessment for the Clean Coal Research Program, your chemical 
looping combustion prototype was given a technology readiness 
of five out of nine. I wonder if you could explain to the 
Committee what a technology readiness level is and wondered if 
you could also talk about how valuable TRL is in assessing the 
viability of technology to perform on a commercial level.
    Mr. Hilton. Well, it is basically assigning a level. There 
are characteristics to each level and assign how you move 
through the development into what is ultimately a commercially 
viable product. And chemical looping--and we really started on 
this and it depends when you really want to trace the roots, 
but let's say we started in earnest in chemical looping as we 
know it now in the '90s, and if all goes well, we expect it to 
be commercial in the early '20s, 2020, because what we have to 
do is solve the problems of chemical looping, moving the solids 
around, extracting the solids, extracting the CO2, 
auto thermal ignition, you know, because in early stages you 
provide the heat to make things work.
    So you get through this and then you have to bring them up 
from our current 3 megawatt unit to a 50 megawatt unit 
hopefully to something larger and eventually a full-scale 
because, as I said, when we go full-scale commercial, to get to 
that last level, that is what DOE and everybody else wants to 
see. So it is a long process in our industry.
    Mr. Hultgren. Yeah. I want to follow up on that a little 
bit. You mentioned the '90s. It is my understanding that your 
technology started bench tests in 1996. What would be the 
expected time frame for a project such as this? Could you go 
from bench testing to demonstration and then final commercial 
sale? Is that the 2020 number that you would say, so basically 
a 25-year to 30-year process?
    Mr. Hilton. That is pretty typical--
    Mr. Hultgren. Okay.
    Mr. Hilton. --for a process like this.
    Mr. Hultgren. And how often do technologies get the 
prototype scale before realizing they will not work on the 
commercial level?
    Mr. Hilton. More often than I would like to admit to, but 
R&D is--you know, it is kind of--to not have failure in R&D is 
just--is not an option--
    Mr. Hultgren. Right.
    Mr. Hilton. --I mean because it wouldn't be R&D. You would 
already know the answers.
    Mr. Hultgren. Right. Since EPA is charged with determining 
whether a technology has been adequately demonstrated and DOE 
already has a process in place to assess technology readiness 
levels, it seems to me that EPA should rely heavily on the 
scientists who understand the technology. At what TRL would you 
consider a technology to be adequately demonstrated?
    Mr. Hilton. Essentially, it should be toward the upper 
level of nine. I mean that is when you know things work and 
that is when you have built something that is large enough to 
say that this is something that can be applied.
    Mr. Hultgren. Okay. Well, thank you very much. Mr. 
Chairman, I yield back the balance of my time to the Chairman 
if you have any other questions. Otherwise, I would yield back 
my time.
    Chairman Schweikert. Thank you, Mr. Hultgren.
    Mr. Weber.
    Mr. Weber. Thank you, Mr. Chairman.
    EPA claims that enhanced oil recovery will bring costs down 
for power plants and for domestic energy reduction, but the 
reporting requirements on EOR operators will make it 
prohibitive for these companies to use CO2 from any 
future coal-fired power plants. These requirements will in fact 
inject, no pun, or maybe I should say pun intended, the EPA 
into a process that has long been successfully regulated by the 
states, especially my State of Texas.
    As our colleague over there, dare I say on the right; I 
should say over on the left, Marc Veasey, alluded to. CO2 
has been used for over 40 years in enhanced oil recovery. 
According to a detailed white paper, Mr. Chairman, which I have 
here from Denbury Resources, an EOR operator located in Texas, 
``the proposed NSPS rule will foreclose, not encourage''--I 
repeat--``will foreclose, not encourage the use of CO2 
captured by emission sources in EOR operations.''
    And, Mr. Chairman, I would like to submit this white paper 
into the record.
    Chairman Schweikert. Without objection.
    [The information appears in Appendix II]
    Mr. Weber. Thank you.
    Denbury Resources does use enhanced oil recovery, captured 
CO2. I have the--and that I know of, the largest and 
only CCS carbon capture and sequestration storage facility in 
my district in Texas, Port Arthur. It is--it was built/managed 
by Air Products at a cost of about $400 million. Sixty-six 
percent of the funding came from the Department of Energy or 
the American Reinvestment and Recovery Act, 66 percent of the 
funding.
    Now, if you read Air Products' news release on May the 
10th, 2013, about that, let me quote from their product--their 
press release. ``This unprecedented achievement comes by way of 
an Air Products innovative technology is the first of its kind 
operating at such a large scale''--and here is the key phrase--
``and has not been accomplished anywhere else in the United 
States.'' Further, down here they read--it says, ``this 
project''--they state that this project ``would not have been 
achievable without the support and involvement of the 
Department of Energy.''
    To call this something that is capable of being duplicated 
in a viable process in the United States is a laugh. It is an 
absolute laugh. For the witnesses, are there any of you all who 
get 66 percent funding in your salary or that would admit it?
    Let the record show there is none, Mr. Chairman.
    Are any--there are. We have business people at the table, 
right, that are in business. Any of you all whose businesses 
get 66 percent funding from the federal Government and would 
admit it?
    Let the record show there are none.
    Kemper, the project over in Mississippi, Kemper County, 
Southern Energy, the CEO came to the House Environmental 
Action--Energy and Action Team, which I am a member of, and 
testified some months--last year some months back and he said 
it is such a huge cost overrun and it is not applicable in--
anywhere else in the United states. And that is with Denbury 
having a pipeline right in their backyard so to speak, which, 
fortunately comes over into my district in Texas.
    Am I losing my microphone? No.
    So for us to say that this is duplicable and that this has 
been demonstrated as a--capable of being duplicated process, 
for the EPA to say that is unbelievable in my opinion.
    We have seen from testimony today the prices for energy--
Mr. Miller, for your customers, those that--as what Chairman 
Lummis said, demonstrably at the lowest economic rung will 
negatively impact those customers. Do you agree with that?
    Mr. Miller. Yes, sir, I do.
    Mr. Weber. You know, it seems to me it is irony of all 
ironies. We have got tax dollars, 66 percent of the project 
that the EPA alludes to, by the way, funding a process that we 
cannot duplicate that is going to hurt, you want to give new 
meaning to the term double jeopardy. We are using taxpayer 
dollars to fund a process that is going to hurt those who can 
least afford it at the bottom rung, maybe triple--let me just 
say maybe triple jeopardy.
    I would submit for this panel, for this body that we are 
going to jeopardize, number one, those who can least afford the 
energy cost. We are going to jeopardize investment. There will 
be no new jobs at a time when we need it, and we are going to 
jeopardize our national security because we are going to need 
energy to operate the things, our military. We are going to 
need energy to produce goods, products, services, and we are 
going to be triple jeopardized by trying to do this process the 
very economy in the greatest country in the world that is 
great, and I would ask any of you to disagree because we have 
the most solid, most affordable, most reliable, best supply of 
energy on the planet and we worked hard to get it that way. And 
this is going to undermine the very process. Does anybody 
disagree with that?
    Mr. Hawkins. I disagree.
    Mr. Weber. You--that----
    Mr. Hawkins. I disagree that it will undermine all----
    Mr. Weber. I know. Well, I am--Mr. Hawkins, I am so glad 
you are here, glad to hear that, as my colleague over here 
said, you support pipelines. You said in your statement earlier 
that these regulations would help oil companies operate more 
profitably. I am so glad you are concerned about the oil 
companies. That is just something that is very admirable on 
your part.
    And, Mr. Chairman, I have gone over my time so I yield back 
what I don't have.
    Chairman Schweikert. Thank you, Mr. Weber.
    Mr. Weber. Thank you.
    Chairman Schweikert. Mr. Bridenstine.
    Mr. Bridenstine. Mr. Hawkins, I just wanted to ask, can you 
explain a little bit about how EOR offsets the cost of carbon 
capture and storage?
    Mr. Hawkins. Yes. Currently, oilfield producers pay 
suppliers of CO2 that--they buy the CO2; 
they use it for injection. I don't know what the current 
price--going price is but it is more than $12 a ton of 
CO2, something like that. It might be as high as $20 
a ton. Contracts sometimes specify it as a percentage of the 
price of oil, so as the price of oil goes up, the price that is 
being paid for CO2.
    So the proposed builders of power plants like the Summit 
power plant project in Texas are negotiating arrangements with 
off-takers of that CO2.
    Mr. Bridenstine. Is the regulation required to enhance that 
market for the carbon dioxide?
    Mr. Hawkins. Either regulation or lots of money that we 
don't have is required because the market will not support it 
given the current market structure.
    Mr. Bridenstine. Is that an official policy of NRDC?
    Mr. Hawkins. Which aspect, sir?
    Mr. Bridenstine. The regulation would be required to create 
the market for the CO2 for EOR.
    Mr. Hawkins. That is our belief that--based on an analysis 
of market conditions that it won't happen without a 
requirement.
    Mr. Bridenstine. Can you share with me the difference 
between a Class II well and a Class VI well?
    Mr. Hawkins. I would be happy to provide you with our 
comments on Class II and Class VI, yes.
    Mr. Bridenstine. I have a document here from NRDC that 
suggests that Class II wells are insufficient for EOR but 
certainly Class VI wells would be better? But it seems like 
there aren't very many, if any, Class VI wells, is that 
correct?
    Mr. Hawkins. Our position is that for geologic 
sequestration activities where the company is proposing to 
permanently retain the CO2 underground, there ought 
to be some demonstration beyond what is required under current 
Class II rules that the CO2 will actually stay 
underground. That is our position.
    Mr. Bridenstine. So on the one hand we need EOR to make the 
market for CO2 viable; on the other hand, we want to 
severely limit EOR for the extraction of oil, is that correct?
    Mr. Hawkins. No, it is not correct, sir. Requiring 
companies to do reasonable monitoring and reporting will 
increase confidence that this----
    Mr. Bridenstine. But the reality is----
    Mr. Hawkins. If I might finish, it will increase confidence 
in the public that this is in fact a secure solution and that 
the operators are behaving responsibly.
    Mr. Bridenstine. If you limit EOR, it cannot be used to 
offset the cost of carbon capture and storage.
    And, Mr. Chairman, I would like to submit this document 
from the NRDC as far as the difference between Class II and 
Class VI wells and why NRDC seems to believe that it is 
necessary to limit EOR.
    [The information appears in Appendix II]
    Mr. Bridenstine. I would like to just, I guess, ask the 
panel. Mr. Miller, if you would share with me as somebody who 
operates utilities. We have an issue in my State of Oklahoma 
where, you know, we are literally closing down coal-fired power 
plants, and it is going to cost consumers in my district in the 
Tulsa area. We are going to see rates go up. Some people are 
saying it is going to go up six percent, some people are saying 
20, some people as much as 40 depending on the time horizon. 
Over the next 10 or 20 years it is going to be a significant 
increase.
    The challenge here is that coal is stable, the price is 
stable, and natural gas, we are seeing spikes across the 
country in very specific regions when it gets cold, which it 
still does get cold in places. In New York we saw it, the price 
of natural gas went up to, you know, over $90 in certain areas. 
That creates a huge risk in my opinion, $90 per thousand cubic 
feet. It is a huge risk. In Colorado it went up recently, you 
know, $45 per thousand cubic feet. This is now something that 
we are going to have to deal with in Oklahoma because of the 
shuttering coal-fired power plants. Would you share with me 
your thoughts on that?
    Mr. Miller. Well, we just experienced that in your state. 
In our region just a week or so ago we had a cold spell and 
there were plants that were supposed to run during that coldest 
day going from Sunday into Monday, and when they went to run, 
there wasn't enough gas supply.
    So within our region, Oklahoma, Missouri, and Arkansas 
area, we had plants--we had up to 1,700 megawatts that were 
supposed to run that they--that did not, and then we saw 
natural gas prices go from about $5 up to $20 plus for a couple 
days in a row and it was because we had constraints in pipeline 
and we had generating units that couldn't run because we didn't 
have the gas that can be delivered to them.
    And as we see more of these regulations come on in 2015 and 
'16, you will see a more generation--coal generation come off-
line, but I am not sure where that capacity is to replace it. 
So we will be feeling the pressure within the marketplace over 
the next few years.
    Mr. Bridenstine. Thank you. I yield back.
    Chairman Schweikert. Thank you, Mr. Bridenstine.
    Ms. Bonamici had something quick she wanted to share.
    Ms. Bonamici. Thank you very much, Mr. Chairman.
    As we conclude the panel, I wanted to thank every one of 
you for coming here today to inform us.
    I also wanted to say something about a comment that was 
made earlier about thanking or appreciating only some of the 
witnesses today. All of you have spent a lot of time preparing 
for this hearing, traveling here to inform us, to share your 
years of expertise, and even though every one of us might not 
agree with everything that every one of you said, you all 
deserve to be thanked and appreciated.
    Thank you, Mr. Chairman. I yield back.
    Chairman Schweikert. Thank you, Ms. Bonamici.
    And I want to thank the witnesses for their testimony and 
the Members for their questions. And we will ask you to respond 
to those questions in writing.
    You know, there are so many things--this is one of those I 
wish I could have a day with no one else because there are so 
many odd technical things I would like to understand of, you 
know, the optionality that is available in these technologies, 
what is robust, what isn't, and even just the whole discussion 
on EOR and the practicalities of how do you both incentivize 
that but at the same time do some of the regulatory approaches, 
do we change the cost structure in a way where we lose that 
opportunity?
    So with that, this panel is dismissed. Thank you for your 
valuable time today.
    I think we are going to take about 90 seconds and everybody 
grab a cup of coffee and we will move on.
    Okay. I would like to introduce our second panel, which 
is--and it is pronounced McBride?
    Ms. McCabe. McCabe.
    Chairman Schweikert. McCabe, sorry.
    Our second panel witness is Janet McCabe, Acting Assistant 
Administrator of the Office of Air and Radiation in the 
Environmental Protection Agency. Previously, she was at the 
Office of Air and Radiation, Principal Deputy to the Assistant 
Administrator. Prior to joining the EPA, Ms. McCabe was the 
Executive Director of Improving Kids' Environment, Inc., a 
children's environmental health advocacy organization. She also 
previously served in several leadership positions in the 
Indiana Department of Environmental Management Office of Air 
Quality.
    Ms. McCabe, you have five minutes. You know the routine, 
yellow light, talk faster.

                   TESTIMONY OF JANET MCCABE,

                ACTING ASSISTANT ADMINISTRATOR,

                  OFFICE OF AIR AND RADIATION,

              U.S. ENVIRONMENTAL PROTECTION AGENCY

    Ms. McCabe. All right. Thank you, Mr. Chairman.
    Chairman Schweikert and in absentia Chairman Lummis, 
Ranking Members Bonamici and Swalwell, and Members of the 
Committee, thank you for the opportunity to testify today.
    Climate change is one of the greatest challenges of our 
time. Our changing climate already threatens human health and 
welfare and economic well-being through the increased intensity 
and frequency of severe heat waves, a rise in sea level 
affecting our coastal businesses and communities, and a 
combination of rising temperatures and changing precipitation 
that leads to increased droughts and wildfires. If left 
unchecked, climate change will have devastating impacts on the 
United States and on the planet.
    Last June, President Obama issued a national Climate Action 
Plan directing the EPA and other federal agencies to take steps 
to mitigate the current and future damage caused by greenhouse 
gas emissions and to prepare for the climate changes that have 
already been set in motion. Climate change is also a global 
challenge, and the President's Plan recognizes that the United 
States must couple action at home with leadership abroad.
    Today, you have asked me to focus on the critical role EPA 
plays in implementing one of the central activities in the 
Climate Action Plan: cutting carbon pollution from new power 
plants. In March of 2012, the EPA first proposed carbon 
pollution standards for future power plants. After receiving 
over 2.5 million comments, we issued a new proposed rule based 
on this input and on updated information.
    In September of 2013, the EPA announced its new proposal. 
The proposed standards would set the first uniform national 
standards for carbon pollution from future power plants. They 
will not apply to existing power plants. The proposal would set 
separate national limits for new natural gas-fired turbines and 
new coal-fired units.
    These standards, which are proposed under Section 111 of 
the Clean Air Act, are based on an evaluation of the technology 
that is available to limit carbon pollution emissions at new 
power plants. EPA proposed these standards by following a well-
established process to determine the ``best system of emission 
reduction, adequately demonstrated'' to limit pollution, 
otherwise known as BSER.
    These proposed standards reflect the demonstrated 
performance of efficient, lower carbon technologies that are 
currently being used today. They set the stage for continued 
public and private investment in technologies like efficient 
natural gas and carbon capture and storage. The proposal was 
published in the federal Register on January 8, and the formal 
public comment period is now open. In fact, the EPA recently 
extended the comment period to May 9 to ensure that we get as 
much public input as practicable. We look forward to robust 
engagement on the proposal and will carefully consider the 
comments we receive as a final rule is developed.
    As noted, the proposed rule would apply only to future 
power plants. For existing plants, we are engaged in extensive 
and vigorous outreach to a broad group of stakeholders, 
including states, who can inform the development of proposed 
guidelines. EPA expects to issue these proposed guidelines by 
June of this year.
    These guidelines will provide guidance to states, which 
will have the primary role in developing and implementing plans 
to address carbon pollution from the existing plants in their 
states. We recognize that existing power plants require a 
distinct approach, and this framework will allow us to 
capitalize on state leadership and innovation while also 
accounting for regional diversity and providing flexibility.
    Responding to climate change is an urgent public health, 
safety, national security, economic, and environmental 
imperative that presents great challenges and great 
opportunities. As the President and Administrator McCarthy have 
stated, both the economy and the environment must provide for 
future and current--current and future generations. We can and 
we must embrace cutting carbon pollution as a spark for 
business innovation, job creation, clean energy, and broad 
economic growth.
    The continued global leadership of the United States and 
the success of the Clean Air Act over the past 40 years make it 
clear that public health protection and economic growth go hand 
in hand.
    Thank you again for the opportunity to testify, and I look 
forward to answering your questions.
    [The prepared statement of Ms. McCabe follows:]
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

    
    Chairman Schweikert. Thank you, Ms. McCabe. And you just 
did that very efficiently.
    And going over your testimony, can I drill down on just a 
couple of things I had some curiosities on? As you head 
towards, what is it, the May 9 ending of public comment----
    Ms. McCabe. Right.
    Chairman Schweikert. --you actually had the discussion of 
demonstrated technologies, particularly as we speak of the 
ACO2 standards. And some of this I know I am asking 
for sort of technical observation, but in the previous panel 
there was a lot of concern on the quality of demonstration, 
demonstration at capacity, demonstration at stress, 
demonstration of saline and other types of sequestration. Yet 
the rule set that you have produced basically in many ways is 
written as if the demonstration is done, that the technology is 
robust and ready to go, and yet the previous panel was pretty 
crisp even from right to left that there is still some real 
concerns on the technology itself. How do you do the rule set 
in that environment?
    Ms. McCabe. Well, that goes to the heart of the proposal, 
Mr. Chairman. We do believe that the proposal we put forward 
meets the requirements of the Clean Air Act for determining 
technology that is appropriate. And I want to clarify that what 
we do in a New Source Performance Standard is we set a 
performance standard, an expectation in the amount of CO2 
that these facilities can emit. We don't specify a particular 
technology. That is one of the beauties of how the Clean Air 
Act has worked over the years is that it provides room for 
innovation and flexibility and smart people, like you heard 
from the previous panel, finding better and less costly ways to 
do things.
    But when it comes to the technology that we based those 
numbers on, we believe that if you look across all the 
information and data that is available, that there is adequate 
and robust data showing that the various components that we 
base that standard on are in use, have been in use, and will be 
ready----
    Chairman Schweikert. But even in many of your own 
documents, and, look, this is just sort of an academic 
discussion I am trying to--there is discussions of 
demonstration projects but none of them are near the types of 
scales we are talking about with also the geographic, 
geological diversity. It is a little trucky--excuse me--it is a 
little tricky writing a rule set to something that is still I 
think a long way from scaled demonstration. And so from a 
personal concern, as we heard in testimony and then it was 
actually corrected by a couple of the other folks, almost all 
other clean air technologies that have been adopted had 
actually been around for years in some type of full scale 
before it actually hit clean air rule sets.
    Can I just walk through one other--and this is one I am 
genuinely trying to get a better--wrap my head around is we 
keep having the discussions that EOR may be one of the 
financing mechanisms of, you know, ACO2 types of 
capture. But at the same time as we look at some of the 
discussions, what is it, RR? I will just refer to it as number 
six well regs. Doesn't this discussion over here dramatically 
change the economics of EOR and even just the discussion of it 
creates sort of a potential cost liability that even if you are 
going to say, hey, we are willing to sort of enter into these 
future agreements for an EOR capture mechanism, but all of a 
sudden if we end up in this new regulatory environment, we have 
just destroyed the economics of such type of agreement.
    Ms. McCabe. Well, there was a lot in your question, Mr. 
Chairman, so I will try to--I will go----
    Chairman Schweikert. And sorry about that. It was a linear 
line of thought.
    Ms. McCabe. Yeah. No, I understand. Let me talk about the 
last part of your question first. The people are doing EOR. 
People have been doing EOR----
    Chairman Schweikert. For decades.
    Ms. McCabe. --for decades very successfully. And though--
the regulations that people have been speaking about, the RR 
regulations had actually been around for a number of years as 
well and----
    Chairman Schweikert. But like number six----
    Ms. McCabe. --people have been using them----
    Chairman Schweikert. But has there ever been an--and I am 
sorry; I know I just interrupted and I hate it when I do that--
an EOR which actually--where there is a number six sort of well 
standard?
    Ms. McCabe. Well----
    Chairman Schweikert. Because something like that doesn't 
exist anywhere.
    Ms. McCabe. The number six well standard is for situations 
where people are injecting CO2 into the ground 
solely for the purposes of sequestering it there and leaving it 
there.
    Chairman Schweikert. Okay.
    Ms. McCabe. EOR is a completely different application.
    Chairman Schweikert. So EOR would fall more under the RR?
    Ms. McCabe. So that is the Class II well----
    Chairman Schweikert. Okay.
    Ms. McCabe. --EOR.
    Chairman Schweikert. So if I was doing EOR, I would be able 
to stay--you are telling me stay within Class II well standard 
and the RR enhanced regs side would not affect me?
    Ms. McCabe. No, the RR regulation--monitoring regulations 
do apply when an intent is to leave CO2 in the 
ground and it is intended to provide that additional 
information and assurance that the CO2 actually is 
remaining in the ground.
    Chairman Schweikert. So if I did EOR but part of it was 
also as a capture mechanism, I would still at least--I would 
fall under the----
    Ms. McCabe. That is right.
    Chairman Schweikert. --future monitoring?
    Ms. McCabe. That is right.
    Chairman Schweikert. Okay. Thank you.
    And with that, just because I know I am over time and you 
have some time restraints on you, hopefully we will get a 
second round.
    Ms. Bonamici.
    Ms. Bonamici. Thank you very much, Mr. Chairman. Thank you, 
Ms. McCabe, for your testimony.
    When you listened to the prior panel--and I have to say 
that there seems to be some mixing of the standards of 
adequately demonstrated and commercially available. I went back 
and looked at some of the discussion when Section 111 was 
implemented--when it was passed and implemented, and I found a 
discussion from the Senate Committee that says that it was 
designed to promote constant improvement in techniques for 
preventing and controlling emissions from stationary sources, 
and an emerging technology used as the basis for standards of 
performance need not be in actual routine use somewhere.
    And also a D.C. Circuit Court interpreted ``adequately 
demonstrated'' to be ``technically feasible'' stating that the 
section looks toward what may fairly be projected for the 
regulated future rather than the state-of-the-art at present 
since it is addressed to standards for new plants. So could you 
talk just a little bit about how this section has spurred 
technology development previously? And we heard some testimony 
before about if the regulation is there, that the technology is 
developed, but without that requirement, the technology is not. 
So if you could address that and then I have another question.
    Ms. McCabe. Sure. You are exactly right, and the history 
and the description that you have given of Section 111 is 
exactly what we understand the Clean Air Act and Congress to 
have intended, which is that technology will move and innovate 
when there is a requirement to do so. We heard a lot of 
discussion about that today.
    But there are many examples going back through time where 
Section 111 was the mechanism that took emerging technologies 
and brought them into the mainstream. And in fact, there is--
Mr. Chairman, I do have to take issue with your comment a 
minute ago that in all prior 111 rules technology had been 
around for years. That is really not the case. One example I 
can cite for you is selected catalytic reduction technology, 
which is a NOx reduction technology, and it had been used in 
one type of application but it had never been used for 
industrial boilers.
    Chairman Schweikert. To that point, actually, the catalytic 
converter----
    Ms. Bonamici. It is my time, Mr. Chairman.
    Chairman Schweikert. I won't take it out of your time.
    That catalytic conversion technology had been around a 
century, you know, using--you know, in the high temperature 
adjustments, maybe not in the way you described it, but it had 
been around for quite a long time.
    Ms. McCabe. It had not been used in this particular--and 
the particular sector----
    Chairman Schweikert. But the basic technology has been 
around for decades and decades.
    Ms. McCabe. And similarly here we have technology that has 
been around for decades and decades and used in a variety of 
applications. So you do find that Section 111--and when these 
requirements are put in place, it does drive that technology 
development and then it becomes more widespread, the costs go 
down, and it becomes part of the mainstream.
    Ms. Bonamici. I wanted to ask you also--thank you for your 
testimony--that you mentioned in your testimony that the EPA 
plans to issue proposed guidelines to lower carbon pollution 
from existing power plants by June of this year and that the 
Agency recognizes that existing power plants require a distinct 
approach. In fact, the EPA's website states that the standards 
that will be developed for currently operating sources are 
expected to be different from and less stringent than the 
standards proposed today for future sources. Can you please 
discuss EPA's process for developing guidelines for existing 
power plants and why the guidelines will be less stringent and 
more flexible than the standards for new plants?
    Ms. McCabe. Absolutely. We are operating under two distinct 
elements of the Clean Air Act here, and the Clean Air Act 
traditionally has had a very different approach to regulating 
existing sources. In fact, for the most part, existing sources 
are regulated under state plans, and that is exactly what will 
happen here.
    So EPA's job here is to set guidelines for how the states 
will go about developing plans to address their own power 
plants. And the expectations for what would be appropriate 
technology for existing plants that are in place, that are 
located where they are, that have whatever remaining life they 
have are very, very different.
    And, for example, and the Administrator has said this on 
numerous occasions, we do not have any expectation that carbon 
capture and sequestration would form the basis for any 
expectation relative to existing plants.
    Ms. Bonamici. Thank you. And one more question. There has 
been some discussion today about the potential increase in 
costs if the carbon capture and storage rule is--when it is 
implemented. Can you talk about some of the costs associated 
with the lack of action to address climate change and 
increasing emissions? Thank you.
    Ms. McCabe. Yes. It is a very good question. There are 
costs to our economy and to society from the impacts that 
climate change are already having. In 2013 there were seven 
extreme weather events, which I think is kind of a nice way of 
saying great big huge horrible storms, that cost the economy 
over $1 billion each. And this is a real economic impact on our 
communities, on our families across the country.
    Ms. Bonamici. And healthcare costs might be----
    Ms. McCabe. And healthcare costs and disruption to families 
and to all communities.
    Ms. Bonamici. Thank you. My time is expired. I yield back.
    Thank you, Mr. Chairman.
    Chairman Schweikert. Thank you, Ms. Bonamici.
    Chairwoman Lummis.
    Mrs. Lummis. Thank you for being here, Ms. McCabe.
    Are you here to testify then that these weather events 
absolutely were caused by climate change?
    Ms. McCabe. There--the scientific community has identified 
a number of impacts of climate change. Among those are 
increased intensity and frequency of weather events----
    Mrs. Lummis. So are you sure that these specific weather 
events that you cite are caused by climate change?
    Ms. McCabe. I can't--I am not a meteorologist. I can't 
speak to any specific weather event and----
    Mrs. Lummis. Thank you. Why is the EPA requiring a CCS 
analysis for new natural gas-fired units, including power 
plants, as well as boilers and heaters within manufacturing 
plants?
    Ms. McCabe. The EPA is proposing a performance standard for 
new fossil-fired power plants. We have one standard for gas and 
one standard for coal. Those standards are based on our review 
of the data that is available about what technologies are 
available for those plants to use going forward and----
    Mrs. Lummis. Can you outline for us today the specific 
condition under which EPA would require CCS for either natural 
gas-fired utility units or non-utility boilers and heaters?
    Ms. McCabe. The rule does not require any specific 
technology. The rule sets a performance standard.
    Mrs. Lummis. Well, why is the agency requiring this 
analysis?
    Ms. McCabe. We are not requiring anybody to do an analysis. 
We are setting a performance standard that new plants will need 
to meet----
    Mrs. Lummis. Does CCS need guidance? Is that the same 
thing? Are we speaking about the same thing?
    Ms. McCabe. Perhaps we aren't. I thought you were talking 
about the proposed New Source Performance Standards rule. Is 
that not correct?
    Mrs. Lummis. That is correct.
    Ms. McCabe. Okay. The New Source Performance Standards 
rule, which we proposed last fall and is in the comment period 
now, addresses new, not-yet-built, not-yet-started coal and 
gas-fired power plants, and that rule sets a performance 
standard that the companies then will figure out how they will 
meet.
    Mrs. Lummis. Wouldn't an EPA policy memorandum stating that 
CCS is not required for new natural gas plants reduce this 
regulatory uncertainty and help expedite permitting decisions?
    Ms. McCabe. For natural gas plants? The----
    Mrs. Lummis. This is for EPA--you are requiring CCS 
analysis for LNG facilities, too, correct?
    Ms. McCabe. Congresswoman, I think you may be talking about 
the Prevention of Significant Deterioration program.
    Mrs. Lummis. Yes.
    Ms. McCabe. Okay. So that is a program that when new plants 
come in, require them to go through an analysis of what the 
best technologies are out there and then employ that as part of 
their project. And so that is what I think we are talking about 
here.
    Mrs. Lummis. The distinction between EPA's analysis of best 
system for emission reduction for coal versus natural gas 
escapes me. Are there any pulverized coal projects you can cite 
like post-combustion CCS?
    Ms. McCabe. So there are several plants that have been 
using carbon capture--power plants that have been using carbon 
capture, for example, the Shady Point plant, the Warrior Run 
plant. There are also several plants that have been discussed 
today that are in construction that will be using this 
technology.
    Mrs. Lummis. Are there any post-combustion natural gas 
projects?
    Ms. McCabe. Using CCS?
    Mrs. Lummis. Yes.
    Ms. McCabe. Not that I am aware of.
    Mrs. Lummis. What about pre-combustion CCS projects on coal 
plants?
    Ms. McCabe. You are getting a little bit beyond my level of 
expertise, Congresswoman, but we would be glad to answer those 
questions for you after the hearing.
    Mrs. Lummis. Okay. Thank you.
    The President's budget includes 25 million to fund natural 
gas CCS projects. Now, if one of these projects becomes 
operational, would that be sufficient for EPA to begin 
requiring CCS as part of the NSPS or the PSD permitting 
process?
    Ms. McCabe. I think it would--those are very fact-specific 
determinations and we would have to take a look at the 
particular facts when and if that happened.
    Mrs. Lummis. My time is expired. Thank you, Ms. McCabe.
    I yield back.
    Chairman Schweikert. Thank you, Mrs. Lummis.
    Mr. Hall.
    Mr. Hall. Thank you, Mr. Chairman.
    Ms. McCabe, I feel a little guilty and that I have been 
here a long time and I was here when we passed the Clean Air 
Act and Clean Water Act, and knowing the oil and gas people, I 
felt, and most of us Republicans and Democrats alike felt that 
they needed some oversight and--but they also needed some 
federal help. And I do not find that they have been conducive 
to fairness now in ordering a lot of companies to do things--to 
do the impossible and not give them time even to do the 
possible. And that is the major problem that I have seen, but I 
know that you are Acting Assistant Administrator, so you have 
been there several years, have you?
    Ms. McCabe. Yes, sir.
    Mr. Hall. Okay. Well, then in the EPA's first New Source 
Performance Standard proposal in 2012 you were there. The EPA 
determined that carbon capture and storage technology was not 
the best system of emissions reduction for new coal power 
plants, correct? That is what it says. That is----
    Ms. McCabe. Yeah. That is the proposal that we withdrew, 
Congressman.
    Mr. Hall. Well, I am getting to that. A year later in your 
latest proposal EPA says it is now the best system for 
emissions reduction. You just changed your mind overnight?
    Ms. McCabe. No, sir. We revised our proposal----
    Mr. Hall. It took you a month or so to do it then?
    Ms. McCabe. No, sir. We revised our proposal based on the 
information that we had available to us at those points in the 
process.
    Mr. Hall. Okay.
    Ms. McCabe. And we felt--and we got a lot of input on the 
first proposal and we felt that a different approach was the 
appropriate one given all of that information that we obtained.
    Mr. Hall. What has changed so dramatically in one year to 
allow the EPA to reach a different conclusion on the technical 
and economic feasibility of CCS?
    Ms. McCabe. We actually felt that the revised proposal 
provided a much clearer and more appropriate path for gas-fired 
facilities and coal-fired facilities, and that was the basis 
for our decision to change the proposal.
    Mr. Hall. Well, I guess I was hoping that you could help me 
understand the EPA's position with respect to the Clean Air 
Act's requirement that it can only mandate the use of emissions 
reduction systems that have been ``adequately demonstrated.'' 
Would you agree, yes or no, that there isn't a single utility 
scale power plant in the world currently operating with CCS?
    Ms. McCabe. Not--I am sorry. Can you repeat the last part 
of that?
    Mr. Hall. Would you agree that there isn't a single utility 
scale power plant in the world currently operating with CCS?
    Ms. McCabe. There are small facilities operating.
    Mr. Hall. There are small--what do you----
    Ms. McCabe. There----
    Mr. Hall. How do you distinguish that?
    Ms. McCabe. Well, there are a variety of sizes of utility 
boilers and there are operating facilities that are small that 
are using this technology now.
    Mr. Hall. Okay. Well, then would you agree, yes or no, that 
the law's requirement that a technology system be ``adequately 
demonstrated'' is past-tense, not future-tense? You are having 
a hard time with that one.
    Ms. McCabe. Well----
    Mr. Hall. Do you want me to go onto the next one?
    Ms. McCabe. Well, no, sir. I would agree that the law 
requires that we look at technology that is in use and make a 
judgment based on whether that is feasible and available for 
the particular sector that the rule covers.
    Mr. Hall. That it is adequately demonstrated?
    Ms. McCabe. That it is adequately demonstrated.
    Mr. Hall. The Clean Air Act requires that the entire system 
of a new technology be adequately demonstrated, not just the 
individual components. How does EPA's decision to mandate that 
power plants employ a technology system that has never been 
fully and adequately demonstrated considered legal under the 
Clean Air Act? How can you justify that?
    Ms. McCabe. We believe that the system has been adequately 
demonstrated looking at the variety of applications that have 
been used and are in use and have been used for many years.
    Mr. Hall. Well, maybe you can and this next--you can 
provide any other example of a ``demonstrated'' technology 
required by EPA regulations where the technology was not used 
on a commercial basis?
    Ms. McCabe. The--our--the--our rule and the technical 
documents that accompany it go through all the examples of 
existing uses of the various technologies that we base of the 
rule on and we are happy to provide those to the----
    Mr. Hall. Okay. Let me close. I just have two seconds left.
    Ms. McCabe, at a hearing before the Energy and Commerce 
Committee on September 2011, Administrator McCarthy had this to 
say: ``I certainly don't want to give the impression that EPA 
is in the business to create jobs,'' one of the most cruel 
statements I have ever heard. Do you agree with the 
Administrator's statement?
    Ms. McCabe. I don't know--I am not familiar with that 
quotation. That is not how the Administrator feels. We are very 
concerned about----
    Mr. Hall. It is just the way she talks----
    Ms. McCabe. --jobs that are created----
    Mr. Hall. --but not the way she feels?
    Ms. McCabe. I wasn't there----
    Mr. Hall. I know you weren't.
    Ms. McCabe. --Congressman. She is very concerned about----
    Mr. Hall. I don't believe you would have said----
    Ms. McCabe. --jobs in this country.
    Mr. Hall. --anything like that. I would like to think you 
wouldn't because I left her space to correct that or to 
apologize for it or to say she was misquoted.
    I yield back. I don't have time. Thank you.
    Chairman Schweikert. Thank you, Mr. Hall.
    Mr. Hultgren.
    Mr. Hultgren. Thank you, Chairman.
    Thank you, Ms. McCabe, for being here today. It really is 
crucial that we on the Science Committee have a thorough 
understanding of the science behind the technological 
development necessary for your agency to accomplish the goals 
the President has set out.
    While Administrator McCarthy has come before this committee 
touting science as the backbone of everything you do at EPA, I 
am worried that this has not been the case in regards to the 
technologies your agency is essentially mandating with your 
proposed regulations.
    When designing the rule for the New Source Performance 
Standards, I assume EPA was in close consultation with the 
National Energy Technology Laboratory when deciding whether or 
not technology was adequately demonstrated. Was that the case?
    Ms. McCabe. Well, we do work closely with them but it is 
EPA's job to make the determination about whether technology is 
adequately demonstrated. That is my----
    Mr. Hultgren. So there--and that specifically adequately 
demonstrated but there was not cooperation or consultation with 
the National Energy Technology Laboratory?
    Ms. McCabe. There was consultation and much discussion with 
them about the types of technologies that are out there and 
various scientific and technical discussions about them, but 
the determination within the law is EPA's to make.
    Mr. Hultgren. As of December 2012 NETL report on the 
Technology Readiness Assessment for clean coal research 
programs, NETL had 285 projects underway developing 
technologies related to CCS. Only one project had a TRL above 6 
and 77 percent of the projects were at 4 or below. The only 
project above 6 was a regional carbon sequestration project 
that is not widely applicable across the United States.
    The DOE fossil energy description of plant technology as 
TRL 6 is engineering scale models or prototypes are tested in a 
relevant environment. Pilot or process development unit scale 
is defined as being between 0 and five percent final scale. I 
wondered how did EPA reconcile the obvious differences between 
what you are calling adequately demonstrated and what the 
administrative agency charged with developing the technology 
has clearly defined as being at five percent or less of the 
final scale?
    Ms. McCabe. Well, there is a lot of information available 
about the types of technologies that we are talking about here, 
and in fact, the Secretary of Energy has indicated on many 
occasions that he is comfortable that this technology is 
available and ready for use and should be employed.
    So these are all the kinds of discussions that we have with 
technical experts in and outside of government to make a 
determination about adequately demonstrated.
    Mr. Hultgren. Well, the frustration for us is there is a 
clear differentiation and it seems like ignoring many of those 
who should be listened to.
    One of the reports that helped spur DOE to begin assessing 
technology readiness came from GAO, the title, ``Major 
Construction Projects Need a Consistent Approach for Assessing 
Technology Readiness to Help Avoid Cost Increases and Delay.'' 
While this report focused on the cost overruns and delays for 
DOE projects but did not assess whether or not a technology was 
ready before construction began, it only makes sense that the 
private sector would experience the same problems developing 
and integrating the vast amount of unready systems necessary 
for a commercially viable plant to begin operating.
    My concern is that we are rushing this out before it is 
ready at the detriment of long-term technological advancements 
and cost decreases. What evidence does EPA have showing the 
private sector is better dealing with these cost increases and 
delays when developing and integrating unready technologies?
    Ms. McCabe. Well, Congressman, I think you are reflecting 
the history of the way technology has in fact developed under 
the Clean Air Act. And as we heard earlier, there are projects 
moving forward today where private sector commercial operations 
are competing essentially to provide this technology to 
projects going forward. So we are seeing it in the marketplace 
and this is the way technology develops. It is the way it 
developed with scrubbers; it is the way it developed with SCRs 
and many other examples of technology. It starts with a few 
projects and then it grows.
    Mr. Hultgren. For me it is a privilege to serve on the 
Science, Space, and Technology Committee. As I started 
questioning, talked about again how we have heard over and over 
again that science is the backbone of everything you do at EPA. 
Again, just from the few questions I have had and from what I 
have heard today, I think there are real concerns of that is 
not the case, that there are other agendas pushing ahead of 
what the science says. We are concerned about that. I want to 
get back to truly seeing science as the backbone of everything 
EPA does.
    With that, Mr. Chairman, I yield back.
    Chairman Schweikert. Thank you, Mr. Hultgren.
    Mr. Rohrabacher.
    Mr. Rohrabacher. Thank you very much.
    Mr. Chairman, yes, it is important that we get our science 
right here because what we are doing is mandating costs and 
mandating, how do you say, goals that our business has to 
achieve in order to provide services and products and jobs for 
our people.
    Let me just note that for the record, Mr. Chairman, I would 
like to put in for the record an article by Professor Matt 
Collins of the United Kingdom's Meteorological Office, a 
professor at Exeter University, suggesting that his analysis 
that there is no evidence to suggest that weather is any more 
ferocious or frequent than it ever has been in the past. I 
would like to put that into the record at this point.
    Chairman Schweikert. Without objection.
    [The information appears in Appendix II]
    Mr. Rohrabacher. So we see and we also heard earlier about 
97 percent of the scientists that quoted again and of course, 
as I suggested during the last time I had a chance to ask 
questions, that was 97 percent being presented to us as 97 
percent of all the scientists is actually 97 percent of the 
scientists who replied to a questionnaire in which the people 
who were asked were actually decided upon and then it was just 
the people who replied to the questionnaire, much less 97 
percent of all scientists.
    You don't believe that 97 percent of all scientists agree 
with the manmade global warming theory, do you?
    Ms. McCabe. Congressman, there is overwhelming support in 
the scientific community----
    Mr. Rohrabacher. That is not my question. The 97 percent 
that we hear, overwhelming could be 60 percent, could be 50 
percent. I don't even believe it is overwhelming, but you don't 
believe it is 97 percent, do you?
    Ms. McCabe. I don't know that it is helpful to talk about--
--
    Mr. Rohrabacher. Well, I am asking you a question.
    Ms. McCabe. Right.
    Mr. Rohrabacher. Do you believe that this is clear--this 97 
percent figure is thrown at us all the time. You don't believe 
that, do you?
    Ms. McCabe. I don't believe it or disbelieve it, 
Congressman.
    Mr. Rohrabacher. You don't want to answer the question, do 
you?
    Ms. McCabe. No, it is just--it is not a----
    Mr. Rohrabacher. Why can't you answer the question then? I 
am asking you whether you believe that this figure that is 
presented to us as the 97 percent an accurate or inaccurate 
figure?
    Ms. McCabe. Ninety-seven percent of the studies on this 
issue conclude that climate change is real and happening.
    Mr. Rohrabacher. That wasn't my question. My question was 
do you believe that 97 percent of the scientists believe that 
global climate change is happening because of human activity?
    Ms. McCabe. Well, the premise of your question, the 97 
percent----
    Mr. Rohrabacher. Okay.
    Ms. McCabe. --doesn't come from----
    Mr. Rohrabacher. Okay.
    Ms. McCabe. --number of individual scientists; it comes 
from the number of studies.
    Mr. Rohrabacher. Okay. So in other words, the people who 
have been throwing the 97 percent figure at us have been wrong?
    Ms. McCabe. I don't know who has been saying what----
    Mr. Rohrabacher. Well, we just heard it earlier, didn't we, 
in this--so you weren't listening to the----
    Ms. McCabe. I was----
    Mr. Rohrabacher. All right. All right.
    Ms. McCabe. --listening.
    Mr. Rohrabacher. Okay. You don't want to answer that 
question. I got it.
    Well, and you believe then that the weather is more 
ferocious. I just put a very reputable scientist who obviously 
doesn't agree with you. He is probably not apart of that 97 
percent of that you don't want to comment on. Do you believe 
that the weather now is more ferocious and do you disagree with 
that scientist's findings?
    Ms. McCabe. I am not familiar with that particular study so 
I don't want to speak to it in particular. I am also not a 
climate scientist myself----
    Mr. Rohrabacher. All right.
    Ms. McCabe. --so I don't want to hold myself out as an 
expert on that, but I pay attention to----
    Mr. Rohrabacher. Okay. Now, with that said, if all of the 
mandates that we are talking about and the change in regulation 
that we are talking about happen, I take it is--and we keep 
hearing that it is motivated on trying to save the climate and 
this--change the climate of the planet to make sure that we 
aren't changing the climate of the planet, how much effect on 
the climate of the planet will these regulations have?
    Ms. McCabe. So these regulations are intended to control 
the amount of CO2 that is emitted----
    Mr. Rohrabacher. Right.
    Ms. McCabe. --by future power plants. We know that 
CO2----
    Mr. Rohrabacher. Um-hum.
    Ms. McCabe. --is a key contributor to what is happening in 
the climate and that we must reduce the amount of CO2 
in the atmosphere in order to have an impact.
    Mr. Rohrabacher. Um-hum.
    Ms. McCabe. This is a global pollutant.
    Mr. Rohrabacher. Right.
    Ms. McCabe. It is a global problem.
    Mr. Rohrabacher. Right.
    Ms. McCabe. There are many, many sources of it. These are 
significant sources of it and----
    Mr. Rohrabacher. So there will be a significant change in 
our climate if we follow these new guidelines, is that correct?
    Ms. McCabe. These guidelines are an important part of an 
effort in this country and globally to make the kind of changes 
that are needed to address climate change.
    Mr. Rohrabacher. Okay.
    Ms. McCabe. You will not be able to----
    Mr. Rohrabacher. That is a good way not to answer the 
question. How much effect will it have on the climate?
    Ms. McCabe. You will--no individual rule will be able to be 
traced----
    Mr. Rohrabacher. Very little----
    Ms. McCabe. --because this is----
    Mr. Rohrabacher. So it will have very little impact----
    Ms. McCabe. It is----
    Mr. Rohrabacher. --is that right----
    Ms. McCabe. It is an----
    Mr. Rohrabacher. --if any?
    Ms. McCabe. It is an important aspect of the effort to 
reduce CO2 globally.
    Mr. Rohrabacher. All right. Again, you don't want to answer 
the question.
    Listen, when I ask a question in a debate, I am willing to 
debate the things that I disagree with. You have dodged almost 
every question that I have asked you. I am sorry. That is not 
the way we should be handling ourselves here.
    But with that said, I think there is an honest disagreement 
as to whether human activity is changing our climate. It is an 
honest disagreement. We need to be more forthright and willing 
to actually confront the points being made by each side of this 
debate, and I don't think you have been that way with us today.
    Thank you very much.
    Chairman Schweikert. Mr. Cramer.
    Mr. Cramer. Thank you, Mr. Chairman. Thank you, Ms. McCabe, 
for your testimony, for being with us during this long morning 
into the afternoon.
    There was some confusion I sensed when Chairman Hall asked 
about current use or current demonstrations of CCS. How many 
coal plants use carbon capture now, coal-fired electricity 
plants?
    Ms. McCabe. So I actually don't add these up. Do we have a 
number?
    Mr. Cramer. Can you name some? Could you name some?
    Ms. McCabe. Yeah. Yeah. So the Warrior Run power plant, the 
Shady Point power plant, there is a power plant in Germany 
called to the Vattenfall Schwarze power plant.
    Mr. Cramer. Do you know what the average size or how many 
megawatts they produce?
    Ms. McCabe. I don't have that information with me, 
Congressman, but we can get it for you.
    Mr. Cramer. Okay. Because I have to be honest. Now, I am 
going to respect the Ranking Member who has very effectively 
tried to discern the difference between adequate demonstration 
and commercially available, and yet without something being 
commercially available, I don't know how you demonstrate it. In 
other words, if it is not being done at a commercial level, at 
a level that would be equivalent to what we are asking here and 
what we are suggesting in terms of new power plants, it is hard 
for me to comprehend how it has been adequately demonstrated. 
But I respect the difference.
    How are we going to determine whether something is 
adequately demonstrated if it is not commercially deployed at 
the scales that we are applying the rule to?
    Ms. McCabe. Right. Well, I think that is the debate that is 
concerning the Committee here. The Clean Air Act does not use 
the term ``commercially available.'' It uses the term 
``adequately demonstrated.'' And as Congresswoman Bonamici 
cited some of the history of that section and the way it has 
been applied, it has been--it was clear that Congress intended 
for this provision to be--to put the United States on the 
forefront of developing technologies. And so it is not an 
expectation that technology be wide--in widespread use, and 
that has been clearly demonstrated over the years.
    Mr. Cramer. But in the most recent proposal, you actually 
do state that carbon dioxide emissions from new power plants 
are from CCS has not been implemented and that we believe there 
is insufficient information to make a determination, these are 
quotes from the EPA's proposed rules regarding technical 
feasibility. It seems to me that the same exact thing applies 
here to coal, that if it has not been done with CCS, or with 
combined cycle, it has not been done with coal, why the 
difference?
    Ms. McCabe. Well, there is a difference. There is a 
difference in the information that is available and there is a 
significant difference in the ways in which these technologies 
are deployed and are being used in the coal versus natural gas 
situations. There are also technical differences between the 
operations of those plants where we do not have information on 
the natural gas side that we do on the coal side, and that is 
the basis of our proposal.
    Mr. Cramer. As you know, in order for this, if we had the 
carbon capture technology and if it was adequately demonstrated 
and it became commercially available and it was economically 
feasible to do it, and to meet the growing demand--by the way, 
in North Dakota where I live and where I was once a regulator, 
we have a demand of over 2,000 megawatts right now that is 
being unmet to meet the growing economy that we have as a 
result of our more reasonable regulatory touch I might add.
    But the EPA has specifically cited the North Dakota Weyburn 
CO2 pipeline from the----
    Ms. McCabe. Um-hum.
    Mr. Cramer. --great Synfuels plant----
    Ms. McCabe. Yeah.
    Mr. Cramer. --Great Plains Synfuels plant, which I was just 
at a week ago Friday with the Administrator.
    Ms. McCabe. Yeah.
    Mr. Cramer. We had a very good meeting there. But that 
requires an international pipeline. You perhaps heard me 
discuss it earlier today. This is day 2,000 of the Keystone XL 
pipeline's review process, which the EPA has largely criticized 
and opposed, continues to throw up sort of barriers I guess. Is 
EPA prepared to, you know, support CO2 pipelines all 
over the country and perhaps even across international lines?
    Ms. McCabe. There are CO2 pipelines across the 
country and we are----
    Mr. Cramer. I am very familiar with that----
    Ms. McCabe. Yeah. Yeah.
    Mr. Cramer. Yeah.
    Ms. McCabe. And we believe that that is an important part 
of moving this technology forward and putting in place things 
that will be able to take carbon dioxide out of the air.
    Mr. Cramer. I just hope the EPA is this cooperative when it 
actually comes time to siting some of these CO2 
pipelines should we need to get them to market.
    I am just going to wrap up, Mr. Chairman, by saying that 
the EPA also notes that natural gas prices--and they have 
claimed natural gas prices have been the real determining 
factor in the marketplace, and yet we are--here we are coming 
off of the winter where PJM actually had to seek relief from 
FERC from its $1,000 per megawatt hour price cap because 
natural gas prices spiked as a result of a cold winter. It is a 
very volatile fuel. I support it but I don't think we should 
displace coal with it.
    Mr. Bridenstine. [Presiding] The gentleman yields back.
    Mr. Weber from Texas.
    Mr. Weber. Thank you, Mr. Chairman.
    Ms. McCabe, should the President issue a red line on 
CO2 emissions? Would that help?
    Ms. McCabe. I am not sure I understand your question.
    Mr. Weber. Well, when he declares that there is a red 
line--or would that further erode the Administration's 
capability in a, pardon the pun, storm of controversy? It seems 
like the global warming religion has been bought into hook, 
line, and sinker by this Administration. You talked about the 
Administration's credibility and EPA's credibility. Are you 
aware of the three fracking cases where they issued a statement 
to the fact that they had contaminated water in three areas of 
the country here, a year or two back? Are you familiar with 
those three cases?
    Ms. McCabe. I am not sure I know specifically what you are 
referring to.
    Mr. Weber. Okay. But you are aware that it did happen?
    Ms. McCabe. I am aware that there have been issues related 
to----
    Mr. Weber. Right, and they had to retract their statement 
that in fact fracking had contaminated three areas of drinking 
water?
    Ms. McCabe. I am actually not familiar with the specific 
statements that you are----
    Mr. Weber. Well, I am glad----
    Ms. McCabe. --referring to.
    Mr. Weber. --I can inform you of that today. That makes me 
feel like today was in some fashion worthwhile.
    You mentioned in your prepared remarks, I have got a copy 
of it here in front of me, that EPA would like to be able to 
approach on--I am sorry--that you would be able to capitalize 
on state innovation in dealing with these regulations. And if 
you look up the word capitalize, there are a couple different 
definitions. It says take advantage of, turn something to one's 
advantage, and then the other one is supply with capital, as in 
dollars and cents. And you were, I think, in the backroom 
watching the previous panel, is that right?
    Ms. McCabe. Yes.
    Mr. Weber. I don't know if you saw my comments about the 
carbon capture and sequestration and storage facility in my 
district in Port Author by Air Products where it was a 400 and 
something million dollar project, but the EPA--or the DOE 
rather supplied 66 percent of the funding. You are aware of 
that project?
    Ms. McCabe. I am aware of the project and I heard your 
statements earlier.
    Mr. Weber. Okay. And you don't disagree with what I said in 
that regard?
    Ms. McCabe. I don't have independent knowledge of the 
amount.
    Mr. Weber. Okay.
    Ms. McCabe. I will take your word for it.
    Mr. Weber. But it sounds reasonable. So in Texas we have 
been doing enhanced oil recovery for about 40 years, as was 
alluded to by our colleague on the left, Marc Veasey, earlier. 
And we do a good job of it. And so you want--in your earlier 
comments, you said you wanted to capitalize on the stakeholder 
input and the states', I guess, experience. Texas has a great, 
great history of experience in EOR and in producing an economy 
that is arguably the 11th largest in the world if it was a 
country. Why wouldn't you want to follow Texas' model when it 
comes to enhanced oil recovery, when it comes to air quality 
permitting? I realize that is--we are in a little bit different 
realm there----
    Ms. McCabe. Um-hum.
    Mr. Weber. --but why won't the EPA acquiesce to following 
the TCEQ in Texas? Do you have any knowledge about that?
    Ms. McCabe. Well, our job under the Clean Air Act when it 
comes to setting standards for new----
    Mr. Weber. Um-hum.
    Ms. McCabe. --power plants is to do that, is to set 
standards for new power plants. What I was referring to in my 
testimony was the provisions dealing with existing power plants 
where we do very much intend to look to states that have been--
--
    Mr. Weber. Thirteen hundred people a day are moving to 
Texas. We have created more jobs than the other lesser 49 
states in many years combined----
    Ms. McCabe. Um-hum.
    Mr. Weber. --and we are the country's leading state 
exporter of products for like 11 years running. We get it in 
Texas. Less onerous government regulations, we have got wide-
open spaces with clean air and great drinking water, and so I 
hope that the EPA will really take that into account and follow 
Texas' model on that.
    Are you here today to testify that you think that what was 
done at the Air Products plant in Port Arthur, Texas, a $400 
million project with 66 percent government funding, that that 
proves and demonstrates that this is a viable project to be 
done or a process in business? Are you here to testify to that?
    Ms. McCabe. Sir, I am here to speak about our proposal, 
which is based on a variety of information, not any----
    Mr. Weber. And do you think that that is----
    Ms. McCabe. --one single project.
    Mr. Weber. But--all right. Well, can you tell me of another 
carbon capture and sequestration storage facility that is that 
big or of that magnitude?
    Ms. McCabe. Well, there is--I am not as familiar with the 
specifics of that project as you are certainly, but there are 
places where carbon is being injected into the ground. There is 
lots and lots of EOR going on everywhere around the country and 
indeed around the world----
    Mr. Weber. So you don't have an opinion about whether that 
adequately demonstrates this as a duplicable process?
    Ms. McCabe. I do have an opinion that we set forth in our 
proposed rule that when you look at all of this information 
that is available, all the projects that are out there, that we 
do believe that the technology has been adequately demonstrated 
to support the performance standard----
    Mr. Weber. Well, would you----
    Ms. McCabe. --that was proposed.
    Mr. Weber. --agree with the fact that the technology to put 
a man on the moon has been adequately demonstrated?
    Ms. McCabe. Adequately demonstrated is a legal term within 
the meaning of the Clean Air Act----
    Mr. Weber. Well, let me----
    Ms. McCabe. --and I wouldn't want to apply it----
    Mr. Weber. --put it this way. Did we put a man on the moon?
    Ms. McCabe. We did.
    Mr. Weber. Okay. But you would not want to mandate that all 
airlines need to have that technology, putting a man on the 
moon, right?
    Ms. McCabe. With respect, Congressman, I am not sure it is 
a valid analogy----
    Mr. Weber. Well, what I am saying is you are taking this 
plan based on the funding and the model that was done in the 
Air Products plant and you are saying that that adequately 
demonstrates that it ought to be in the rules.
    Ms. McCabe. I am saying that the whole body of information 
that we have is--supports a finding that the technology has 
been adequately demonstrated----
    Mr. Weber. And the EPA never takes funding into account, do 
they, the cost?
    Ms. McCabe. We do take cost into account, very much we do. 
And as our documents show underlying the rule, the cost--should 
I finish?
    Chairman Schweikert. Please finish----
    Ms. McCabe. Okay.
    Chairman Schweikert. --your thought.
    Ms. McCabe. The cost of building a new coal plant with all 
the technology that we have looked at, partial capture and 
sequestration is comparable with other non-natural gas-
powered----
    Mr. Weber. Well, we are going to have to disagree.
    Thank you, Mr. Chairman.
    Chairman Schweikert. Thank you, Mr. Weber.
    And Arizona is getting about 350 people a day, but we are a 
lot smaller.
    Mr. Bridenstine.
    Mr. Bridenstine. Thank you, Mr. Chairman.
    I had a couple of thoughts and questions. Over the past 
several months, we have seen a troubling trend of the EPA 
deliberately avoiding transparency and accountability. When 
members of EPA's own Science Advisory Board raised serious 
questions about the NSPS rule, astonishingly, the Agency 
claimed that storage is beyond the scope of this rule. In other 
words, the EPA wants people to believe that carbon capture and 
storage systems don't have to consider where the carbon goes 
and neither does the Agency. It is misleading and dangerous for 
the EPA to quietly dismiss inconvenient facts. Do you agree?
    Ms. McCabe. We--I have to disagree with the premise of your 
question, Congressman. We very much respect the role of the 
SAB. We engaged with them in a very open process. All the 
conversations we had with them were completely open to the 
public and on the record.
    Mr. Bridenstine. Okay. I would like to submit this letter 
for the record. This is a letter from the EPA's Science 
Advisory Board. I will just read one sentence here, actually, a 
couple sentences. It says, ``the portion of the rulemaking 
addressing coal-fired power plants focuses on carbon capture 
and that the regulatory mechanisms for addressing potential 
risks associated with carbon sequestration''--carbon capture--
``are not within the scope of the Clean Air Act.'' And this is 
the advisory board.
    ``Carbon sequestration, however, is a complex process, 
particularly at the scale required under this rulemaking, which 
may have unintended multimedia consequences. The Board's strong 
view''--the Board's strong view--``is that a regulatory 
framework for commercial-scale carbon sequestration that 
ensures the protection of human health and the environment is 
linked in import systematic ways to this rulemaking.'' This 
letter has been submitted in the record.
    Even though the EPA officials sought to, you know, 
obviously not take this into account, the EPA science advisors 
continue boldly to call for a thorough review of the science in 
the science underlying this rule. Will you commit to me today 
that you will heed your own science advisors and await a full 
review of the serious concerns raised by the Science Advisory 
Board before finalizing this rule?
    Ms. McCabe. We will of course work with our Science 
Advisory Board, but what I will reflect to you, Congressman, is 
what the Board recognized was that within the four corners of 
this proposed rule, the regulatory approach and the--the 
sequestration and storage is not within the four corners of 
this rule; it is addressed in other regulatory programs--
    Mr. Bridenstine. So real quick----
    Ms. McCabe. --that have been mentioned today.
    Mr. Bridenstine. --the law doesn't require the Agency to 
examine non-air environmental consequences of CCS systems?
    Ms. McCabe. That is a provision of the law.
    Mr. Bridenstine. Okay. But it is not a provision of what 
you deem appropriate in this rule?
    Ms. McCabe. No, not at all. Not at all. I was trying to 
clarify that the Science Advisory Board recognized that 
sequestration, underground injection of carbon, is addressed in 
other regulatory programs, not in this one.
    Mr. Bridenstine. Okay. Does the Agency consult with the 
U.S. Fish and Wildlife Service to determine if this rule would 
impact, endanger, or threaten species?
    Ms. McCabe. We have not consulted with the U.S. Fish and 
Wildlife on this provision.
    Mr. Bridenstine. Do you intend to?
    Ms. McCabe. We are--we will apply--we will comply with all 
applicable requirements, including that one if it is deemed to 
be applicable here.
    Mr. Bridenstine. So, again, will you commit to me that you 
will not go forward with this rule until you have, you know, 
examined the environmental consequences for non-air, you know, 
parts of the environment?
    Ms. McCabe. I will commit to you that before we finalize 
this rule, we will assure ourselves that we have satisfied all 
the legal requirements associated with this particular 
rulemaking.
    Mr. Bridenstine. Although I understand the proposal does 
not currently require carbon capture and storage for gas or oil 
power, can you assure me that the Agency will not consider 
requiring CCS for gas-fired power plants in the future?
    Ms. McCabe. We do not have a factual basis that suggests 
that that is an appropriate thing, which is why we did not 
include it in this rule.
    Mr. Bridenstine. Can you assure me that the Agency will not 
consider requiring CCS for gas-fired power plants in the 
future?
    Ms. McCabe. We do not have present plans to move in that 
direction.
    Mr. Bridenstine. Can you assure me that the Agency will not 
consider requiring CCS for gas-fired power plants in the 
future?
    Ms. McCabe. I can't commit the Agency indefinitely into the 
future, Congressman. I can tell you where we are right now and 
we do not foresee that.
    Mr. Bridenstine. One other thing that I think is important, 
you know, there is potentially the application of the new SPS 
standards or similar assumptions of reasoning to existing 
plants that are modified and reconstructed. Can you assure me 
that the Agency will not require CCS for modified and 
reconstructed coal-fired power plants?
    Ms. McCabe. That is a rule that will come out as a proposal 
later this spring, and that rule will lay out what the 
expectations are that are there. I will tell you that we are 
looking at those facilities which are existing in a different 
way than we look at brand-new un-built power plants.
    Mr. Bridenstine. You mentioned one project that is in 
Oklahoma, Sandy Point, as one of the projects that is a 
demonstration of the capability in the technology. How many of 
these projects are there?
    Ms. McCabe. I cited three.
    Mr. Bridenstine. Are they all power plants?
    Ms. McCabe. Those three are power plants. So the three I 
cited are power plants. There are many other industrial 
applications of the technology as well, but I was asked 
specifically about power plants.
    Mr. Bridenstine. And, for the record, can you submit what 
the current size and the status of those power plants are? My 
time is expired.
    Ms. McCabe. Sure. We will follow up with that information.
    Chairman Schweikert. Thank you, Mr. Bridenstine.
    You had requested a UC, there are only two of us so I guess 
there is no objection.
    [The information appears in Appendix II]
    Chairman Schweikert. It is always wrong when you object to 
your own Member. Yeah.
    Give me just a couple seconds. I want to make sure that we 
touched on a couple other externalities that I wanted to make 
sure we had touched on.
    I may submit a couple other more technical questions to you 
in writing.
    Ms. McCabe. Sure.
    Chairman Schweikert. I know these are always sometimes 
mentally taxing and the preparation that goes into it.
    This is the first time I have ever said this in my short 
time here in Congress. I am a little disappointed at some of 
the intellectual capital we have shared because I was somewhat 
hoping to do something much more technical on where are we 
really on the science. What is the, you know, I come from the 
world of the law of unintended consequences is when we don't 
think things through--how many major projects have we all 
stepped into, we have watched our government and industry step 
into and we are here a few years from now and we go, ``we 
missed that.''
    You know, if we were holding this hearing 12 years ago, 
part of your opening would have been about peak oil and the 
world running out of energy and fossil fuels, and today, we 
know we had our data absolutely wrong. And how do we make major 
decisions like this that have a series of economic effects and 
hopefully environmental effects and make sure we are doing it 
in the most technically rational, thought-out, disciplined, and 
properly economically incentivized fashion? And so hopefully we 
can send you over some more questions and some of your team can 
respond to them.
    And with that, I want to thank you for your testimony and 
do be prepared that the Members may have additional questions 
for you. And we will ask you to respond to those in writing. 
The record will remain open for a couple weeks for additional 
comments and written questions from Members.
    And with that, thank you for participating with us today.
    Ms. McCabe. Thank you, Mr. Chairman. We will be happy to 
follow up----
    Chairman Schweikert. And with that, the----
    Ms. McCabe. --with any questions.
    Chairman Schweikert. And with that, the hearing is closed.
    [Whereupon, at 1:01 p.m., the Subcommittees were 
adjourned.]
                               Appendix I

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                   Answers to Post-Hearing Questions

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